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Investing.com – Mosaic stock (NYSE:MOS) fell 5.2% in premarket trading Wednesday after fourth quarter earnings fell short of estimates.
The company stated that supply chain constraints and impacts related to COVID are impacting the global market for potash and phosphates.
It said labor shortages in North America, rail and truck delays, and weather impacts are slowing the delivery of inputs to facilities and products to end customers. In Brazil, road and port congestion is also slowing deliveries, the company said.
“These issues, combined with the current global supply and demand situation, point to tight markets for both phosphates and potash well into 2022,” it said.
The warning comes as higher prices hurt fourth-quarter volumes for the two key fertilizers.
Net sales of potash were $2.6 billion, up from $2 billion. Phosphate net sales rose to $4.9 billion from $3.1 billion a year ago. Phosphate sales volumes suffered because of the impact of Hurricane Ida in the second half of the year.
The company said its previous plan of buying back shares worth up to $400 million will be initiated this month. Once over, it will be followed by a new $1 billion repurchase program.
Strong agricultural commodity pricing trends are expected to continue driving the demand for fertilizers through 2022.
The company further added that the global demand for grain and oilseeds remains high. Strong global fertilizer demand in 2022 is expected as growers seek to maximize yields.
Total net sales rose over 56% to $3.84 billion and just matched estimates. Fourth-quarter adjusted profit was $1.95 compared to the estimate of $1.97.
