Moscow – PhosAgro (MOEX/LSE ticker: PHOR), one of the world’s leading vertically integrated phosphate-based fertilizer producers, increased fertilizer production volumes by 1.2% year-on-year to 2.3 million tonnes in 1Q 2019. Sales volumes for the same period grew by 5.2% year-on-year to 2.5 million tonnes. 

PhosAgro’s production and sales volumes are summarised in the tables bel

ow.

Production volumes by type

(‘000 mt)

1Q 2019

1Q 2018

Chg y/y

Phosphate-based & MCP

1,777.6

1,757.2

1.2%

Nitrogen-based

567.6

560.8

1.2%

Total fertilizers

2,345.2

2,318.0

1.2%

PhosRock & nepheline

2,928.1

2,789.7

5.0%

Other products

48.3

42.9

12.6%

 

Sales volumes by type

(‘000 mt)

1Q 2019

1Q 2018

Chg y/y

Phosphate-based & MCP

1,929.0

1,753.2

10.0%

Nitrogen-based

617.4

667.5

-7.5%

Total fertilizers

2,546.4

2,420.7

5.2%

PhosRock & nepheline

1,121.7

955.9

17.3%

Other products

49.2

38.3

28.5%

Commenting on the 1Q 2019 operating results, PhosAgro CEO Andrey Guryev said:

“PhosAgro got off to a strong start in the first quarter of 2019, with 10% year-on-year growth in phosphate segment sales, mainly driven by high levels of market activity and inventory release. Inventories rose in 4Q 2018 due to slow European demand for fertilizers as a result of bad weather conditions in the region. However, our flexible sales policy enabled PhosAgro to sell to the markets where we can achieve the best netback prices. Global fertilizer markets look relatively balanced at present, which means that we are comfortable providing fertilizer production guidance for 2019 of 9.4 million tonnes. 

“Fertilizer sales rose by 5% year-on-year in 1Q 2019, mainly driven by the sell-down of inventories accumulated in the last months of 2018 and relatively high demand for phosphate-based products. Seasonal demand recovery and our well-developed sales network, with seven trading offices across Europe, enabled us to keep phosphate volumes flat year-on-year and increase sales of urea by 70% year-on-year. The strongest growth was in North America, where phosphate sales advanced by 25% year-on-year, driven by the expectation of solid demand from agricultural producers. Phosphate sales to Latin America were up by 10% year-on-year. Sales of phosphate-based fertilizers in Russia increased by 14% year-on-year, as farmers started preparations earlier, ahead of high season on export markets. At the same time, sales of AN decreased by 32% year-on-year in the first quarter, due to the early start of Russia’s high-season in 4Q 2018, which is our main market for this product.

“As expected, prices for phosphate-based fertilizers gradually softened during the course of 1Q 2019, but remained flat year-on-year, pushing feedstock prices lower. Looking ahead, phosphate prices will remain under the pressure in 2Q 2019 due to oversupply in the United States amid major flooding in March. This, combined with the relatively strong Rupee, caused India to accelerate its DAP imports at the end of 1Q 2019. The main supportive factor for the market next months should be seasonal demand recovery in Latin America, especially in Brazil. In the mid-term, the introduction of new capacities by OCP and Ma’aden is still the main source of downside risk.”

The table below provides a breakdown of production volumes by major product:

Production volumes by type

(‘000 mt)

1Q 2019

1Q 2018

Chg y/y

Apatit mine and beneficiation plant

Phosphate rock

2,637.3

2,523.9

4.5%

Nepheline concentrate

290.8

265.8

9.4%

Phosphate-based fertilizers

DAP/MAP

812.9

798.1

1.9%

NPK

599.8

646.6

-7.2%

NPS

198.3

132.7

49.4%

APP

49.6

51.7

-4.1%

MCP

96.5

88.2

9.4%

PKS

20.5

39.9

-48.6%

Nitrogen-based fertilizers

AN

145.3

143.5

1.3%

Urea

422.3

417.3

1.2%

Other products

STPP

26.2

24.8

5.6%

Other

22.1

18.1

22.1%

Feed stock

Ammonia

491.6

496.1

-0.9%

Phosphoric acid

673.9

656.1

2.7%

Sulphuric acid

1,498.4

1,483.9

1.0%

The table below provides a breakdown of sales volumes by major product:

Sales volumes by type

(‘000 mt)

1Q 2019

1Q 2018

Chg y/y

Apatit mine and beneficiation plant

Phosphate rock

825.7

691.4

19.4%

Nepheline concentrate

296.0

264.5

11.9%

Phosphate-based fertilizers

DAP/MAP

944.3

808.7

16.8%

NPK

655.9

646.7

1.4%

NPS

169.5

135.7

24.9%

APP

61.8

47.5

30.1%

MCP

87.3

85.6

2.0%

PKS

10.2

29.0

-64.8%

Nitrogen-based fertilizers

AN

170.6

249.1

-31.5%

Urea

446.8

418.4

6.8%

Other products

STPP

25.9

23.7

9.3%

Other

23.3

14.6

59.6%