MOSAIC announces it will close its fertilizer operations in Argentina & Chile 10/30/13

From La Nacion  October 30, 2013                 (Google Translated)

 

It leaves the country one of the biggest enterprises of agricultural fertilizers

The American Mosaic put up for sale its business due to declines in the market from lower sowing of wheat and maize and the difficulties to turn currency and import

By Fernando Bertello | The nation

 

 

The fall in wheat production and the shrinking of the area with corn, two strong consumers crops of fertilizer, and the reduction of the market for these inputs, which were joined by difficulties to import and turn foreign currency abroad, led Mosaic to a drastic decision: it leaves Argentina and sells its business. It is the U.S. leader in fertilizers and the largest producer of phosphorus in the world.

 

The news began circulating in recent days on the market, and yesterday a company supply admitted only to the nation what are the next steps in the country: “We are putting our operations for sale”. Mosaic was born from a partnership at the global level between Cargill and IMC Global. Last year, Cargill, that he controlled the business, sold its part and today the company around the world is in the hands of shareholders of the market – traded on the New York – and funds of the United States, as MAK Capital One, Jesaga Advisers and Sumitomo Trust and Banking Company.

 

In the country, Mosaic put a foot in 2004 with a model that includes port, plant and deposit in Puerto San Martín, 30 km from Rosario. There its facilities allow you to move more than 550,000 tons of different fertilizers. In addition, a plant with an installed capacity of 250,000 tons per year, became the largest producer of simple superphosphate fertilizer. It is the first plant of this type. The firm is responsible for supplying 50 percent of phosphate used in major crops in the country. Its sales, reaching 550,000 tons per year in total, between producing and importing, are around US $300 million. As from the Argentine,  Chile, a much smaller market, would also be handled by leaving that country. Instead, the firm will keep its operation in Brazil.

 

Reasons for departure

“They hoped that the total market of fertilizers in the Argentina would be larger. They thought it was at 5 million tons. However, due to uncertainty for the production and the lower planting wheat and corn, today the market is about 3 million tons”, said another source, who said that these factors influenced the decision to leave the country and put the business up for sale. Exactly, in 2012 the total fertilizer market stood at 3.14 million tons, 15 percent less than in 2011. Different projections say that so that the replenishment of nutrients is sustainable at the current level of harvest fertilizers should haunt the 5 million tonnes. “Import barriers and difficulties to turn currency probably also were among the reasons for leaving the country,” said the source, who knows the company’s operations, but he asked not to be mentioned. “The conditions of the Argentina have not been very advantageous with the shrinking of the market,” added the source. The sector highlights the Mosaic company has “assembled for a larger market infrastructure”.

 

In the parent company of Mosaic, they believe that they can sell the same products through which buy the Argentina and Chile operations. Competitors as Canada’s Agrium, which here manages ASP and is a member of YPF in Profertil, or Bunge, Dreyfus and up to the previous owner Cargill could be candidates to stay with the business, according to an experienced expert on the market. How much can be worth Mosaic in the Argentina? While the growth of the market potential is intact, despite the reduction that had, various sources agree that by local uncertainty about business the eventual sale could not exceed $ 50 million.

 

http://www.lanacion.com.ar/1633798-se-va-del-pais-una-de-las-mayores-empresas-de-fertilizantes-del-agro

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