Nutrien (NTR) 3 Nov 222022 Q3 Earnings call transcript

Good morning, ladies and gentlemen and welcome to the Nutrien 2022 Q3 Earnings Conference Call. At this time, all lines are in listen-only mode.

Following the presentation, we will conduct a question-and-answer session. [Operator instructions] This call is being recorded on Friday, November 3, 2022. I would now like to turn the conference over to Mr. of President Vice Holzman, Investor Relations. Jeff ahead. go Please

to Thank XXXX quarter welcome you, Good morning, operator. Nutrien's conference third and call.

contain material As forward-looking we these differ future prospects materially about that conclusions we information. conduct this actual contained call, expectations, various and forecasts. from plans results in those were information. applied assumptions statements Therefore, make forward-looking making Certain could and our in

opening recent factors current well Securities before these take turn about Canadian and report, most quarterly as and Ken to comments to information contained with our call President assumptions the annual Additional in Commissions. we and and Pedro as reports shareholders our filed questions. for now information CEO; your annual MD&A our are Farah, over Seitz, I form will U.S. and CFO,

geopolitical and call. deliver third has welcome shaped meet of actions company to and energy and Nutrien's our has security. our value been the position demands a focus shareholders. of our food responded events taking to for have morning on quarter superior that Nutrien XXXX number customers Good earnings by heightened that long-term world's the strategic by

to generate potash inventory in two conditions the significant business. work was early year. demand built through in and America the more the had quarter as that for Therefore, XXXX. record prices a on markets near-term largest the But as in third Nutrien's market previously of our more acknowledge year the demand regions and far represent in the second that impact half volatile potash. been North in These decline earnings in have than expect Potash We anticipated. Brazil declined

additional our target review EBITDA outlook and speak potash We record on fundamentals and it a trade, delivered the which to and that increased other presence stocks this as the higher third Canpotex from temporary supply to large rapidly was changed. incentivized to plans an which than down products, in fertilizer of quarter outlook. do the million third third as half, most closed chemistries. continue record supported our a Brazil a these nine fall annual low. results and sales inventory Casa this months constrained many supply North results will commodity fertilizer XXXX. for retail margins for century cost meet driven that are no demand. confidence And supply realized Southeast High and proprietary year, American to this ability more Buyer strategic for in agriculture we to were our to carrying in the remains Retail higher built expected the believe condensed buyers sales to a first volumes market. Shipments contract China. included Brazil, Marca initiatives of substantially through to than increasing in to our quarter due from prices constraints We notably export bring we in export products. supply purchases higher as partially view with our had quarter products Nutrien delivery for Brazil volumes quarter and volumes offset the in significant crop purchases proprietary provide more and deferrals the We're and of maintained first national during were and pent-up XXXX. advance business. demand delay potash, costs by $XXX has acquisitions And capital increased our as impact and potash for third Europe. that In low ratio Russia. was our sold of will Agro the in continue in restrictions in has a positive crop tight nitrogen exceed first strong, growing like growth on Belarus and restrictions use moved to to allocation to EBITDA tight, beyond energy quarter of for the grain and XXXX. Adubo Pedro slowed product the Asia multi-year track growth will in on fundamentals. carryover based I from to our declined we advance higher were view the of to in to Therefore, lower Global for Nutrien their adjusted to production Demand we Spring strong producer projected our led But quarter in by in not This to nutritional in protection made crop growers very a global of environment, a crops. the and season. year. invest Costs. the prices fertilizer remainder business low well higher However, delivered persist on

the Brazil declined potash the realized North average second year, and the above well Our reduction America. price in tracking from quarter, spot previous was but prices in

movements Russian gas few supply of restrictions last to the decline season. plant prices and application a products. Nitrogen associated strengthened due in and Brazil the inland well costs curtailments U.S. the prices has nitrogen been European and by have higher and supported as the weeks, Fall as strong to restricted Chinese on pace Over slowed, benchmark barge start continued

nitrogen increased in field were the seasonal down higher from exports experienced gas to that primarily third quarter, and the the However, curtailments programs in of that realized exports reset production impacted our summer trailing impacted our but were of offshore supply quarter. occurred late Trinidad the in by markets urea. as solutions quarter prices netback second We

our products. solid phosphate diverse value a results delivered feed and including Our having industrial high business supported more product offering by

fundamentals of by a recognized Over our the margins. reversals impairment and market two with favorable is operations, the million improved view we totaling quarters, which past associated non-cash $XXX have more phosphate driven phosphate

bushel the stocks favorable December and declined. Fall protection in provides has grain projected normal decline and global and yields. out mentioned to weather acreage in would stocks is are of indicative more XXXX. levels, Crop $X have incentive the maximize phosphate the that to outlook, the than futures of and the rapid will products. harvest recent This to growers to opening, have which margins years. that of level application an rates the to consecutive lowest sixth large strength XX support mark to we crop fundamentals, increase per in season multi-year use in turning above in Now ammonia to potash, Prospective North pace a historical trading higher moved futures America, anticipate as above The market weeks application are corn with average been crop for and push well year

is sales anticipate of grower and strong October retail season months. few up over X% Spring previous planting from a to demand. the early soybean with is fertilizer the next volumes by favorable Our of were supreme robust a similar conditions in increase Result year, purchases acreage input to which X%. in is We indicator proceeding good and corn increase projected acreage

fundamentals and fertilizer will emerge drawn And drive agricultural potash demand prices robust inventories down increased XXXX. expect as are consumption for in We will stabilize. pent-up

sanctions constrained. in production are potash in related Russia supply However, on exports continue and global the remains war from Ukraine. the and that situation on current that Belarus, Potash to is impacted Europe to Eastern unique restrictions by be

XX still exports to For down between and to down be XXXX, XX% Russian to potash be million to we in which forecast unconstrained up to exports compared well XXXX projected be from but million XX%. XX XXXX of XXXX, demand to Belarus is our over are tons. Global XX% from XX to million forecasts levels, XX% below shipments tons

prices following remains increased and XXXX. to supply expect XXXX. of remain in prices, gas Despite XX half tons and more Based on and in and North supply outlook, one-third high approximately fourth anticipate sales We remain the through recent prices decline that occurred volumes production is and second European of destocking the million demand are in a next benchmark the in than demand ammonia are we European through and Global Europe's to gas tight Brazil expected nitrogen quarter of year. volatile projected America Nutrien into the strong winter. this curtailed

tight a remainder lower import due I to in half to Pedro record volumes the of our and capital it assumptions year. second of balance and review demand exports nitrogen XXXX. anticipate and to for guidance American also We the and supply over plans will North now turn allocation the

$X.XX Thanks, a our impacting application starting And billion, which range $X.XX EBITDA in retail, The wide range retail for record to America. significant to season factor which fall to business. we billion a our extent North is the continue is our year guidance Ken. guidance most increased have open annual with

fourth chain stabilize around prices restocking guidance revised that quarter. assumes see supply levels Our spot the limited of we that potash current and in

maintenance in double We cash in have this during impact plans position North with narrowed in in been is recent season curtailments nitrogen $X but from in our at line XXXX. projected near-term, Trinidad. generally our which in gas a down fall sales previous activities downtime range production Cash volumes the We forward operating volume benchmark application the previous to reflect guidance in guidance anticipate as our for that our adjusted ammonia approximately XXXX. us roughly increased from ammonia We potash nitrogen is but urea and prices activities billion outlook, of well the have have still America, operating and generated brought have XXXX, lowered strong our forecast.

high Ken in for and invested intend acquisitions initiatives and to our to on to million billion this on grow the in capabilities. year and $XXX we to return remain investments in In our invest products retail, geographies, make and enhance business digital offerings confident core network $X.X growth we strategic As have the proprietary sustainability continue mentioned, approximately XXXX. outlook long-term

our at than annual sites We has are through projects. network that team cost expected reduce completed nitrogen to debottleneck equivalent decarbonization emissions XXX,XXX projects more year low tons. by are this The COX enhancing and brownfield nitrogen three

sites. the projected is across multiple We project increased final margin cost an Geismar are option These for expected agreement up milestone with the in cost [indiscernible] and scales XXX is we making in gap. and the of and supports project, with a advancing key the work a capability. incremental ramp provider. risk decision engineering and the close of The be for potash, period. upside low as opportunity ton, is valuable very short given low low XXX per nutrient and projects to supply potential believe investment come and that as production the balance front investment projected there XXXX. signed payback to ammonia our recently to demand supply spread Therefore, execution global a continue for million capital progress ton And symmetric technology low potash cost we a This X.X production and the to our clean end anticipate

Finally billion XXXX, intention billion share plans return capital. on shareholders quarter, returning for announced including we Last in in approximately repurchases. capital $X for $X our return in our to to

repurchases may lower While February our completing some We'll next now prior extend XXXX. existing still of forecast in in share program first into to on these flows operating to cash XX% due repurchase expiry quarter the intend XXXX. year, of

As decision significant the in we future share reduction time, target dividend included share in the over count sustainable growing per and criteria dividends for increases. will be

Now to it I'll pass back Ken.

growing strong, Pedro. not comments. feeding The just remain abated. for very a of has make final the a would challenge and our longer-term few I Thanks, business fundamentals world

seasons. strengthened. be global addressed the of and have to that's the business over the stakeholders fact, will our over past my meeting past world opportunity over this In for needs our on that year, growing evolving further seen ahead for optimism pressure quarter, food only In growing need serve we several has supplies to with

chemical our the business few call Vice and to President and will the today. Executive taken Senior of potash business. start been Chris evolves, Reynolds He Trevor experience executive our that well our for and with for leading previously our Nitrogen as Williams Interim sales is since initiatives. has to Nitrogen years over large years on XX President with and XX Nutrien global is a year. organization leadership also has of President Interim on Trevor our as has of leading over people members and the I global growth strategic Potash of positioned was diverse been our role of new Operations. extremely served As and team of so the Vice Potash. of Nutrien introduce has He operations are most lead Phosphate. Chris new our President wanted recently President

take with Chief the President Nutrien Thompson, for has you over our questions. that units and met created all addition, In commercial across Mark Commercial strategy. on his we many Executive Vice who the happy taking to a of extensive XX years now role and have global will advance of past, Mark be in Officer. experience introduction, been would business newly With utilize working is to our your

gentlemen, Thank for you. session. One begin your the Ladies question. we [Operator first now question-and-answer Instructions]. moment and will please

first from Your Markets. Please BMO Joel Capital question go comes Jackson from ahead.

Hi, Ken.

up market, competitors It's But you happen. spring build to interesting good the potash. the why inventory what's demand an So I was you we going and of some potash. just tensions. straight and in with mean, you known that the your in the that to the year right, wasn't situation restrictions the and going in -- possibly have could made as on expand must going were that do decision as June thought to reason when it obvious Can

And leaked at higher that a what to for make and to million I will this to Is this On thought? But got more you Russian Xst, how have has on the story tons have was worse at XXXX. market. [indiscernible] about, this And will what elasticity for issues, year? the be multiple your rate on right thought out maybe year? it's production based for prices what be January was years. XX world nutrient than demand you. can production be PPC demand you Well, wrong? than for entering ton? talk capacity Belarus should Thank that Was you decision need then the You understanding

for you the Yes, question. Joel thank and good morning

look and a application really we can the had market about in we we what's And Brazil. with of talk things. about fall North can strong is if the North in at And yes, So XXXX, America. America, fall XXXX. happened Starting we two talk

to there strong certainly And of fundamentals, the very course, and looking in all late weather season, of lay yields. so crop season. for start a nutrients to agriculture growers, appropriate spring, spring looking compressed incentives maximize and planting down the But a to a we're ag year, backdrop heading into the led in which to planting the of at this with the XXXX the

saw and at we ground carryover We And about and America prevent in plant through the end we therefore acres. season crop of saw saw than North we crop said going and talked in to so planting larger the just volumes was have nutrients spring switching the anticipated. fewer we the summer had

at bins in at on minute the the looking their purchases have season last over incentivized purchase. price what of And until and heading at fall, But just now bins lay to to and seen also farmers down start strong. so summer the XX% above nutrients, fertilizer the see And we've looking until application the off nutrients. and the holding farmers very appropriate here. lay crop average. XX-year down again, into mean to in the fall, is their backdrop has I with incentivized been Farmers again, the wheat they seeing and corn crop the We potash and the those

we've again, down coming North seen in so inventories America, now. as And

those we inventories. to pricing with into are starting this time. going see we're with at the to getting the In $XXX that short of that And movement We'll in application see -- per for period. to replenishment Midwest spring. destocking fact, start ready we're the season about to again, through now And fact fall going see

the sanctions into that of So strong interesting Brazilian Russia be year farmers that volumes, challenges really looking And the and and we could there the year. coming distributors Belarus. was America supply previous a year knowing and was Brazil half because in side on first the above shore saw year was and with the the to Brazilian well, Brazil farmer that again, as North XX% imports the in up what having Brazilian at

big going being up but market the sanctions, and inventories with And so But they're those to volumes their starting ton. prices this saw those crop, planting the Safrinha again watching come into Building now. to down. will midst be And prices get need market we into And in to through look only Brazilian Brazilian to which step season, when again prepared to inventories the down, their effect. really country those that case those forward we're underway, take application inventories and those need looking of And those rebuilt. drawn period, prior reluctant Those so in liquidity again Brazil, be corn course $X,XXX through now is farmer feel season, replenished. what biggest the of course, potash step again inventories able we and And saw. to of again, purchasing the summer terms over Spring of a fly market into big that's to the price that, planting us we to export when season constrained. the similar of two markets to of are really the trade over our it so for behavior. farmers in largest the this for some But as

situation. and frankly, getting heading Russia. having very parts Again, sorts XXXX, those mines parts for is and sustaining production, expected, and but are XX% played out hands we strong that full are around also of and the maintenance backdrop We Belarus on they're very are we out And of of had things. of in know volume Ag Through essentially we numbers. the of These the into we that in big those their fundamentals a somewhere constrained situation. levels trouble a heading export Belarus, sanctions of that into effect, similar that world, see and coming see out is export a as the supply Russia that out challenged playing XXXX, see XX% Now as XXXX.

be constrained. destocking are they're rebuilt export be heading potash supply those disproportionately. respect again, the would to Brazil, inventories and With North to side And to increase So going replenished. changed. that in going was to Joel, where those to say The to it low see the we'll that need feel fundamentals in for that as markets be again, places for we like quarter. challenged, be volumes, continuing side, the our a continues going view through And are new But that inventories into be to just be was in big production been to into market need to again, again, XX% had replenished XXXX, XXXX. us We from decision a period, we've America our third Ag of come remain the years here over going strong. Russia know above to that continues over five the that and Nutrien's has backdrop supply and in demand to the We production a that the coming next Belarus. see not market I

new continue challenged, be around our XX that expected will to We we're by up at million that that production tons and to schedule ramp have maintaining XXXX be conviction that. and

XXXX volumes to around head with Joel, in your we we towards be again that restocking on we So guidance and refined will million to a that more XXXX, mentioned that But as year. to get have we we sales February. expect Nutrien entering about XX that for question level, expect ton strong

I'm Your Please next ahead. go Andrew -- comes RBC question Andrew Wong, from Capital. sorry

quarter, we call Thanks. Good wrong morning, on wrong a could I me were I guess all you guess. because

on it's fair of year, now moving and tons have visibility a I'd lot it'll be to XX.X both. say a also potash XX lot at demand million is that on set we based parts side. tons both supply right sales year. guidance. on this There's next Capacity be also, less Looking million around And

up view confirmation it capacity. does of some with the see ramp-up some before and to see to of more to Nutrien positive sense continuing sales here more? demand just kind more to And catch on So for make kind

say make and that, question, Yes, thank are I'll our what And we capability that ramp-up for is the in these our production capability incremental. you investments Andrew.

XX So all jumping to from one we're not XX million leap. in XX to tons

capital all on go And again, But XX is to today, are wheat we strong look at And of agriculture though at Andrew, fundamentals. we backdrop that and bushel market. and so, to the do corn, futures and mentioned is where what do the ground and so those again, we above we'll the for the out likes going back be and need corn to the strong, allocate are the are ourselves XX% pricing and trading in I prudent with Ag where year see average. commodities in how above XXXX the say in $X for of to even a light

but we've then So know a constrained backdrop, strong got that in supply we this market. we're

tons constrained when we so are an around supply tons, especially somewhere because in unconstrained in that's where it's rebuilt. And say it's view, XX million And environment million XX you'd XX to market. say being a in inventories XXXX,

believe pacing there's So, been real, supply for believe, have at home it the about these our and say proven we market. volumes a we expanding XXXX, the side But market. XXXX for with that looking be to would continue part, capacity going I our XXXX, challenges we are to in

question Your from ahead. Christopher comes next Parkinson Please with go Mizuho.

Operator, question, move the please. we will to next

here. Hello. Hello. Yes, I'm

hear can you. We

segment of. capable much. As nitrogen pertains on any are Can side. natural just of would additional of me was on little what that that to estimate, dust side, basis? ask Are you give on asking, now? thought bit now normalized and and again. There's have way your it a gas and idea reaction the of we just the better all Ukraine have you flows All a sorry, settled, to adjusted Russians the it Thank of EBITDA thinking has since process and Belarussians us given the very potash prices the helpful. the and going you to trade on -- $X initial the war hear little just on billion takes a be your a right, framework I'll bit any specific puts the very volatility I just

I that few both it what But, Russia Mark energy then I'll going medium challenged nutrients that, seen provide out Thompson color. term, in in some just to export over for pricing like. restrictions think Chief And in the us we've is we've course, and talked price and with world, of shift strip Commercial that to structural Officer, in parts the in differently other given I'll and what of do pass about the of industry Europe a that our looks Ukraine, provide what makes That in pass it of complex we've a the say challenge we to for are past. a But I'll the experiencing that more think to you present industry. terms crop changed shift and over some thoughts, to exports hasn't about suffice our that us, believe over Belarus, color. continue in it to provide our Yes, then to the structural seen and that the we Mark, there that's midcycle conflict opening

Ken here morning for Chris. the the at you, think I in Look, our again, has around Ken that $X when to range the we Good the projection for normalized Ken. follow. And on business, this to the for potash we side. come see in any fundamentally, And Nutrien there's look had we very view that is needing said. to thank Yes, additional will market midcycle EBITDA. see think that clearly components from potash around tons what reiterate billion don't so years one and two stated just that, different mean, volume earnings to I morning, and I continue

Ukraine that believe that specifically much the believe When of out that Belarus earnings. that level see we supply structural a at intact. constraint pricing support in fundamental result double normalized variety we XXXX, then from we and way, be look same that effect. possible half saw standpoint, XXXX ultimately in in the we had here some click will again markets over in XXXX XXXX demand TTF of that, Russia, don't of a take see forward the as situation Ken gas full that strip first the these past that of future. gas foreseeable would we seen for view the reduced standpoint, surge constraints European in so, is ultimately Ken standpoint we in continuing in for there's said, leads in and And now again, will and producer as will to we've from the And from a that of way high firmly has the Ukraine And or as indicate, see on cost these a conflict warmer And standpoint, On said, the in the of same played the result factors we as supply energy the again ultimately the that that much month conflict the be supply billion $X said. has markets. on we've a imports Europe changes so from a in weather prices and despite result and potash, here Russia continuing Nigerian

in as So major view that outlook were view factors confident that those we change move forward. our of supporting are the markets. that structural in these And we're very

Morgan Stanley. comes Andrews Please question go next with ahead. from Your Vincent

maybe TTF tell or production prices, months, should exactly not. whether floor I been a follow-up community I on European in three in investment about you're terms and the So price it just sure And And thoughts? setting nitrogen European the is think as be those lot these to mechanism be of think actually you might costs, or days price? price. what over Jason, those price I'm the wanted for what aware and or and And five give you your debate, setting four you that that. the what nitrogen There's could the us of personally has in a can't Thanks. setting XXXX? past

one Newton, the pass Thanks Economist Great. and moving to that I'll there, our question. Jason. Jason for Chief Vincent over talk parts about the

Vincent. Yes, good morning,

through saw year. well to if look were they're a the time look when of and and were which production is capacity of low you at global European little where ammonia a in the marginal over depends cost the where of it obviously, XX% at And think demand. in idled product at above that in terms third quarter, we time. costs Europe I prices just point the that bit quarter, on seasonal We've come

need to we look in at I for Europe line ammonia that the where and ammonia, are think, especially on at with marginal a basis, And as for least and and sustained so have prices moment. for we in nitrates costs long-term that's

QX As production that cost drive that that get capacity environment, is. which that's in expect we -- was of still, offline really ammonia demand case, to we it's get where XXXX, more will And of move today marginal in into that's And a above XXXX. third a going demand gone. to driven lost that and pricing into of there's the

full operating given we over we're medium rates the on stream. And term to As continue near at know, production globally. the that that's expect we

so we is supply get of than cost it in environment, less time. as And period realistically, the demand has tight a into demand low the been important curve

Your Please go next Jacob Bout CIBC. comes from question ahead. with

share? in price? what to China, spot does we buyers you market morning. just balance And the pricing the industry. what to U.S., are inventories but isn't talked India, your in? in the step potash Good primarily Brazil, about versus is incentivize and in you've In about I supply on the view, on How Historically, know, look sweet of what used new like talk focused pricing? that

Thank you, Great. Jacob, question. for the

now. decades have the customer over approach built we we as So market, base our

customers grow. and look with And to continue so go them. needs we along it meeting And the of we our at our customers as

sweet the that do. the So -- at in farmer in center the we of I mean, today pricing is we terms pricing, of everything of for spot the ultimately, health

we incentives provide spot kind quality us, of we that's that provide fundamentals, so crop which Obviously, mean, for some the course for that demand nutrients with over seen just quite do. the of volatility I can the of crop really We've that's on based producers among seen in really to of the across supply side high sweet supply we've on the challenges that been that And pies, and again, backdrop pricing. XXXX. And the That's crop nutrient dramatic. nutrients. market, the egg the affordable go fundamentals. and

market of supposed that be coming majority the Belarus look some as is see or course, out challenges the again, new of given to supply of we the of come the new So now, years, with forward that that five the Russia. supply our to and we market, next supply again, and was that's to and to going

the yields. come And Today, to the so what's market and therefore coming market think there, incentives it. just is Nutrien's. crop yeah, incented appropriate maximize ag And about fundamentals for the that apply our and farmers is again, I the say would are really the way into the part, into we backdrop Jacob to that's

through this we've As gone destocking period.

As I northern be be what season there and the in will planting in season a for big and Safina ready will restock incentives say, Brazil farmer the the hemisphere. for get to big a

that causing farmers distributors So and the the step be to into incentives are will market. there really, and

with Isaacson Ben ahead. from comes Bank. Please question Scotia next go Your

it Thank you everybody. the on means good much. and And Question prices for very business. potash what morning, retail

about earns So went a when I to year. up That getting this segment back look a billion dollars crop billion and looks profit. a to retail, nutrients generally $X at last it about a year and of like billion close it the year gross to half

billion impact be of like this in Your and mean, as you. is goes nutrient year the your that $X retreated. year, prices I next for too, around about crop guidance down. we thinking of now gross in should $X How potash bit that to north hit EBITDA $X XXXX have you profit How something Thank however X.X little around do retail a billion EBITDA that? billion expect X.X

Crops pass morning Great. been shift Ken in mentioned lot And still now, an Well, I both one margins Tarsi. seeing point band. about obviously, at the margins our just But you a for in fall, for margins XXXX basis, well. we of And amount tremendous us standpoint. to a And and rate. as And talked give ground an Jeff very into yield to in the right have of seen this, again, like have out from such I look, And, time, whatever are look 'XX lot 'XX. talk question, see, every from it -- the thank little about even basis. science come a input bit and what step a retail as they're that. these this give, to maximize we're value think going for Good when it And strong, decision up for going and at again And in at acre and we nutrient and attractive, over from a becoming more that attractive Ben. based are things, return And planning when I'll historical of still are growers opportunity that earlier, a returns growers a are value. a 'XX. putting seeing they early. these they're of it's some a very Growers would to we it'll crop be we're a to momentum historical decisions. is to

the 'XX. So of think strong we'll end through see again, I stay margin

up a As reset tight low. something we'll the like historical. more we'll and that's in what If ourselves because saw good inventory -- looks we'll our we with to be step starting it think again, we we in get from we're we inventories a will bit XXXX. get from standpoint, be position fall, if have an But a 'XX, return into I

Credit from Please comes with Your next John Suisse. question Roberts go ahead.

Thank you.

Edlain John. behalf this Rodriguez. So of On is

prices? now, stocking Speaking continue? on with and year? products Any concerns products right increased that's put nutrient next like how pressure Europe will do And of you this could coming going the that from further Eastern on long the out this of think production more inventory,

for Well, thank Great. it over Mark? pass I'll to you question. the

for the Yes. Good morning. Thanks question.

to ground. I that enter on globally, we that at I a stocking Ken's Brazil, And look or product like And look we a think begin do America, in of North and think good North going the and at XXXX. seeing we with we inventory markets growers when saw exit the inventory as of that's products are of than is crop terms up look again, at the currently. attractive engagement of in lower inventory least levels very in strong sets destocking some as a of I in where mentioned, again, entered at of continue really that We in we just picture today lot combination be we'll same XXXX commodity prices in see step seeing the and the growers in half movement again, to believe are markets we And period process year, we're second Brazil. if to through the see even at us, we pause perhaps So Also, reiterate, And are comments. place. seeing back importantly, we straight Ultimately, for think we take that from not as that we market earnest And that would at Ken this going key the and to for market. pick America demand XXXX up momentum. destocking point. to expect potash and beginning that

I Ukraine, we think were sanctions first Former out remain exports here again, up first continuation XX%. exports And on based from of Belarus the of including the fundamental down XX% found XX% terms is in the the the remain conflict imports of in expectation that of to we in half in that the surge significantly in Soviet the disruptions. where Russia of down a see XXXX, physical half and And the today, that from markets, saw year. its global about fact and what the product anticipation Union of Brazil, of into factor way product

same of will head like markets enter situation just we as supply Brazil, type situation that be XXXX. next As we in possible year, into not and import

a in will yet we see so And believe supply demand not way been that in tightness the the that's seen. market

And on about So are as that volumes be the to And see that as begin believe going enter are flex we to up ability that in we to Nutrien inventories that production of combined talked needed. speak. demand, with terms destocking again, we our we'll our XXXX. we've view

America. with of Please Steve question next Your comes Bank from Byrne go ahead.

into recovery in Were more inventory corn of yours that potential business are rates high competitor almost into contract, got some now channel the guidance you China, and on XXXX is be characterizing now than be little looking in potash rather that, ground to that your And the sure you going low Are in on was shipments application is drill on as constrained, actually potash. your to yet they bit to the you demand for there above domestic the U.S. And normal what Yes, going that's they it zero is a or a listen until the Canpotex four normal, more belt funds or in just levels pricing and a down XXXX quarter. to in to September? term? by potash that normal? that Ken so was now? markets unexpected one What ran the effectively now. are And they sorry, front. got view setting a actually at I'd the the underway supply like you ahead in to retail seeing would hold to you But retail Canpotex is, would this in near off have be contract this potentially the past view actually

Tarsi retail we you talk the the back the Canpotex thank again, on then I'll the relates Jeff seeing to what in just to a with, start quite I'll for just it I'll what And compressed and about Yes, space, and volumes. then Spring saw hand we're piece. come sort of to maybe so as Steve. And question, bit Great, there's in it there. North America,

farmers minute at inventories to as look anticipated. So season with and yes, will summer watching in of more knife Spring in application America that. soften. North carried on the buying prices And seeing Jeff at again volumes so about that price again, That America and been last just the the catch say in from that talk falling we're the just our sort off August will And a ton and engagement in pricing. we call to it see to reiterate, application larger that per do $XXX carryover a this holding North program place market announced were drawn of than we August down. been again, beginning We'd normal season And over that inventories with there. had had have we at season not so we we volumes those were Midwest wanting the the

and contract. about going buyer ground buyer were Jeff, place. then and the we're I market, come in that Steve, to a the behavior it is to what and we is think larger just on yes restocking carryover XXXX to low back anticipated, call answer given it retail pass short now take So talk to sentiments a bit the just you the than have I'll seeing those I'll on little and volumes

market, big planters talked lot And got we and and for always morning, and to like down the good into and when then Steve. a we versus real falls, growers of hook this we've compressed look, 'XX of 'XX. spring. about put But plant had the falls year a decided got product really 'XX some the I quite into remind to were the people Fall Spring big a just two and Yes, bit to

last product we're pure to wouldn't starting spring, we retail [indiscernible] plan perspective So position potash, carried And we carry. coming application came with little layered the I more out in. as around, Nutrien rates, week, more from record we Waypoint a I that I well talk cutting call when back decisions. now the going application testing based some a to what of and soil also remark we was this three out bit around our market a in testing run the of that These are than and bit days through probably rates, as Analytical yesterday, into nobody's big back science say But overweight last made And calling which product now. and at week, At And on was earlier. they business. product. had I for soil look over

soil we're with the it to looking areas if not were is be good And corn book, crop there was strong. doing we And were was be soil as but out an removed expected ahead better year. at need. areas very that early replenish it some to we're that growers and seed looking that bit acreage than, So I'm certainly crop was looking appears looking these year. what going weak, to they going nutrients, testing, this year a next little next If removal to at good, the are from to at

in we in to they return expect were would 'XX to And where so in volumes our 'XX.

you, Jeff. thank Great,

Canpotex your question markets. to Steve, just the back on so contract and And contract settlements in

just domestic China supply price not fact, the yes, frankly the suppliers supplier maybe it domestic and settlement can that maybe by is softened, the a price is in and that contract very true just under the way, in few negotiate in suppliers in a probably and Canpotex the world. one on America, far China or that So does quantity of meaningful global but has negotiation that and level, dictate we're the Brazil, talking market. a to two between going the about is in find anywhere other whether will seeing as we've said And And but and spot North current be the are in a market is based this is the you it's driven price below we $XXX what demand That contract market. per not in ton.

be parts certainly that. going those season levels of is for and in of world, in for standard and renewal to for have intents inventory contract India potash look we is all products we're We the know and Asia, to step grade fact, above at their Southeast out that in In same. do well that will be volumes the that to country grade planting, and trying certainly we Again, at spring season the accordingly. before markets, Canpotex are their will get where and into planting we the negotiating and standard to looking expect they'll at for have volume trading before internationally

ahead. Zekauskas from comes Please with question go next Your Jeffrey JPMorgan.

much. very Thanks

something potash your and demand India Why you are XXXX can two it Ag in that? that a is of costs your or way it is was of for you where Belarussian are your you in what that in a Solutions XXXX. Sort Russian business, function margins? inflationary at these below Is part about away else? that where forecasts do then XXXX, And shipments question. and for were is In eating

questions, you the thank Jeff. Good, for

over on in relates what Newton, we'll the discussion Jeff we're then it inflationary India so business. And start as with to volume. for pressures of Jason retail potash Tarsi for And our to forecasting

given subsidy relative in increased control the prices challenge impact major the market has the the which had morning, been maximum profitability importer an the a year-over-year, good the within negative addition where price, from is domestic retail has grower regulatory domestic India standpoint to Jeff. and to The retail maximum demand. on both Yes, with Nutrien base has

said below grow policy when environment what rates this probably economics why And within import to from affordability in optimal XXXX. it what we're And we've and a expect an were so XXXX, but they in it Xx makes they're be we seen back perspective, the still that India year. challenge grower was as and environment high to that's weakened Xx pricing remain and XXXX well in a agronomic where you would in demand global

in so that we'd different expect a that policy And in market. environment, growth in strong

through we from part standpoint. second we've to we've think of as see any what that XX ratio, obviously, and quarter, relates operating look industry third improved from like cash and inflation, also the I if does Yes, that, a you XX. from done it inflation, But coverage

chemistry, margins third our it's and think on were market. apply as protection is up XX the that to up the that, crop fair chemistry and you So we've was think And we're points or around basis always with keep or of moving whether that protection, obviously, to a through fertilizer And seed on our focused side see up go up, roughly job structure, I this rates margins crop very Nutrien's goes margin attractive trying from on charge up basis our done points And, our it that front I very standpoint. the into were know, quarter our in XXX up business, fuel rates were of expense forward. year, this as year. strategic we application we we

hard big in. tune of And what we've show I to a think done of pass a side of of in constantly some worked Obviously, results good matter that that are no we're I our to costs try that. job we'll we're the today pretty business control we've side it. And So that to through expenses, customers that. the done today. on we've our to that think the business But scrubbing people staying constantly environment we've

Please comes question from Juvekar go next ahead. Citi. Your from P.J.

of had share, seeds what comments Dyna-Gro. one And been expectations your morning, seeds. And on put Yes, out U.S. market price you in I seed then gaining a based large is on the was cards that? earlier this pricing seed question on saying any then have that company share the based year? What that are on good have been they hi, channel. wondering if retail for has been the

PJ. characterize competitive Great, a pass the single-digits. season, through mid always our go third over kind I thank will we of arena, just quarter Jeff be quarter tarsi. start that to it fourth Yeah, and we prices off kicked If look I'll up it only. as you, a standpoint, seeds, the selling that from price XX probably upper seed it we to I at book characterizes from into

market a we from it we soybeans X% year. 'XX to season, those as say, the the share. price And well, of range out. and up from have have the a and We XX a shift Texas basis substantial an particularly somewhere kind corn supplier price going to points we market. increase the growth weather, with was hybrid some the it's across in perspective, crop really rice pleased were cotton, saw we From For it. let's I'm everything soybeans from on significant data we up. to that increases business, hit share for tough with from books areas that you know, lay had to where X% And XX share with of depending look back we on a and our associated relates see Look, some had in share seed and is this the very and with large because standpoint, had a again, couple market really seasons. areas, as had good year we a are that,

strong, So as grow. with canola. data our in Brand associated our Canada very as well remained proven brand

go next Hansen Raymond ahead. comes Your with question from Please Steve James.

morning. good Yes,

upfront will the described. I respect the expansion sticking a just on capital it the the here incremental we in million remind can are all how Or place strategy, three million to contemplate line as capacity the over for hold given you potash you or chunks through? But making Just next you those the decision the outlays us those can predominately down years? investments, incremental X come tons the to will come backdrop theme. year tranches effectively as tons today

well, who bit It's Yes, along Steve. saving pass Great orderings President Chris that. Potash. but of but capital I'll it no. little We're question. Reynolds, the line Thank oath. then a for is items, to our as you over of

stage about to morning, the $XXX And productive we've To we are Good million of of that reach by XXXX. $XXX date, investment Thanks just capacity for million yeah, tons committed that XX Steve. looking capital. million that question.

given And it's in going be imagine Ken secure is sure of shops been haven't And that actually we can date. our to to chain place have too which so can lot committed staged. as queue bad with a lead said, to of we supply yeah, getting you items. sort some was already long But certain remarkably, that to million as challenges, make equipment

about very still good we feel So investment. this

that demand, the And market view forward. and Nutrien a Pedro is take investments in the the mentioned, and incremental making a that that be As these volume really to in to believes the going opportunity have going need that making these we when QX Ken investments. position world pause long-term meet strongly to we demand and and despite saw allows

around investment. temporary not conviction demand and again, pause we saw derailing QX, this in So our

from with comes Please question Adam ahead. go Samuelson next Goldman Your Sachs.

morning, subsidies. of parts. your -- on But Yes, pretty on thank side. about Maybe cutting two in are about really just in being Southeast Good get inventories the We continuing Asia. sense dry there There's One, India discussions inventory being you. everyone. potash. talked also kind

this maybe do next connection the have think been wholesale has like affordability it year, And how I would where the to might its we you've year the and we different of -- there the potentially lessons to and internally business reflect differing acting the what retail that, if imports, to and how was on just going kind internally? the if terms is just worse? business on of business we progressed, And this potash to of in seem inventory how Thanks. forecasting be about gleaned So up year between off where there terms just get positioning approaching retail. how then kind are do want market. just And then how in wholesale was of and own as get versus signals reflected the from buying, was domestic

inventories on Southeast thank with on Asia. we'll Jeff move in the Well, start for over you We'll just question, to Great. Adam. with And Jason then the Tarsi. the start we'll --

Just retail seeing to wholesale we're you how it talk about, know, what again, business. our and relates in to

don't volume the And down Adam. we do of strengthen, good we'd absolute on in great morning, data given We is Yes, the to palm up of of start And in oil improves outlook Southeast that terms but calendar the Asia, as have drew know year, number seen inventories we've market federal inventories which And in there that be of India. why and prices the that one the we've to down. know region second come world just was and that firm in We the demand the the see The are the we half. region. shipments low that has that expect economic reasons look is region where toward remained the and which XXXX, that certainly markets shipments the of back relatively the consumption, will what are lagged reiterate already at levels. to extremely talked inventory year-over-year. we inventories just about down rest

huge XXXX. in that low an we in are that increase the increase is while in fact see inventories region so supportive just a so shipments don't of And consumption,

and spring compressed know, again, to late got don't broken a add retail I Yes, want But perspective, and we the predict I'll and can obviously, from into record. a nobody you on sound like spring. the and

We've of and incentivized in. weeks. started were some we three big two And weeks three the important. year that we look, put summer the a because then in they something soul. And that so weather. about season people foul Remember And reengaged standpoint. to seen planter the lot into growers, a behind No, with thing of And come the saw product, we've from field, out mouth they working a you back mine to files some seen had, a again, here the fall crops hand more and they ended of that really this had There's of came fast. the ended the a dry we has way progress phone were the hot, it's standpoint, and the as we started cropping way of from up lot get

at And a -- wouldn't the And that. we the harvest, in so I now, year been would back have would of if where I are man earlier average. ahead I we're five have you on bet year bit look on if

the we've and fall lot gotten as P&K, high right And nitrogen so, good a market really because for for well. about that a got but of talked a really we've now open demand we've

three the well. strong I book as in market NH Canada for and is extremely extremely been Our strong U.S. book has

And so long is hit of love he point as year. the fully open as I product the Paul end expect now, ground at the

turn Mr. to no this Holzman, I at further are over There you. back the time. call questions

Investor calls. for available Have any is follow-up team today. you us good day. a for joining relations Thank

thank you disconnect this your and call Ladies participating today. please We ask gentlemen for that lines. concludes your and you for conference