Mosaic announced on December 16 that it will temporarily halt single super phosphate (SSP) production at its Fospar and Araxá plants in Brazil. The decision follows a sharp increase in sulfur prices, the key raw‑material input for SSP fertilizer, and is intended to protect the company’s margins and manage inventory levels in the face of higher input costs.
The idling is expected to reduce SSP output by roughly 20 % of the plants’ combined capacity, a move that directly addresses the margin compression caused by sulfur price spikes. By suspending production, Mosaic can avoid the cost of producing a product that has become less profitable, while also preventing the build‑up of inventory that would be expensive to hold when input costs are elevated.
The reduction in output will tighten the local supply of SSP, potentially tightening the market in Brazil and affecting the company’s sales mix. Mosaic’s decision to also suspend future sulfur purchases signals a broader strategy to mitigate the impact of volatile raw‑material prices across its operations. The company has indicated it will review the situation after 30 days, allowing it to react quickly if sulfur prices normalize.
The announcement triggered a negative market reaction: Mosaic’s shares fell 5.15 % on the day of the news, and JPMorgan downgraded the stock from Overweight to Neutral, citing declining phosphate prices and demand concerns. The downgrade also lowered the firm’s price target from $37.00 to $26.00, reflecting heightened risk perception around the company’s Brazilian operations.
CEO Bruce Bodine said the company is “focused on driving further improvements and sustainably higher operating rates” and that the idling is part of a broader effort to restore asset health. He noted that the company’s Brazil business continues to perform well amid credit challenges in the agricultural sector, underscoring Mosaic’s commitment to operational discipline even as it navigates headwinds.
Mosaic’s Brazil portfolio includes a new blending facility opened in July 2025 and the recent sale of its Patos de Minas phosphate mine, part of a strategy to redeploy capital to higher‑returning areas. The SSP idling fits into this portfolio optimization, allowing the company to concentrate on more profitable segments while maintaining flexibility in a volatile market.
Overall, the idling reflects Mosaic’s proactive approach to cost management in the face of rising sulfur costs and market uncertainty. While it will temporarily reduce output and tighten supply, the company’s focus on margin protection and inventory control positions it to respond quickly if sulfur prices ease, potentially restoring production in the near term.
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