Mosaic Co. (NYSE: MOS) released preliminary sales figures for its fourth quarter of 2025, reporting that North American phosphate shipments fell about 20% year‑over‑year to 1.3 million tonnes, while potash volumes remained near 2.2 million tonnes. Brazil, Mosaic’s largest international market, saw volumes drop well below expectations, a shortfall attributed to tighter credit conditions and increased competition from low‑grade Chinese imports.
The preliminary data follow a strong third‑quarter performance, in which Mosaic posted net income of $411 million and adjusted EBITDA of $806 million. In comparison, the fourth quarter of 2024 generated $169 million in net income and $594 million in adjusted EBITDA, underscoring a sharp decline in profitability as demand weakens. The Q4 2025 sales volume of 3.5 million tonnes is a 12% drop from the 3.9 million tonnes reported in Q4 2024, and the 9 million‑tonne full‑year outlook is flat against the 9.1 million‑tonne guidance issued in Q3 2025.
Segment‑level analysis shows that phosphate sales fell 20% to $1.3 billion, while potash sales held steady at $1.1 billion. Gross margin on phosphate slipped to 15.2% from 16.0% in Q3 2025, reflecting lower pricing power amid a glut of low‑grade imports. Potash margins remained near 18.5%, supported by a modest price increase in the U.S. market. The combined effect produced an operating margin of 9.8%, down 0.4 percentage points from the 10.2% margin reported in the prior quarter.
CEO Bruce Bodine said the company’s performance was “challenged by affordability pressures and a weather‑driven slowdown in fall applications.” He added that Brazil’s credit constraints and the influx of cheaper Chinese phosphate have eroded the company’s market share, while noting that China’s export restrictions are expected to persist through the first half of 2026, potentially tightening global supply and supporting prices. Management reiterated its full‑year sales outlook of 9 million tonnes, unchanged from the guidance issued in Q3 2025, and emphasized a focus on cost discipline and inventory management to protect margins.
Analysts reacted to the preliminary results with a downgrade from Oppenheimer, which moved Mosaic to a “Perform” rating from “Outperform” and removed its $35 price target. The downgrade was driven by the sharp decline in North American phosphate demand, the underperformance in Brazil, and the company’s flat full‑year outlook, which signaled limited upside potential for the remainder of the year.
The weak Q4 results highlight a cyclical downturn in the fertilizer market, with growers postponing fertilizer purchases amid economic uncertainty. Mosaic’s ability to reallocate inventory to stronger markets and its focus on cost control position the company to weather the short‑term headwinds, but the flat guidance and competitive pressures suggest that 2026 will require a gradual rebound in demand before the company can return to growth.
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