Are you retail apes looking for an extremely exciting tech name to really blow your socks off this trading week?
Well, too bad.
I’ve got one of the most exciting companies in the world for you.
LISTEN TO TONIGHT’S BRAND NEW EPISODE (SUNDAY) OF THE ROCK TRADING PODCAST!
The Mosaic Company is a Fortune 500 company based in Tampa, Florida which mines phosphate, potash, and collects urea for fertilizer, through various international distribution networks, and Mosaic Fertilizantes. It is the largest U.S. producer of potash and phosphate fertilizer.
Why is this important? Why the heck are we trading a boring agricultural company?
“Fertilizer prices are up an average of 70% from last year,” said Timothy Njagi, a researcher at the Tegemeo Institute of Agricultural Policy and Development in Kenya, referring to prices in the country. “The fertilizer is available locally, but it’s out of reach for the majority of farmers. Worse, many farmers know that they cannot recover these costs.”
Prices have been climbing for more than a year for a host of reasons: runaway pricing for natural gas, the main feedstock for much of the world’s nitrogen fertilizer; sanctions on a major Belarusian potash producer; back-to-back late-summer storms on the U.S. Gulf Coast that temporarily shut-in production in the region; plus Covid-19 restrictions that have disrupted every global supply chain, including chemicals.
That tightening in the physical fertilizer market has galvanized China, the largest phosphate producer, to restrict outgoing shipments in order to build up a stockpile at home, further exacerbating the global shortage. Add Russia’s invasion of Ukraine, which effectively cut off nearly a fifth of the world’s nutrient exports, and the fertilizer industry and its pricing mechanisms are arguably more broken than ever before.
Bloomberg – Can the World Feed Itself? Historic Fertilizer Crunch Threatens Food Security
Even if you don’t play the volatile options market, this stock is a great place to park your money for long-term returns. The fert and potash market are not changing at all over the next 12 months.
According to Zack’s.com, Mosaic delivers an earnings surprise 3.7% on average over the last four quarters. The company’s first-quarter results are likely to reflect the benefits of higher prices and demand for phosphate and potash. Shares of Mosaic have rallied 76.1% in the past year compared with 52.3% rise of the industry.
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