Thursday, November 02, 2006

Agrium Q3 profit plunges to US$1 million in Q3 from US$72 million last year: Our bins were full

The stock price % chart is Agrium (CA.AGU) in blue and the other is Potash Corp of Sask(POT). Both show healthy one year price gains
Agrium Q3 profit plunges to US$1 million in Q3 from US$72 million last year
Agrium is a big player in wholesale and retail fertilizer. I read in this article some problems in it's potash business and some restructuring cost (They aquired Royster- Clark recently). I love the line "Fertilizer margins were compressed, due to sales of higher cost fertilizer inventory in what was generally a declining fertilizer market in the third quarter"
Loosely translated that means "we lost money because prices dropped $100/tonne, and we had a bunch of it"
I think these guys will be OK. They are doing the restucturing that's needed to stay profitable and be ready for a possible biofuel boom in ag.