Topic: How To Invest

What is Pat’s commentary for the week of November 21, 2023

Article Excerpt

The shares of fertilizer producer Nutrien shot up to an all-time high of $147.93 in April 2022 following Russia’s invasion of Ukraine. Russia, and its ally Belarus, are major producers of potash fertilizer and economic sanctions hindered their exports. That helped lift Nutrien’s average potash selling price by 112.8%, to $630 U.S. a tonne in 2022 from $296 U.S. in 2021. However, fertilizer prices are subject to a wide variety of factors, including weather and crop prices. As a result, potash prices have dropped to around $250 U.S. a tonne, and Nutrien’s stock is now 48% below its 2022 peak. We feel Nutrien will rebound over the next few years. It has some of the lowest cost operations in the industry, which helps shield it from volatile fertilizer prices. Its large retail operations—selling seeds, fertilizer and other agricultural supplies to farmers—also lowers its exposure to fertilizer prices. Moreover, the global population is set to rise from today’s 8 billion to 10 billion by…