Mosaic Withdraws Full-Year Phosphate Production Guidance, Cites Surging Sulfuric Acid Costs

Mosaic withdrew its phosphate production guidance for the year and said it would limit capital expenditures for the year as surging sulfuric acid prices weigh on its operations. The fertilizer maker cited the rapid rise in sulfuric acid costs as the central factor behind both decisions.

Sulfuric acid is a key input in phosphate production, and the surge has increased operational expenses beyond levels anticipated when the company last provided outlook figures.

Mosaic's decision to pull its full-year phosphate production guidance removes a key benchmark that investors and analysts had been using to model the company's output and earnings. The company had previously set targets that are now considered unreliable given the cost pressures.

The restraint is intended to preserve liquidity while the company contends with elevated input costs that have compressed margins across its phosphate segment. The company has not provided a revised production range or quantified the expected reduction in spending, according to WSJ reported.

The developments mark a sharp reversal from earlier in the year when Mosaic had maintained its phosphate production targets despite rising costs in other parts of the supply chain. Sulfuric acid, produced primarily from elemental sulfur, has seen prices climb steadily as global sulfur markets tightened.

Analysts following the fertilizer sector will now recalibrate forecasts without the company's official phosphate production numbers.

Mosaic's shares have historically reacted sharply to changes in production guidance and capital spending plans. The company has not commented further on the timing or magnitude of the sulfuric acid price increases it is experiencing. WSJ reported the withdrawal of guidance and the capital expenditure limit in a brief dispatch Monday.