Yara International's Record Q3 Earnings

By Jesus Calero

(Reuters) – Yara International, one of the world's largest fertilizer producers, reported third-quarter core earnings above market expectations, attributing this success to record production levels and a focus on core operations.

Key Financials

• Third-Quarter EBITDA: Yara's earnings before interest, tax, depreciation, and amortization (EBITDA) soared more than 47% from last year, reaching $585 million. Analysts had expected $482 million, as per a company poll.

CEO Svein Tore Holsether stated, "Yara is delivering all-time high production performance and strong premiums this quarter, a testament to the robustness of our operations and the value of our core business."

Market Challenges and Opportunities

Despite European deliveries remaining below pre-2022 levels due to rising raw material costs, Yara noted improved margins from phosphate-rock upgrading and stable potash prices, which contributed to the stronger-than-expected results. This positions Yara for profitability when market conditions stabilize.

Significant third-party sales in Brazil also accounted for the earnings increase.

Future Outlook

Yara anticipates that natural gas purchase costs in the fourth quarter will align with last year's levels. However, for the first quarter of 2025, these costs are projected to rise by $60 million year on year.

Given the essential role of natural gas in fertilizer production, the surge in gas prices following Russia's invasion of Ukraine has led to increased production costs, translating to higher prices for farmers.