QUOTE AND NEWS
FierceBiotech  Nov 19  Comment 
The Cystic Fibrosis Foundation announced today that it had cashed in its royalty stream from Vertex Pharmaceuticals' breakthrough CF drugs it backed for a $3.3 billion windfall. But where the foundation trumpeted the blockbuster deal with Royalty...
Benzinga  Nov 19  Comment 
Fertilizer companies surged Tuesday amid a report that Uralkali evacuated its Solikamsk-2 mine. According to Uralkali, “A sinkhole with a diameter of 30-40 metres has been detected to the east of the Solikamsk-2 production site, outside the...
Benzinga  Nov 19  Comment 
Credit Suisse upgraded CF Industries Holdings (NYSE: CF) from Neutral to Outperform. The price target for CF Industries Holdings has been raised from $228.00 to $315.00. CF Industries Holdings' shares closed at $269.69 yesterday. Susquehanna...
Benzinga  Nov 19  Comment 
Credit Suisse upgraded CF Industries Holdings (NYSE: CF) from Neutral to Outperform. The price target for CF Industries Holdings has been raised from $228.00 to $315.00. CF Industries Holdings shares have gained 25.75% over the past 52 weeks,...
Market Intelligence Center  Nov 18  Comment 
The patented option-trade picking algorithms that power MarketIntelligenceCenter.com's Artificial Intelligence Center are highlighting two trades on CF Industries Holdings Inc (CF) today after it closed at $270.01 on Monday. For more conservative...
Forbes  Nov 11  Comment 
As the saying goes, there are many possible reasons for an insider to sell a stock, but only one reason to buy -- they expect to make money.  So let's look at two noteworthy recent insider buys.
Market Intelligence Center  Nov 10  Comment 
With bearish technical indicators and a 3 STARS (out of 5) hold ranking from Standard & Poor’s, CF Industries Holdings Inc (CF) could be an attractive play for investors according to MarketIntelligenceCenter.com's patented option-trade picking...
Benzinga  Nov 6  Comment 
Shares of several fertilizer manufacturers fell Thursday after one of the sector's second-biggest player CF Industries Holdings, Inc.'s (NYSE: CF) posted disappointing third quarter results. CF's revenue for the recent period missed Wall...




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The company is one of the largest manufacturers and distributors of nitrogen and phosphate fertilizer products in North America. The company's operations are organized into two business segments: the nitrogen fertilizer business and the phosphate fertilizer business. The company's principal products in the nitrogen fertilizer business are ammonia, urea and urea ammonium nitrate solution (UAN). The company's principal products in the phosphate fertilizer business are diammonium phosphate (DAP) and monoammonium phosphate (MAP). The company supplies approximately 24% of the nitrogen and approximately 12% of the phosphate used in agricultural fertilizer applications in the United States. North America accounts for 91% of CF's sales

  BULL POINTS

CF is a leader in US nitrogen. The company has one of the highest market shares in the US corn-belt (30% nitrogen, 17% phosphate) making CF the closest pure-play on potential growth in US corn acres tied to corn use for ethanol production. CF is the second largest nitrogen producer in North America with 3.6m tons of ammonia and 2.5m tons of urea capacity. CF is the #3 producer of phosphate fertilizer in North America based on 1m tons of phosphoric acid capacity in Florida. CF Industries is a leading US producer and distributor of nitrogen (75% of sales) and phosphate (25% of sales) fertilizers. The company has a 23% share of the total US nitrogen market and a 12% share of US phosphates.

Phosphate prices are strong due to low stocks, new demand for corn (from ethanol), that has created the largest corn crop since 1944 and significantly in creased acreage and fertilizer application rates. The phosphate market will remain tight next year based on healthy offshore demand growth in India and Brazil and higher application rates in the US. This is likely to lead to higher price and cash margins for various fertilizers. The Phosphate producers have better producer discipline and price leadership by Mosaic under a new team, no new mines until 2011 and offshore demand growth in India, Brazil and Australia.

     BEAR POINTS

Natural gas is the principal raw material, as well as the primary fuel source, used in the ammonia production process. Natural gas purchases accounted for approximately 54% of the total cost of sales for nitrogen fertilizers and a substantially higher percentage of cash production costs. The market price for natural gas in North America is significantly higher than the price of natural gas in other major fertilizer-producing regions. For example, during 2006, natural gas prices in the United States averaged approximately $6.74 per MMBtu and in Canada averaged approximately $5.76 per MMBtu. In comparison, during 2006, natural gas prices paid by fertilizer producers are estimated to have been approximately $1.25 per MMBtu in Russia and approximately $2.65 per MMBtu in the Republic of Trinidad and Tobago. A $1.00 per MMBtu change in the price of natural gas would change the cost to produce a ton of ammonia by approximately $33.

Customer concentration is high, as well. Three customers, Agriliance, GROWMARK, Inc., and ConAgra International Fertilizer Company made combined fertilizer purchases of approximately $944.0 million, representing approximately 48% of total net sales.




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