Another rocky quarter for Fertiglobe: UAE-headquartered urea and ammonia exporter and MENA’s largest producer of nitrogen fertilizers Fertiglobe reported USD 41 mn in net profits — a 86% y-o-y decline by our calculations — compared to USD 292 mn in the same quarter last year, according to a disclosure (pdf) to the ADX. The company’s revenues dropped by 60% y-o-y to 525 mn in 3Q 2023.

Fertiglobe is looking forward to a better 4Q: The fertilizer company noted an increase in ammonia and urea prices by 150% and 35%, respectively, after the prices reached their lowest point in late 2Q/early 3Q of this year. The higher prices of nitrogen are driven by tightened market balances due to record low inventory levels, healthy demand from key importing regions, restrictions on Chinese urea exports, and supply disruptions, Fertiglobe CEO Ahmed El Hoshy explained in the statement, adding that he expect the benefits from these increases to materialize in the fourth quarter.

Looking ahead: “Fertiglobe's short-term outlook is further underpinned by a strong order book for ammonia and urea sales at higher prices for the remainder of the year,” El Hoshy said, adding that in the medium to longer term, the nitrogen outlook also “remains favorable, with limited incremental supply additions over the next several years.” The company is continuing to expand its low-carbon ammonia capacity to meet the increasing demand for low-carbon hydrogen and ammonia, pointing to Fertiglobe’s recent partnership with UAE oil giant Adnoc to pilot the world’s first cost-effective modular carbon capture unit, he added.