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Fertilizer makers show record profitability

Leading fertilizer producers achieved record profits and profit margins in 2005.

A study of the world's 60 leading fertilizer producers published by Integer Research has revealed they have combined fertilizer revenues of $43 billion (U.S.) in 2004, and more than $50 billion in 2005.

"This 16% increase is partly due to higher fertilizer sales prices, combined with increased global fertilizer consumption," says Integer director Oliver Hatfield. "This shows that despite the high gas prices, which have affected overall production costs, there are still significant profits and increasing revenues."

The majority of fertilizer revenues are concentrated amongst the top 20 companies. They have combined fertilizer revenues of $35.8 billion, compared to the $14.6 billion for the remaining 40 companies. This constitutes just over 70% of total fertilizer revenues for the top 60 companies.

"Based on fertilizer revenues, Yara is still the biggest fertilizer company in the world, and it continues to expand its business with significant developments in Brazil and China," says Integer analyst Nora Gombos. "The five largest companies are still based in North America and West Europe. However, the other companies in the top ten have changed in the last few years. Eurochem of Russia has risen through the rankings into the top ten, moving Terra Industries into 11th position. This means that in the top ten, the number of companies based outside the established developed regions increased from three to four.

"This is a trend that may continue, with nitrogen producers from Russia, Ukraine and the Middle East taking advantage of the high fertilizer prices, and relatively low gas costs. China is becoming more influential in the global fertilizer market," Gombos says.

Leading fertilizer producers achieved record profits and profit margins in 2005.

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