Fertilizers, grains demand to exceed supply well beyond 2023 - Barclays

Icl

01/06/2022 13:52

** Barclays begins coverage of fertilizer and grain stocks, 
saying even though the sector has outperformed against major
indices, it expects low supply and high demand for agricultural
products well beyond 2023
       Company           Rating      PT
 CF Industries         Equal        $103
 Holdings Inc   CF.N   Weight       
 Corteva Inc  CTVA.N   Overweight   $71 
 ICL Group  ICL.N      Neutral      $12 
 Mosaic Co  MOS.N      Underweight  $59 
 Nutrien Ltd  NTR.N    Overweight   $116
    ** Brokerage says CF is in a position to deliver outsized
shareholder returns in 2022 and 2023, but current share price
reflects strength
    ** Adds seeds company CTVA is the only company of the five
that Barclays forecasts will have a higher 2023 EPS vs 2022,
given co's lower exposure to volatile commodities
    ** ICL has benefited disproportionately from current
fertilizer market disruptions, and though brokerage sees some
normalization in 2023, it still expects elevated returns
    ** Barclays expects MOS to deliver strong results in 2022
and 2023, but high input cost including exposure to unhedged
ammonia prices remains a challenge 
    ** Brokerage says NTR differentiates itself through an
extensive client relationship management allowing for better
adaptation
    ** Adds NTR could also benefit from its capacity expansion
potential

    

 (Reporting by Ruhi Soni in Bengaluru)
 ((Ruhi.Soni@thomsonreuters.com
Twitter: https://twitter.com/ruhithere))