Yara’s EBITDA dropped almost 5 times in 2Q2023

EBITDA of Yara International in 2Q2023 was $252 million compared to $1.475 billion a year earlier. Net income attributable to shareholders of the parent company was -300 million USD (-1.18 USD per share) compared to 664 million USD (2.61 USD per share) in the second quarter of 2022.

“The second quarter results were affected by the downward price trend we have seen so far in 2023, pushing the industry into a low-margin environment. However, recent price developments point to higher demand going forward,” said Svein Tore Holseter, Yara President.

The European nitrogen industry saw a recovery in volumes in the second quarter, with deliveries since the beginner of 2023 flat on a year earlier. Given the oversupply compared to last season, this indicates an increase in application rates this season. In the new season, recent price developments point to an increase in demand and a shrinking carbamide market going forward, despite significant recent capacity increases. Together with healthy incentives for farmers and low producer stocks in Europe, this creates a positive backdrop for nitrate markets. Based on recent phosphate and potash price developments, margins are likely to recover in the third quarter.

“Yara’s flexible business model has proven to be resilient due to high price volatility and the transformation of raw material sources. I am grateful to the entire team of the company for continuing to cope with this situation, as well as for the implementation of our strategic priorities. With a strong market position and resilience, Yara is uniquely positioned to profitably decarbonize fertilizer production through an attractive investment in blue ammonia in the USA, which will also serve new clean ammonia segments such as transportation fuels,” said Svein Tore Holseter.

Yara continues to lead the energy transition and is expanding its portfolio of ammonia treatment projects. Pure ammonia in the USA represents a significant opportunity for profitable decarbonization and potential for wider adoption in new segments including shipping, power generation and as an energy carrier. At the Capital Market Day on June 26, Yara outlined its goals to develop two full-scale blue ammonia projects in the United States. In addition to the announced project with Enbridge, the joint evaluation of the low-carbon blue ammonia project with BASF represents a second project candidate.