Mosaic swings to loss in Q3 2026 on phosphate cost challenges

Mosaic swung into a net loss for the third quarter of 2026 on the back of lower sales volumes in all segments and the persistence of high phosphate costs, the company said 3 November.

Despite efforts to mitigate extremely high costs, Mosaic posted a net loss of $72 million in Q3 compared with net income of $411 million in the same three months of 2025. During the first nine months of 2026, the company saw a net loss of $600 million compared with earnings of $1.1 billion in the same period last year.

Cost control measures saw the producer lower its phosphate fertilizer operating rates in both the US and Brazil, with output aligned to the availability of affordable feedstock sulphur.

Mosaic’s potash business remained profitable in Q3, though earnings declined, with some production issues at the Esterhazy mine in Saskatchewan pushing the producer to lower its full-year guidance.

In its phosphate segment, Mosaic’s Q3 net sales were largely flat yr-on-yr at $1.30 billion, but an operating loss of $194 million was recorded, down from an income of $102 million in the same period last year.

EBITDA in the phosphate segment for Q3 was $49 million compared with $280 million in the prior year period as higher raw material costs and lower sales volumes were only slightly offset by higher realised prices.

Phosphate sales volumes reached 1.4m. tonnes in Q3, flat on Q2 but down from 1.6m. tonnes in Q3 2025. This primarily reflected production curtailments due to a lack of affordable sulphur, Mosaic said.

The company’s phosphate production in Q3 was 1.3m. tonnes, marking a 24% decline from 1.7m. tonnes in the same period last year and a drop in operating rates to 52% from 68%.

Mosaic recently settled its Q4 sulphur contract price with US Gulf Coast refiners at $615pt cfr, down $90pt from Q2 and reflecting a discount of roughly $200pt below global average import prices.

However, the sulphur decline will not noticeably benefit earnings until Q1 2027 given that there is a two-to-three-month inventory cycle lag. Mosaic’s cash flow should start to improve in Q4 prior to translating into improved earnings thereafter.

Mosaic’s average ammonia cost was $619pt in Q3, but the company’s November Tampa price rose $95pt to $640pt cfr last week, offsetting much of the recent production cost saving from sulphur.

The idling of Louisiana phosphate fertilizer production contributed to an idle, turnaround and unabsorbed fix cost of $77 million for Mosaic in Q3, up from $42 million in the same period last year. This cost is expected by the company to rise further in Q4 following additional curtailments at South Fort Meade as well as at its Miski Mayo phosphate rock mine in Peru.

Mosaic reported an average DAP sales price of $838pt fob mine for Q3, up from $714pt fob in the same period last year and from $773pt fob in Q2 2026.

For Q4, the producer is expecting phosphate segment sales volumes to reach 1.3-1.6m. tonnes, with realised DAP prices forecast to average $820-840pt.

In the potash segment, Mosaic reported net sales of $643 million in Q3, marking a 7.5% decline from $695 million in the same period last year. The decrease was seen as sales volumes dipped year-on-year to 2.1m. tonnes from 2.3m. tonnes.

Mosaic produced 2.1m. tonnes MOP in Q3, also down from 2.3m. tonnes in the same three months of 2025 on the back of routine turnarounds at the Colonsay and Belle Plaine mines. However, output was also impacted by lower-than-expected ore grades at Esterhazy, which are expected to be temporary.

Nevertheless, Mosaic has now lowered its full-year 2026 potash production guidance to 8.6m. tonnes from 9.0m. tonnes previously due to the challenges at Esterhazy, which underwent a routine turnaround in Q2. The company had been expecting its 2026 potash production to be weighted towards H2 due to a ramp-up at Esterhazy’s Hydrofloat project.

On 3 November, a “seismic event” occurred in a mined-out area of the Esterhazy K3 mine, Mosaic said. Operations were reportedly maintained and all employees were accounted for. Earthquakes Canada recorded the earthquake as “mining-induced” with a magnitude of 3.5.

Esterhazy is currently the world’s largest single potash mine with a nameplate capacity of 7.8m. tonnes/year, according to Mosaic.

Mosaic is still targeting annual MOP production of more than 9m. tonnes over the medium-to-long term, including around 5m. tonnes at Esterhazy from 2027, the company said in the Q3 results release.

Sales volumes in Q4 are expected to reach 2.3-2.6m. tonnes and realised mine-gate prices are expected to range from $255pt to $275pt. Mosaic saw an average MOP sales price of $276pt fob mine for Q3.

Mosaic’s average cash cost of MOP production was $73pt in Q3, up from $71pt in the same three months last year but down from $84pt in Q2 2026. Higher operating rates at the lower-cost Esterhazy and Colonsay mines contributed to better fixed cost absorption. The Q3 costs were the lowest seen so far in 2026.

Mosaic’s Q4 North American sales volumes are now fully committed, and the company is forecasting that global potash shipments in 2026 could surpass 75m. tonnes to reach a new record high on the back of healthy affordability.

Mosaic Fertilizantes in Brazil posted net sales of $1.3 billion in Q3, down from $1.6 billion in the prior year period. The segment recorded an operating loss of $21 million compared with income of $96 million previously.

Sales volumes from Mosaic Fertilizantes reached 1.9m. tonnes in Q3 compared with 2.8m. tonnes in the same period last year with the decline attributed to production curtailments and credit contraints for buyers.

The decline in production rates in Brazil pushed Q3 unit cash conversion costs to $147 million from $99 million in Q3 2025.

Mosaic progressed with plans to divest its Araxa phosphates facility in Brazil during the latest reporting period, though no further details were provided by the company in the earnings report.