Mosaic Cuts Brazil Phosphate Output on Global Sulfur Shortage
US fertilizer giant Mosaic has announced temporary production cuts and plant shutdowns across its Brazilian operations due to a global sulfur shortage.
US fertilizer giant Mosaic has announced temporary production cuts and plant shutdowns across its Brazilian operations, citing a severe global shortage and soaring costs of sulfur. The company will extend its ongoing shutdowns of phosphate rock production at its 2.2-million-metric-ton-per-year Tapira unit. Additionally, Mosaic plans to place its 1-million-metric-ton-per-year Uberaba complex on care and maintenance starting in September, alongside halting operations at several regional mixing units, including Candeias and Catalão.
The operational pullback is a direct consequence of escalating geopolitical tensions in the Middle East, which have largely halted maritime traffic through the critical Strait of Hormuz. Sulfur, a crucial byproduct of oil refining used to produce the sulfuric acid required for phosphate fertilizers, has seen its price surge nearly 140% since the onset of the conflict, trading above $1,200 per ton. Mosaic stated that these measures are temporary responses to extraordinary market conditions, but the duration of the shutdowns remains highly uncertain.
For investors in Brazilian agribusiness, these domestic supply disruptions threaten to drive up local input costs during the upcoming planting seasons. Mid- and small-cap agricultural players, including farm operators BrasilAgro (AGRO3) and SLC Agrícola (SLCE3), are highly sensitive to fertilizer affordability and supply chain bottlenecks. Meanwhile, infrastructure and logistics operators like Alupar (ALUP11) are closely monitoring the broader industrial impact of these chemical and mining halts.
On the financial markets, the broader Brazilian market showed cautious trading. The benchmark Ibovespa index (IBOV) slipped 0.79% to close at 170,653.45. Among major Brazilian equities, state-run oil firm Petrobras (PETR4) gained 3.15% to trade at R$39.65, while mining giant Vale (VALE3) fell 4.59% to R$72.70. Financial heavyweight Itaú Unibanco (ITUB4) also declined, down 1.27% at R$41.89.