Nufarm Announces Global Market Update
18 July 2011 Nufarm has been having mixed success over the past few months, with regional operations varying from positive to difficult, according to a report released by the company.
The company expects July sales to significantly impact full year earnings. Unfavorable weather in many parts of the world threaten Nufarm’s business, as with many crop protection businesses at this time.
Nufarm’s sales of glyphosate to the end of June are well down on previous years, according to Nufarm. Competitive pricing and lower margins in the glyphosate segment in most global markets has caused the company to focus its business to other segments and diversify its portfolio of products, especially in the US and Brazil.
Most Australian agricultural regions are enjoying above average seasonal conditions and planting activity is strong. Good summer and autumn rainfall in the eastern and southern states has provided excellent cropping conditions and this has helped drive positive demand for a range of inputs, including crop protection products, according to Nufarm.
Pre-plant herbicide usage has been minimal in the west, but further rains are likely to generate a need for strong post-emergent herbicide applications in coming months, according to the company.
Cool weather, heavy rainfall and flooding affected Nufarm’s sales in North America from March to May, but recovered in June. Because of delayed planting of many crops, the company has seen a decline in sales.
There is evidence of continued improvement in credit conditions and farmer terms of trade in Brazil. The outlook for the next major cropping season is also positive and this is generating strong early demand for crop protection products, some of which Nufarm will supply in the June and July period, according to Nufarm.
Recent rains have allowed increased cropping activity in Europe, unusually dry conditions through to June led to a reduction in demand for crop protection products utilized for both European winter crops and delayed spring crop plantings. A number of Nufarm’s European businesses, in particular France, have been adversely impacted by weather, according to the company.
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