Mosaic Q2 2024 Earnings Call Transcript

Thanks, Bruce. Before we move on to the live Q&A, as we've done in past quarters, we'd like to address some of the most common questions received after publishing our earnings last night.

Our first question is related to the markets. What is your view on the demand outlook for fertilizers given the recent weakness in corn and soybean prices?

That's a great question. So let me start first with the ag commodity market, which is very constructive with global grain and oilseeds stock-to-use ratio still well below historical average. While no doubt corn and soybean prices have softened other grain and oilseeds and specialty crops are favorable, especially for crops like palm oil and rice. And I want to remind investors, as we've said in the last couple of earnings calls, that only one third of phosphate and potash consumption is related to corn and soybeans. And the demand pool from the remaining crops continues to support constructive fertilizer fundamentals. On a higher level, phosphate demand is strong across all the key markets we sell in. For potash, demand has definitely come back significantly, particularly in Southeast Asia, given the favorable weather conditions, pent-up demand for multiyear under application and the current attractive prices. The recent settlements of the China and India seaborne contracts are going to further stimulate demand all over Asia.

With that, I'm going to pass it over to Jenny to talk a little more details about the near term demand.

Thanks, Bruce. There's no doubt that growers in the US and Brazil are watching the future corn, soybean prices. Along with any news that about weather development, which might impact the yield projection at these prices. In terms of the near-term demand, in North America we had a very strong summer fill program. In fact, we have sold out all of our Q3 available phosphate and 80% of our available potash tonnes [Phonetic] in North America market. In Brazil, [Indecipherable] season is in full swing. The demand is robust. We expect 2024 shipment is going to be at the record or going to set a new record. We are having a very full sales book to execute. We have sold 100% of our available transfer Q3 with a very strong customer pre-payment. In India, with favorable monsoon, growers need their fertilizers to maximize their production of rice, wheat and other crops [Indecipherable] in order to get more DAP into the country. In China, we have seen very strong domestic shipment for both phosphate and potash in the first half of the year. We are seeing 20% growth year-over-year, supported by very strong ag fundamentals and supported by their policies to ensure food security.

Thanks, Bruce and Jenny. For next question. What is the latest on phosphate exports out of China? And how do you see that evolving over the rest of the year?

Well, this is something we pay attention to a lot. We anticipate limited exports of phosphate out of China, which bodes well for global phosphate prices. First half exports were approximately 1 million tonnes below the same time in 2023, due to strong in-country demand for both fertilizers and industrial uses. China's domestic prices continue to move up, considering that demand, and we believe the export restrictions will likely remain or potentially even be tightened to limit further domestic price escalation. With that, I'm going to ask Jenny and pass it over to her to share some additional details.

Thanks, Bruce. As Bruce mentioned, the first half export in China reduced by 27% or over 1 million tonnes. That is a result of the changes in Chinese local S&D for phosphate. On the demand side, Chinese phosphate domestic shipment increased over 20% in the first half of the year, which is probably the record. They're driven by several factors. First, strong ag fundamentals supported by ag policies to ensure food security. Second, meaningful growth of vegetable and food planting acreage over the last five years. Third, the introduction of high-tech seed technologies have required more balanced fertilizer to maximize the yield. And lastly, we also recognize there are some earlier seasonal pool for the full demand. As a result of it, the demand of Chinese phosphate domestic shipment has increased significantly in the first half of the year.

And then let's look at the supply side. Continued shift from fertilizer production to industrial products like PPA, LFP, has reduced availability of fertilizers, especially DAP. The production of LFP in the first half of the year has reached to over 1.1 million tonnes, which is an increase of 82% year-over-year and that represents over 90% compound annual growth rate from 2022 [Phonetic] to 2023. So in the first half of 2024, over 1 million tonnes of DAP products are shifted to LFP. So the growth of domestic demand, the reduction of production plus rising prices have had Chinese government tightly controlled the export phosphate out of China. We expect the restrictions is going to continue in the second half and going forward.

Sticking with Phosphates for our next question, how is the production ramp-up going? And how do you see the rest of the year playing out from a volume and cost perspective?

We are making significant progress in our phosphate production ramp up. And as a result, we're seeing good fixed cost absorption benefits, especially in the past two months. You can see the progress in our second quarter production volume and unit conversion costs. Our volumes were up close to 100,000 tons sequentially, which is a significant achievement. And our cash conversion costs were the lowest since the end of 2023. We have certain sites, for example, Bartow and New Wales, which are performing particularly well and are contributing at the rates required for the business to return for our historical production objectives. We'll undertake several maintenance turnarounds in Louisiana and Riverview to further improve our production run rate in the second half of the year. Note, we will always see some variations from quarter-to-quarter due to the normal turnaround schedule, the scope of those turnarounds and the decisions we make on finished product mix from the phosphoric acid we produce. So we expect annual production to be in the range of 7.8 million tonnes to 8.2 million tonnes once we get back into a normal routine on turnaround activities. Unit costs are expected to demonstrate continued improvement as we increase production and we're on track to achieve $20 per tonne to $30 per tonne in cost reduction from higher operating efficiency.

Now switching over to Potash. What's the thought process on restarting Colonsay?

Well, thanks for that question. I know it's on a lot of people's minds. But for Mosaic, and we've been consistent with this, Colonsay is an important component of our potash portfolio. It gives us the flexibility to meet our operating objectives. One objective is to ensure we meet market demand. Now that the settlements of the China and India potash contracts are behind us and a price floor is established, our focus is to produce enough product to meet customer commitments. We have maintenance activities and turnaround scheduled for our assets every year. And in fact, Esterhazy is scheduled for one in the third quarter of this year. In order to have enough product on hand to meet our commitments with Canpotex, which we just mentioned was sold out for the third quarter, we must restart Colonsay. And just as a reminder, it takes approximately five months of Colonsay operating to replace approximately one month of Esterhazy production.

Our next question is related to Brazil. The market has been challenging for several quarters in a row within your industry. What is the latest situation from your perspective?

The operating environment in Brazil agriculture has been challenging for the past year. And it has taken a toll on many participants in the market. I will highlight that our deep expertise and strong brand in Brazil market with over two decades of distribution experience has allowed us to mitigate the market related risks and deliver strong results. Our assets, which include in-country production, sports, warehouses and blending facilities provide us with the required scale, geographic diversification and cost efficiency to succeed in this geography. Our strengths have allowed us to gain further advantage as others have exited the market or reduced their footprint in country. Retailers and large growers have turned to us for reliable supply, and we are here to meet that demand.

Thanks, Bruce. For the next question, you previously announced targets related to cost savings and capex reductions. Are you on track to meet those targets?

We've made significant progress on our cost and capex initiatives. There are three categories the first, operating efficiency. In Phosphate, higher production volumes have significantly improved our fixed cost absorption. We had very good results in the past two months, as I previously mentioned. And as you can see, our cash conversion costs have decreased 15% from the high point in the end of last year. We do expect further improvement in the remainder of the year as production volume continues to recover. Operating efficiency is not just in the phosphate segment, however, costs came down in the potash and Mosaic Fertilizantes segments as well. Our unit cash cost of mined rock, phosphate conversion and potash production declined across all three segments since the same time last year.

Second, our cost focus is not exclusively on operations. We have a focus on reducing costs in all areas of the company. As mentioned last quarter, we have had plans to reduce headcount, mostly third-party contractors. I'm pleased to announce we have implemented the first phase of that reduction. We will start reaping the benefits in the second half of 2024. The full program will be completed by mid 2025 and result in run rate savings of approximately $20 million to $30 million. Our other cost controls in Brazil and SG&A reduction are also on track. Since the inception of the initiatives, we have achieved about $50 million in run rate cost reductions, about one-third of the total $150 million target.

Finally, on the capex front. We finished several growth projects in the past six months. As these projects continue to wind down, we are on track to reduce capex by $200 million this year.

Thanks, Bruce. With that, we'll now move on to the open question-and-answer session. Operator, please open the line for follow-up questions.

Well, thanks, Ben. I'll take the first part of your question and then maybe pass it over to Jenny for any commentary on the LFP. But we agree -- I mean phosphate prices look very constructive for the near term. And as far as what is out there to change something, we don't see a lot of new capacity come on, which historically is -- or announced in the near term, which historically has been something that could influence kind of outlook on price and the fact that that's not there of significance. We're very optimistic about how prices are going to play out. If you look at our stripping margins well over $400. We kind of continue to see that in the back half of the year and that kind of mid-$400 range. No doubt, there's affordability issues, but if you look at total crop affordability, I think Jenny talked about that earlier in the fireside chat, it is still very constructive, although no doubt pressures on certain areas on corn and soybeans as an example, but again, 30%, 33% of overall P&K demand is in corn and soybeans and then the other 67% is in other grain and oilseeds, which quite honestly is very constructive and healthy. For example, palm oil, sugarcane, coffee, other things like that, but I don't see right now a big catalyst to change that in the for coming future. But you never know what could come out geopolitically or something like that, but I think that's what it would take. With that, I'll turn it over to Jenny to maybe answer the LFP part or Jenny, if you've got anything else to add on the market itself.

Sure. Thanks, Bruce. Ben, probably to your question on LFP, I just want to remind ourselves at this point of time, LFP is mainly used in China and mainly used both for Chinese producers and also for Tesla. So the LFP have been used as a battery for EV, adoption in Chinese production was already up to 69%, meaning 69% of the EV batteries are using LFP. Longer-term projection -- there are very big range of protection on LFP growth globally. We believe going forward, the global EV battery adoption for LFP is going to be somewhere between 35% to 55%. We don't believe it is going to ever reach to the level as it was in China today. The other bigger driver on LFP adoption is really on the storage -- energy storage ESS stationary -- battery. And the adoption of that part on LFP is already over 80% and that battery being produced in China mainly and shipped to rest of the world and by Tesla as well. And we believe that is going to be the major driver for LFP going forward. So very wide range. And if you use China as a proxy for EV, the future growth from rest of the world is going to continue. And lastly, people don't pay a lot of attention on the storage stationary battery, which is probably going to be a bigger driver. Thanks.

Yeah, no, thanks, Vincent. For phosphate, our projections in the range of 73 million tonnes to 76 million tonnes global shipments. For potash, that range is 70 million tonnes to 73 million tonnes. I think -- and Jenny, correct me if I'm wrong, our Potash numbers have kind of have gone up a little bit, that midpoint around a million tonnes based on what we're seeing develop in Southeast Asia and really all Asian markets in general, given where these contracts have settled in China and India and kind of the sentiment that, that's provided confidence in the industry that kind of the bottom set in on potash. On phosphate, I don't think that range has changed very much for us, since the beginning of the year, just given that supply is limited, Vincent.

Yeah, there's -- as we've said before, there's always a lot going on in that space. I know it's hard to track, but ITC still has appeals and rulings that they owe the industry and the Department of Commerce several months ago came out with their preliminary rate adjustments for last year 2023. And those went up for OCP like 12%. They went down for phosagro, about 10% and stayed the same for EuroChem, but again, those are preliminary. The final numbers will come out in November. So we'll wait and see what happens between now and then.

Hey, thanks, Joel. I'll start just at the high level and maybe Jenny can get into some of the details on seasonality. But we're pretty pleased overall with the performance of Mosaic Fertilizantes. And I know in this space, there's a lot of other players are not having as good news and success for us, that could be an opportunity. But we do see margins staying pretty steady in that $30 to $40 range for our distribution volumes and don't see that really changing much. On the volume side, overall, in Brazil, still see very good overall volumes and total fertilizer demand for the year. Maybe there's some risk at the end of the year due to some things, but still see, and Jenny can get into that, still see at or near historical fertilizer shipments in that market for the full year. Jenny?

Sure, Bruce. Probably just want to provide a little bit color on the seasonality and where we see the market as of today. The [Indecipherable] season, it's in full swing. We are seeing very strong demand and which is basically the ongoing Q3 is the delivery for the [Indecipherable] season. The farm economics were very solid, and the farmers are selling their own crops. On soybean are actually ahead of last year and at five years average, though they're selling of the corn a little bit slower than five years average, but they're same as of last year. So farmers are really keeping pace on selling their crops which are really improving the liquidity in the system. And specifically for fertilizer, they call commercialization. If we assume the full year is going to set a new record for the shipment of the year, 82% of the fertilizers for the full year has been sold. This number is slightly lower than last year. For Mosaic, we are tracking the same pace as of last year. So we are selling ahead of the market trend for the season. And even with that, we are focusing on value, the volume and we're really prioritizing our sales and shipments to the customers who have a much lower credit risk.

Lastly, there are some potential shift for the Q4 sales, which is a safrina season for corn and cotton. And there might be shift from November, December sales into January, that is going to define what is going to be the final shipment in Brazil going to be. The farmers are relatively more cautious for that season -- of seasonal buying. As of today, we have seen 30% of the buying for safrina and versus in the mid-30s in the previous year. So it's relatively slower. There might be some of the demand shifting from late Q4 into early Q1. So that's basically the situation. We have sold every single our Q3. We're in full execution mode.

Yeah, Joel, thanks for the additional questions. But the safety incident we had a serious incident at New Wales recently, actually was a fatality. And did -- not that it matters, but did get headline news and just wanted to be very transparent about that. It's something that is worse outcomes for us as industrial operators. And as we said, take that very seriously and lessons learned and shared across the entire geography with that. But we feel for the families and those impacted by any incidents that we have of seriousness within Mosaic.

On the phosphate ramp-up and return to production, as you saw quarter one to quarter two, definitely demonstrating results. I think one of the slides we have on our earnings material in the presentation kind of hopefully shows a little more color on how we're progressing. As we said, Bartow and New Wales have shown good signs due to the investments that we've made there and finally catching up on the turnarounds, even going back to COVID, as we've talked about in several calls before. Louisiana is also ramping up, had a decent quarter, but still more to go as we've got some more work to do there in the back half of the year. And then Riverview with the brush fire that we've talked about before and then the conversion of the one large granulation plant over to MicroEssentials and ramping that production up as kind of hurt that operating rate in quarter two, but still more work to do in the second half of the year that we have planned, but definitely optimistic that in aggregate with the work that we have teed up and the demonstration that we've seen at New Wales and Bartow that we're well on our way to kind of hitting that historical run rate that we've talked about, and confident that we'll get there Joel.

Yeah, Steve, that's a pretty complicated question. I mean maybe it's just easier to back up on how we see the overall potash market. I mean first on supply. Although, yes, you're right, sanctions exist on products, particularly in the FSU, in Belarus, particularly. But we're seeing trade flows have just been shifted around. They're getting their product out. There's been a large rebound both in Russia and Belarus, this year versus last year, but it's been progressing over the last couple of years. So those tonnes are available. They're just hitting the geographies given the restrictions that they have, markets that they can participate in, they're just taking larger share in closer to home markets. Think about Belarus is doing it with rail into China, but it's coming at a cost to serve for them, which is probably raising the umbrella on how little potash prices could ultimately go by $40 to $50 versus historical numbers, just given the type of logistics gymnastics they have to do to get into the markets that are available to them. But there are several buyers. If you want to look at it that way, geographies that the sanctions don't really matter. Brazil is going to buy from whoever they need to because they're a large importer.

And so again, it is simply just moved the trade flows around. And I think the supply side is much return to where it was kind of before the sanctions. And then we're seeing demand as that supply has come back, return as well, Steve. So this year, at 70 million tonnes to 73 million tonnes outlook, it's going to be at or near record. So I think the nutrients are going down as the supply becomes more and more available. And then obviously, long term, unlike phosphates, in potash there are significantly announced expansions and greenfield mines coming on. And as growth in demand happens, pick your number, 2% to 3% compound annual growth rate, that demand is going to be needed, but it's probably going to keep prices in a more constrained zone than what you may see in for instance, phosphates. Jenny, I don't know if you have anything to add. She's saying no, Steve. So I guess I got that one.

Yeah, Steve, thanks. First off, we're excited about biologics. And we see a lot of synergies with our distribution network, our customer relationships, the brand that we have, at least what we believe that we have in the marketplace, we're bringing higher-performing products with real science and data back to results to the market. And we think they're very complementary to what we're currently selling, and I'm going to let Jenny get into a lot more of the details of that and unpack that a little bit more. But we see meaningful growth potential for these. And we think we have good products already in the market that are delivering significant yield results without impact to overall fertilizer application. In fact, the two combined so one plus one equals more than two in this regard, from a yield standpoint and really helps the story of how to help farmers or growers get more out of the same amount of acres of land. But Jenny's team has been doing a lot of work to develop launch programs in various geographies that we talked about in some of our prerecorded comments. So I'll turn it over to Jenny to talk a little bit more about mechanisms, delivery and any other salient points there.

Sure, Bruce. Hi, Steve, in terms of the go-to-market for our bioscience products, firstly, as you can imagine, we go through our current customer base and the current market access, basically, the products are coated with the fertilizer [Indecipherable] fertilizer granulars. So that is one of the major go-to-market approach for our product. One of the major leading brands that currently we're selling in Americas. North America and Central America, PowerCoat, are basically coated on the fertilizer granulars. We also have a current brand pass are sold as a standalone full year application. So that usually can be mixed with fungicide and insecticide. So when the farmers are treating their crops. As you well know that we have invested in the next-generation nitrogen fixation product, that product is likely going to go with seed coating, as the go-to-market approach, which is going to give the highest efficiency and the lowest cost. And we're working with several major seed companies on that front. And hopefully, we can provide more updates in the near future. Thanks.

Richard, thanks. We do have -- as you know, the scheduled turnaround, as you mentioned at Esterhazy, right now, it's roughly a month, and that will be plus or minus few days based on discoverables as they get into pieces of equipment and things like that as always. But as we talked about, based on the capacity comparison, you have to run Colonsay about five months to offset one month of Esterhazy production. So Colonsay likely is going to run much of the remainder of the year to provide that volume offset exactly as you said. Colonsay, as we've demonstrated before and as we talked about, is our flexible tonnage to do exactly that, to look at what the market needs overall and make sure that we can meet our commitments and then to serve as backup for instances like this where we need to make sure a product is in our warehouses and position to meet international demand or domestic demand in those times where we do maintenance turnaround.

From a cost standpoint, we prefer to run always, [Indecipherable] and Esterhazy first as those are our two low-cost -- solidly low-cost producers here in North America. Colonsay is higher in cost. So there's likely going to be some cost effect on production cost during the times that that's running. But, we've made significant improvements over time in Colonsay and stripped costs there. So the incremental cost is not going to be that significant from an overall unit cost standpoint. So I'll leave it there, Richard, and move on to the next question, given time.

Thanks for the question. Let me -- maybe answer it a little bit -- well, differently, we -- actually, our realized stripping margins are higher than benchmark stripping margins. And that's something that probably don't have a lot of insight as we don't report on that. But because of exactly what you just said is our ammonia cost advantages with our long-term CF contract as well as up to a third internal production at Faustina at producer economics. And then just our buying power for sulfur and even ammonia that's left on spot, it gives us a pretty good advantage given the geography where we import those raw materials as well. So it did go up on ammonia cost, as you said, Adam, in Q2, and that's really because in Q1, our ammonia plant was down for turnaround for much of quarter one, where we did have more spot going into inventory. And that's just actually that raw material ammonia flowing through inventory from quarter one into quarter two. So the benefits of running more in quarter two, you'll start to see those in quarter three. So I hope that answers the bulk of your question in a little different way.

Yeah, I mean I agree, Chris, and thanks for the question, that market fundamentals, as we talked about, appear to be strong and just don't see anything out there that's going to be a big derailer. But to your point, why are we not getting maybe more credit given how much we're leveraged into phosphates. I think it is on execution and delivering those results. Yes, we're making progress, and I appreciate the commentary because we feel good about how we're executing on our strategy. But we do still have a lot to go in the back half of the year and to see that kind of 8 million tonnes, 7.8 million tonnes to 8.2 million tonnes run rate. Going into 2025, we still got to deliver upon that. So -- and with that, as you well know, comes significant cost absorption and those cost absorption numbers aren't even in our cost savings as of right now, and we'll reconcile that and report on that on an annualized basis because it is just too much noise from quarter-to-quarter. So I think it is execution.

I think the other thing is -- and maybe, Jenny, if you've got any comments here, but is that people just think China is going to open up some magic floodgate on export. And we just don't see it that way. Based on the intelligence and the people we have in country, as Jenny has talked about, we're seeing very good demand domestically in China on phosphate for agriculture, given their focus on food security and then you can't ignore the fact that LFP on the industrial side is making significant growth and is somewhat cannibalizing other available agricultural P205. So again, I don't know what it's going to take for people to believe in that, but I think this year demonstrates just how that policy in China is impactful. OCP may be exporting a little bit more, but the fact that China is exporting that much less kind of neutralizes that. So we just see very constructive fundamentals in phosphates. Maybe people just got to see it for a little bit longer. And no doubt, we got to demonstrate on what we've said we can execute and control.

I'll start maybe at a high level and Jenny, I'll turn it over to fill in a little bit more details. But we're very optimistic about the second half of the year in Fertilizantes -- just at a high level, again, just to reiterate kind of how we see this business is 9 million tonnes distribution historically growing to 10 million tonnes from a volume standpoint. $30 to $40 distribution margin, about $100 million of EBITDA contribution on co-products on an annualized basis. And maybe something we haven't talked about publicly, but as much -- it's available in our information, but I think it's worth highlighting is that there's another $100 million thereabouts of SG&A costs that kind of -- you got to take off the top. So throw all that together, you can do the math on what you think volumes are going to be quarter-by-quarter based on historical performance or whatever you do. But given the demand in Brazil, we see good returns and EBITDA contribution out of Fertilizantes in the second half of the year. Jenny?

Yeah, I guess your question specifically on Q4. I just want to say for Q3, repeat, we have solid sales book, that we're executing upon. The volume is historically -- as historically, Q3 is the highest quarter, and the gross margin per tonne is at the $30 to $40 range. For Q4, depending on how the market is going to move from second half of Q4 into first half of Q1, there might be some shift on the volumes. And also want to remind Q4 is the safrina season, where nitrogen has a much higher percentage in the total market, which we participate a little bit less than the [Indecipherable] season. So that's a reminder. Thanks.

Thanks, Jenny. The only other thing maybe to think about is FX tailwinds. I mean with the FX movement over the last month, several weeks, there's definitely providing some tailwinds to our operating costs that are real-based. So that should help on the margin expansion as well.

Yeah, Edlain, thanks for your question. I don't know that our crystal ball is any better than yours. And I think it just -- and Jenny, please help, but -- you go back to the fundamentals, I just think the supply and demand fundamentals on the global scale are different between those two commodities. And just because they are divergent today doesn't mean they need to converge. It would be my thoughts on this. It's very much going to be those two commodities independently what is going on from a supply and demand standpoint. We know what the crops need. It comes down to supply. Supply has probably got a more announced, as I said earlier, on potash. And what can come to the market over the next decade. In phosphopates, it's just not as clear as what is going to be a catalyst to bring to your point, pricing down. So in the meantime, we're optimistic on P, don't see prices with a lot of risk there in on K. I think the ZIP code of where prices are today is pretty solid for the foreseeable future. There may be some seasonal uptick here and there and from year to year, but I don't see some dramatic change in K moving up or moving down just because they're divergent today. It looks like Jenny doesn't have anything to add.

Yeah, thanks, Lucas. Definitely -- I don't -- definitely see that as volume improves at fixed cost absorption, and there's other benefits like electricity generation that we've talked about rather than buying third-party, will produce more of our own internal power that we generate and reap the benefits there. But overall, kind of from that historical high, we see a $20 to $30 reduction in total cost. Will we get back to that $65, $70 number, listen, the inflation that we've seen overall across the globe in United States, it's no different, and our operations are no different. I don't see getting back to those numbers, but we should definitely see further improvement, maybe another $20 down from where we are right now as we get to that historical run rate.

Yeah, Andrew, I mean we think that having Colonsay as a flexible option for when the market demand is there and it intersects appropriately with shareholder value that it does provide significant optionality to the upside for us. And we've demonstrated our responsibility to try to control that volume that we have based on the commitments that we have both to Canpotex and to our customers in North America where we can. But the fact that we need to run it right now is because you take the big dog out of the equation for a month, and that's a lot of tonnage that we have to make up for. And just given the tightness in the market and the inventory particularly on our side, we don't have inventory built up to be able to buffer that out. So Colonsay needs to come on. How long it will come on? As we always have said and always look at, it is going to come down to what's going on in the marketplace, what do we believe it looks like for the future in that regard, to your point, we'll make our own opinions on that. And does that intersect proper shareholder value at the same time? Right now, we're focused on through the end of the year. Colonsay is probably going to have to run to offset the Esterhazy turnaround, but we will continue, as we always have to monitor the best decisions for Mosaic and our shareholders and our customers and decide what to do with that going forward.

So with that, I think we're done with the call, operator, on the questions. And I'll just conclude that I'd like to reiterate just a couple of key themes. One is Mosaic delivered solid second quarter results and operational performance. We are making steady progress on our strategic initiatives to grow the company, manage costs and maximize returns. Fertilizer demand is robust around the world, and our market outlook remains constructive. And our overall outlook for the remainder of 2024 is positive. So thanks, everyone, for joining our call, and have a great and safe day.