Agribusiness · Fertilisers
Nitrogen, Phosphate, Potash Explained
The three crop nutrients, how each is made, why N, P and K costs differ, and how Nutrien, CF Industries and Mosaic show integrated versus specialised models.
Selborne Research · Fertilisers coverage: 7 guides, 6 company profiles, a primer and Excel model
Educational analysis for professional use. This guide is not investment advice or a recommendation to buy or sell any security, and it is not personalised.
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Three Nutrients, Three Cost Structures
Nitrogen, phosphate and potash are three businesses, not one commodity. Each is made differently, priced on its own benchmark and driven by a different cost. Separate them first, then map each producer to the nutrients it actually earns from.
Nitrogen: Gas to Ammonia to Crop Nutrients
Nitrogen fertilisers start as natural gas. The Haber-Bosch process turns gas into ammonia (NH₃), which is made into urea, UAN (a solution of urea and ammonium nitrate) and other products. CF Industries says that for many producers worldwide, gas is more than 70% of the variable cost of making ammonia.
North American producers sit at the low-cost end of the nitrogen cost curve, the ranking of plants from cheapest to dearest, because US Henry Hub gas is cheap next to European gas. In FY2025 CF Industries’ gas cost $3.31 per MMBtu (million British thermal units) on 352M MMBtu used, and Nutrien’s nitrogen segment paid $3.53. Yara International, the Norwegian producer, paid a weighted $10.0/MMBtu across its plants and $13.2/MMBtu in Europe, on 226.0M MMBtu ($2,242M), which puts it at the high-cost end. The gas and nitrogen guide builds the cost of a tonne of ammonia.
CF is the cleanest read on nitrogen alone, with no phosphate, potash or retail. In FY2025 it sold 19.06M short tons (2,000 lb each) of product and earned $2,893M of adjusted EBITDA, $152 per short ton. It estimates that a $50 per short ton move in its realised urea price changes adjusted EBITDA by about $800M a year, leaving out its minority partner’s share.
Phosphate: Rock, Ammonia and Sulphur
Phosphate fertilisers such as DAP and MAP (di- and monoammonium phosphate) start with phosphate rock, which is treated with sulphur and ammonia. So a phosphate producer carries gas exposure through its ammonia even when it sells no nitrogen.
Mosaic is the teaching case. In FY2025 its Phosphates segment earned $917M of adjusted EBITDA. It produced 6.3M t of concentrated phosphate crop nutrients and realised $670/t for DAP at the plant. A tonne of DAP took about 1.65 t of rock at $80 a tonne, 0.40 long tons of sulphur at an average $236 and 0.23 t of ammonia at $468, plus $125 of conversion, the plant work that turns these inputs into fertiliser: about $459 in all.
Mosaic makes part of its ammonia at its own Faustina plant and buys the rest, and it has no nitrogen segment. ICL Group sells specialty phosphates to food and industrial customers as well as fertiliser: its Phosphate Solutions segment earned $528M of EBITDA in FY2025, and ICL makes no commodity nitrogen.
Potash: Mines and Freight
Potash, sold as MOP (muriate of potash, or potassium chloride), comes from mines in Saskatchewan, Belarus, Russia and the US, and from evaporation ponds on the Dead Sea in Israel. Some mines are conventional underground mines; solution mines dissolve the potash underground and pump it to the surface. Cost depends on ore grade, mine type, royalties and freight to the import market. The benchmark is granular MOP landed in Brazil (CFR Brazil), which averaged $347.5/t in 2025 (World Bank).
Each producer files a different cost measure:
| Producer | Measure | FY2025 cost | Basis |
|---|---|---|---|
| Nutrien | Controllable cash cost of product manufactured (COPM) | $58/t | Per tonne produced; leaves out depreciation, royalties, gas, carbon taxes |
| Mosaic | Cash cost of production | $75/t | Per tonne produced |
| Intrepid Potash | Cost of goods sold | $328/st (about $362/t) | Per short ton; includes depreciation |
Nutrien produced 13.97M t of potash and realised $252/t net of freight. Mosaic produced 8.8M t. Intrepid Potash realised $353 a short ton, net of freight; its filed potash segment gross margin was $18.2M, or $63 a short ton sold. ICL produced 4.38M t and realised $333/t CIF, delivered to the customer’s port and averaged over every market it ships to.
Why Producers Rarely Span All Three Equally
The upstream assets do not overlap. Nitrogen needs gas supply and ammonia plants, phosphate needs rock reserves and conversion plants, and potash needs mines in particular geologies. Nutrien owns all three plus a retail network that earned $1,736M of EBITDA in FY2025, and even its mix is uneven: phosphate earned $382M of the $6,519M its segments made.
| Company | N | P | K | What it teaches |
|---|---|---|---|---|
| CF Industries | Yes | No | No | Nitrogen only, on US gas |
| Mosaic | No* | Yes | Yes | Rock integration; gas exposure through ammonia |
| Nutrien | Yes | Yes | Yes | All three nutrients plus retail |
| Yara | Yes | Partly** | No | Nitrogen on European gas prices |
| ICL | No | Specialty | Yes | Potash plus specialty phosphate; no commodity nitrogen |
| Intrepid Potash | No | No | Yes | Small US producer of potash and Trio, a potassium, magnesium and sulphur fertiliser; reports per short ton |
*Mosaic uses ammonia to make phosphate but has no nitrogen segment. **Yara mines phosphate rock at Siilinjärvi, Finland, for its compound fertilisers but reports no phosphate segment.
The Three Price Benchmarks
Each benchmark is quoted at its own place:
| Nutrient | Benchmark | 2025 average (World Bank) |
|---|---|---|
| Urea | Middle East export port (FOB), prilled | $422.7/t |
| MOP | Landed in Brazil (CFR), granular | $347.5/t |
| DAP | US Gulf export port (FOB) | $685.2/t |
A company’s realised price is usually measured somewhere else, at the mine, at the plant or delivered, so it will not match the benchmark even in the same year. Valuation runs on long-run prices; the mid-cycle earnings guide sets out the ones the model uses.
Four hypothetical producers, in US nitrogen, European nitrogen, phosphate and potash, valued year by year as nutrient prices recover to mid-cycle, set beside the through-cycle multiple.
- 15 sections, from how a nutrient producer earns to a year-by-year DCF and leverage on mid-cycle EBITDA
- 43 pages
- a US nitrogen producer on Henry Hub gas, a European nitrogen producer, a phosphate producer and a potash miner
- 4 producer engines
- listed nitrogen, phosphate and potash producers on filed FY2025 figures
- 6-company screen
The Excel model is the primer's mid-cycle valuation live across 13 sheets: four producer tabs (US nitrogen on Henry Hub gas, European nitrogen, phosphate and potash), each walking nutrient prices from the starting point back to mid-cycle through a ten-year free-cash-flow schedule with working capital and sustaining capex; a valuation summary setting each DCF beside the multiple cross-check and splitting the gap between them; cycle scenarios, a cost curve with a gas cost curve, a leverage screen on mid-cycle EBITDA and two live sensitivity grids, urea price against the exit multiple and against the gas price. Change the nutrient price, the gas price or the WACC and the value moves.
See what's in the Fertilisers Sector Primer →£25 PDF · £59 with the Excel model · £159 for all three Agribusiness industries
Frequently Asked Questions
- What are the three main fertiliser nutrients?
- Nitrogen (N), phosphate (P) and potash (K). Nitrogen comes from ammonia, made from natural gas by the Haber-Bosch process. Phosphate comes from phosphate rock treated with sulphur and ammonia to make fertilisers such as DAP. Potash is potassium chloride (MOP), mined, or in Israel recovered from the Dead Sea in evaporation ponds. Each has a different cost driver: gas for N, rock and ammonia for P, ore grade and freight for K.
- Why do fertiliser companies specialise in different nutrients?
- The upstream economics differ. Nitrogen margin is set by gas cost. Phosphate margin depends on owned versus bought rock plus the cost of ammonia and sulphur. Potash margin depends on mine type, royalties and freight to import markets such as Brazil. Few producers span all three equally: CF Industries makes only nitrogen, Mosaic phosphate and potash, and Nutrien all three plus retail.
- What nutrient benchmarks set industry revenue?
- Three world benchmarks: urea at Middle East export ports (FOB), granular potash landed in Brazil (CFR), and DAP at US Gulf export ports (FOB). Mosaic's FY2025 potash price at the mine was $255/t, so it compares with the Brazil price only once the freight is added.
- How does Nutrien's integrated model differ from pure-play peers?
- Nutrien's segments earned $6,519M in FY2025: Potash $2,254M, Nitrogen $2,147M, Phosphate $382M and Retail $1,736M. After $473M of corporate and other costs, adjusted EBITDA was $6,046M. CF Industries earned $2,893M from nitrogen alone (19.06M short tons of product). Mosaic's segments earned $2,667M (Phosphates $917M, Potash $1,183M and Mosaic Fertilizantes, its Brazilian arm, $567M), and $2,421M after corporate costs, with no nitrogen segment.
Read next
Natural Gas and Nitrogen Fertiliser Costs
How the Haber-Bosch route links gas to ammonia, why gas dominates the cost of nitrogen, the gap between US and European gas costs, and the gas sensitivities CF and Nutrien file.
Fertiliser Cost Curves Explained
How nitrogen, phosphate, and potash cost curves are set by gas access, rock integration, and ore grade, with FY2025 disclosed unit costs from Nutrien, Mosaic, and Intrepid Potash.
Fertiliser Price Benchmarks: FOB vs CFR
What FOB, CFR and CIF mean for a fertiliser price, how producers report the prices they realise, and why a price and a cost give a true margin only on the same delivery basis.
Fertiliser EBITDA per Tonne by Nutrient
FY2025 EBITDA per tonne sold for each nutrient business at Nutrien, CF Industries, Mosaic and ICL, why the tonne and the price basis belong on every figure, and how to rebuild it from price and cost.
See it applied
These company profiles apply the concepts from this guide to real public companies.