* Sees fertilizer demand rebounding in fall
* Remains committed to acquiring CF Industries
(Adds CEO comments; in U.S. dollars unless noted)
By Euan Rocha
TORONTO, May 13 Farm products company Agrium
Inc (AGU.TO) expects fertilizer demand, which has collapsed
amid the global economic downturn, to rebound in the autumn of
2009 and spring of 2010, Chief Executive Mike Wilson said on
"Potash and phosphate are getting significantly squeezed
(this spring) and we think our sales will be down as much as 30
to 50 percent. That's the bad news, the good news is you have
to make these nutrients up ... So what we look forward to is
the fall of this year and the spring of 2010," said Wilson,
speaking to shareholders at Agrium's annual meeting.
Wilson said Agrium's strategy to invest in various
geographic regions and product lines has moderated the impact
of the recent commodity downturn on the company.
Calgary, Alberta-based Agrium is a major retail supplier of
agricultural products and services in both North and South
America. It is also a leading global producer and marketer of
nitrogen, phosphate and potash fertilizers.
Agrium's shares, along with those of its peers, have seen
some sharp swings over the last two years.
A boom in the commodity space, coupled with tight
fertilizer supplies through 2007 and the first half of 2008,
sent stocks in the sector soaring. But, tight credit markets
and a global economic slowdown have hurt grain prices and the
fortunes of companies exposed to the commodity sector.
However, Agrium's shares, which fell more than 60 percent
in the latter half of 2008, have regained some lost ground and
are up about 27 percent year-to-date at C$52.68 on the Toronto
Agrium, which has been rapidly expanding its business
through acquisitions, still plans to double the size of its
retail business, said Wilson.
The company is confident that it can meet and even exceed
its goal to generate annualized savings of $80 million in 2009,
from its acquisition of agricultural products distributor UAP,
a year ago.
Wilson also reiterated Agrium's commitment to its bid for
U.S. rival CF Industries (CF.N). CF has rebuffed Agrium's
overtures thus far, but its board is currently reviewing a
sweetened bid from Agrium worth about $4.18 billion.
CF has thus far maintained that Agrium's initial offers
undervalued their company and were merely a ploy to derail CF's
own bid for rival Terra Industries TRA.N. Terra's board has
rejected CF's current offer.
If Agrium is successful in its bid for CF Industries, that
would boost its competitive position and triple its capacity to
produce phosphate and UAN -- a solution of urea and ammonium
nitrate in water, which is used as a fertilizer.
"It (the acquisition) is compelling. We don't do things if
they are not compelling from a strategic point of view. And it
is not just compelling for Agrium, but compelling for CF
shareholders too," said Wilson.
"We are committed to it, but also we are very disciplined
and will not overpay for CF," he added.
(Reporting by Euan Rocha; editing by Rob Wilson)