Nutrien gives strong profit outlook on surging potash prices

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A general view of Nutrien's Cory potash mine is seen near Saskatoon, Saskatchewan, Canada August 12, 2019. REUTERS/Nayan Sthankiya

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Feb 16 (Reuters) - Canadian fertilizer maker Nutrien Ltd (NTR.TO), said on Wednesday a surge in prices of potash due to robust global demand and thin supply would boost its profit in 2022, sending its U.S. shares more than 5% higher in extended trading.

The company forecast annual adjusted profit between $10.20 and $11.80 per share, above analysts' average estimate of $9.46 per share, according to IBES data from Refinitiv.

Prices of potash - a crucial crop nutrient - are near multi-year highs in the United States and Brazil following Western economic sanctions against a major potash supplier in Belarus. read more

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The company said it expected the supply issues to continue into 2022, including additional restrictions imposed on Belarus potash transported through Lithuania.

Its earnings last year also benefited from record global potash demand of around 70 million tonnes, helping Nutrien post a nearly fourfold jump in profit for the fourth quarter.

The fertilizer maker expects strong corn and soybean prices, along with prospective crop margins that are well above the 10-year average, to encourage growers to invest in their crops.

It declared a quarterly dividend of 48 cents per share, an increase of 4% from a year earlier, and also announced a share repurchase of up to 10% of its public float.

On an adjusted basis, the company posted a profit of $2.47 per share, beating estimates of $2.35 per share.

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Reporting by Rithika Krishna in Bengaluru; Editing by Shounak Dasgupta and Aditya Soni

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