Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

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Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following Management’s Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with the material under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in the Annual Report on Form 10-K of The Mosaic Company filed with the Securities and Exchange Commission for the year ended December 31, 2022 (the “10-K Report”) and the material under Item 1 of Part I of this report.

Throughout the discussion below, we measure units of production, sales and raw materials in metric tonnes, which are the equivalent of 2,205 pounds, unless we specifically state we mean long ton(s), which are the equivalent of 2,240 pounds. In the following tables, there are certain percentages that are not considered to be meaningful and are represented by “NM.”


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Results of Operations

The following table shows the results of operations for the three and six months ended June 30, 2023 and June 30, 2022:


	Three months ended										Six months ended
	June 30,						2023-2022				June 30,						2023-2022
(in millions, except per share data)	2023			2022			Change		Percent		2023			2022			Change		Percent
Net sales	$	3,394.0		$	5,373.1		$	(1,979.1)	(37)	%	$	6,998.3		$	9,295.4		$	(2,297.1)	(25)	%
Cost of goods sold	2,822.9			3,526.8			(703.9)		(20)	%	5,756.8			6,010.0			(253.2)		(4)	%
Gross margin	571.1			1,846.3			(1,275.2)		(69)	%	1,241.5			3,285.4			(2,043.9)		(62)	%
Gross margin percentage	17		%	34		%					18		%	35		%
Selling, general and administrative expenses	129.9			108.2			21.7		20	%	257.6			240.6			17.0		7	%


Other operating expense	72.0			63.9			8.1		13	%	70.1			114.8			(44.7)		(39)	%
Operating earnings	369.2			1,674.2			(1,305.0)		(78)	%	913.8			2,930.0			(2,016.2)		(69)	%

Interest expense, net	(36.0)			(34.1)			(1.9)		6	%	(77.1)			(73.4)			(3.7)		5	%
Foreign currency transaction gain	148.5			(227.2)			375.7		NM		199.9			83.5			116.4		139	%
Other expense	(7.1)			(35.7)			28.6		(80)	%	(16.0)			(35.5)			19.5		(55)	%
Earnings from consolidated companies before income taxes	474.6			1,377.2			(902.6)		(66)	%	1,020.6			2,904.6			(1,884.0)		(65)	%
Provision for income taxes	108.4			369.3			(260.9)		(71)	%	226.7			741.7			(515.0)		(69)	%
Earnings from consolidated companies	366.2			1,007.9			(641.7)		(64)	%	793.9			2,162.9			(1,369.0)		(63)	%
Equity in net earnings of nonconsolidated companies	12.9			35.9			(23.0)		(64)	%	44.2			66.6			(22.4)		(34)	%
Net earnings including noncontrolling interests	379.1			1,043.8			(664.7)		(64)	%	838.1			2,229.5			(1,391.4)		(62)	%
Less: Net earnings attributable to noncontrolling interests	10.1			7.9			2.2		28	%	34.3			11.6			22.7		196	%
Net earnings attributable to Mosaic	$	369.0		$	1,035.9		$	(666.9)	(64)	%	$	803.8		$	2,217.9		$	(1,414.1)	(64)	%
Diluted net earnings per share attributable to Mosaic	$	1.11		$	2.85		$	(1.74)	(61)	%	$	2.39		$	6.05		$	(3.66)	(60)	%
Diluted weighted average number of shares outstanding	333.7			363.1							336.2			366.5

Overview of Consolidated Results for the three months ended June 30, 2023 and 2022

For the three months ended June 30, 2023, Mosaic had net income of $369.0 million, or $1.11 per diluted share, compared to net income of $1.0 billion, or $2.85 per diluted share, for the prior year period. Net sales for the three months ended June 30, 2023 decreased 37% compared to the same period of the prior year, driven by lower average selling prices, as discussed further below. Net income for the three months ended June 30, 2023 was also positively impacted by a foreign currency transaction gain of $148.5 million, compared to a foreign currency transaction loss of $227.2 million in the prior year period.

Significant factors affecting our results of operations and financial condition are listed below. Certain of these factors are discussed in more detail in the following sections of this Management’s Discussion and Analysis of Financial Condition and Results of Operations.

For the three months ended June 30, 2023, operating results in all of our segments were impacted by lower average sales prices compared to the prior year period. Global markets have softened compared to the prior year period, as buyers have delayed purchases in anticipation of lower prices. Average selling prices in 2022 were driven higher by tightness in global supply and demand. In addition, the Russian invasion of Ukraine in February 2022 resulted in instability in global commodity markets and significantly reduced the supply of fertilizer and agricultural commodities produced in those geographies, which contributed to rising fertilizer prices in the prior year period.

Additionally, in July 2023, workers at four Canadian West Coast ports went on strike. This has put additional pressure on the international shipping network and has and may continue to negatively impact Canpotex's ability to ship potash product from the Port of Vancouver in the third quarter. Canpotex shipments have also been negatively impacted by equipment failure at the Port of Portland.

Our operating results for the three months ended June 30, 2023 were unfavorably impacted in our Phosphate segment compared to the prior year period due to lower average selling prices, driven by the factors described above. This was partially offset by lower raw material costs, primarily sulfur and ammonia. Operating results in the current year period were positively impacted by higher finished product sales volumes, as the prior year period was impacted by a condensed spring season caused by adverse weather conditions.

Our operating results for the three months ended June 30, 2023 were unfavorably impacted in our Potash segment due to lower average sales prices compared to the prior year period, driven by the factors discussed above. Current period operating results were also unfavorably impacted by lower sales volumes compared to the prior year period. Our sales volumes were lower in the current year period primarily due to the global market softness described above, resulting in lower export sales.

Our operating results for the three months ended June 30, 2023 were unfavorably impacted in our Mosaic Fertilizantes due to lower sales prices, which decreased globally compared to the same period in the prior year, as discussed above. Sales volumes were up slightly compared to the prior year period due to an increased customer base as a result of our growth strategy to expand our presence in Brazil.

Other Highlights

In May 2023, we entered into a 10-year senior unsecured term loan facility whereby we can draw up to $700 million. The term loan matures on May 18, 2033. As of June 30, 2023, we have not drawn any amounts under this facility.

Overview of Consolidated Results for the six months ended June 30, 2023 and 2022

Net earnings attributable to Mosaic for the six months ended June 30, 2023 was $803.8 million, or $2.39 per diluted share, compared to net earnings of $2.2 billion, or $6.05 per diluted share, for the same period a year ago. Net income for the three months ended June 30, 2023 was also positively impacted by a foreign currency transaction gain of $199.9 million, compared to $83.5 million in the prior year period.

Results for the six months ended June 30, 2023 and 2022 reflected the factors discussed above in the discussion for the three months ended June 30, 2023 and 2022, in addition to those noted below. Certain of these factors are discussed in more detail in the following sections of this Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Operating results in our Phosphate segment for the six months ended June 30, 2023 were unfavorably impacted compared to the prior year period due to lower average selling prices, driven by the factors described above in the three-month discussion. This was partially offset by lower raw material costs, primarily sulfur and ammonia. Operating results in the current year period were positively impacted by higher finished product sales volumes, driven by the factor mentioned above in the three-month discussion.

Operating results in our Potash segment for the six months ended June 30, 2023 were unfavorably impacted by a decrease in the average selling price of potash compared to the prior year period as described above in the three-month discussion. Current year operating results were also unfavorably impacted by higher idle plant and maintenance turnaround costs due to the temporary idling of our Colonsay, Saskatchewan mine, due to market conditions, and the timing of turnarounds compared to the prior year.

For the six months ended June 30, 2023, operating results in our Mosaic Fertilizantes segment were unfavorably impacted by a decrease in average sales prices in the current year compared to the prior year period as discussed above in the three-month discussion. Sales volumes of finished goods, including performance products, were higher in the current year period compared to the same period in the prior year, due to an increased customer base as a result of our growth strategy to expand our presence in Brazil. Sales volumes of other products, primarily gypsum and acids, were lower than the prior year period, driven by unfavorable weather, and sulfuric acid availability in the current year period.


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Other Highlights

In addition to the highlight referenced above,

On January 12, 2023, we completed the sale of the Streamsong Resort® (the “Resort”) and the approximately 7,000 acres on which it sits for net proceeds of $158 million. The Resort is a destination resort and conference center, which we developed in an area of previously mined land as part of our long-term business strategy to maximize the value and utility of our extensive land holdings in Florida. In addition to a hotel and conference center, the Resort includes multiple golf courses, a clubhouse and ancillary facilities. The sale resulted in a gain of $57 million.
On January 17, 2023, we purchased the other 50% interest of equity of Gulf Sulphur Services (“GSS”), which gives us full ownership and secures control of our sulfur supply chain in the Gulf of Mexico.
On February 24, 2023, pursuant to existing stock repurchase authorizations, we entered into an accelerated share repurchase agreement (the “2023 ASR Agreement”) with a third-party financial institution to repurchase $300 million of our Common Stock. During the six months ended June 30, 2023, we repurchased 8,690,936 shares of Common Stock in the open market for approximately $448.0 million. This includes 5,624,574 shares purchased under the 2023 ASR Agreement at an average purchase price of $53.34 per share.
In March 2023, we paid a special dividend of $0.25 per share to our stockholders.


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Phosphate Net Sales and Gross Margin

The following table summarizes the Phosphate segment’s net sales, gross margin, sales volume, selling prices and raw material prices:


	Three months ended										Six months ended
	June 30,						2023-2022				June 30,						2023-2022
(in millions, except price per tonne or unit)	2023			2022			Change		Percent		2023			2022			Change		Percent
Net sales:
North America	$	1,081.1		$	919.1		$	162.0	18	%	$	2,005.9		$	1,923.5		$	82.4	4	%
International	204.6			881.8			(677.2)		(77)	%	661.9			1,373.4			(711.5)		(52)	%
Total	1,285.7			1,800.9			(515.2)		(29)	%	2,667.8			3,296.9			(629.1)		(19)	%
Cost of goods sold	1,069.5			1,159.3			(89.8)		(8)	%	2,192.3			2,127.6			64.7		3	%
Gross margin	$	216.2		$	641.6		$	(425.4)	(66)		$	475.5		$	1,169.3		$	(693.8)	(59)	%
Gross margin as a percentage of net sales	17		%	36		%					18		%	35		%
Sales volumes(a) (in thousands of metric tonnes)
DAP/MAP	928			814			114		14	%	1,950			1,731			219		13	%
Performance and Other(b)	994			861			133		15	%	1,808			1,605			203		13	%
Total finished product tonnes	1,922			1,675			247		15	%	3,758			3,336			422		13	%
Rock	538			458			80		17	%	909			918			(9)		(1)	%
Total Phosphate Segment Tonnes(a)	2,460			2,133			327		15	%	4,667			4,254			413		10	%
Realized prices ($/tonne)
Average finished product selling price (destination)(c)	$	634		$	1,048		$	(414)	(40)	%	$	674		$	963		$	(289)	(30)	%
DAP selling price (fob plant)	$	585		$	920		$	(335)	(36)	%	$	628		$	841		$	(213)	(25)	%

Average cost per unit consumed in cost of goods sold:
Ammonia (metric tonne)	$	441		$	591		$	(150)	(25)	%	$	506		$	575		$	(69)	(12)	%
Sulfur (long ton)	$	195		$	385		$	(190)	(49)	%	$	210		$	302		$	(92)	(30)	%
Blended rock (metric tonne)	$	79		$	64		$	15	23	%	$	76		$	63		$	13	21	%
Production volume (in thousands of metric tonnes) - North America	1,660			1,636			24		1	%	3,496			3,381			115		3	%

____________________________

(a) Includes intersegment sales volumes.

(b) Includes sales volumes of MicroEssentials® and animal feed ingredients.

Three months ended June 30, 2023 and June 30, 2022

The Phosphate segment’s net sales were $1.3 billion for the three months ended June 30, 2023, compared to $1.8 billion for the three months ended June 30, 2022. The decrease in net sales in the current year period was primarily due to lower average finished goods sales prices, which had an unfavorable impact of approximately $700 million compared to the prior year period. This was partially offset by higher finished product sales volumes in the current period, which had a favorable impact on net sales of approximately $230 million compared to the prior year period. Net sales were also unfavorably impacted by approximately $40 million, due to decreased sales of raw materials of approximately $70 million, which were driven by lower sales volumes and prices. This impact was partially offset by increased sales from Miski Mayo of approximately $30 million, compared to the prior year period.


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Our average finished product selling price decreased 40% to $634 per tonne for the three months ended June 30, 2023, compared to $1,048 per tonne in the prior year period, due to the factors discussed in the Overview.

The Phosphate segment’s sales volumes of finished products increased by 15% for the three months ended June 30, 2023, compared to the same period in the prior year, due to the factors discussed in the Overview.

Gross margin for the Phosphate segment decreased to $216.2 million for the three months ended June 30, 2023, from $641.6 million for the three months ended June 30, 2022. The decrease in gross margin in the current year period was primarily due to lower sales prices, which unfavorably impacted gross margin by approximately $700 million. Gross margin was also unfavorably impacted by approximately $100 million, due to increased conversion costs, higher cost of blended rock, and other product costs. This was partially offset by decreased raw material prices in the current period, driven by sulfur and ammonia, which favorably impacted gross margin by approximately $200 million. In addition, higher sales volumes, which had a favorable impact of approximately $100 million, and lower costs of approximately $50 million primarily related to the timing of idle plant and turnaround costs in the current year period also partially offset this gross margin variance.

The average consumed price for ammonia for our North America operations decreased 25% to $441 per tonne for the three months ended June 30, 2023, from $591 in the same period a year ago. The average consumed sulfur price for our North America operations decreased 49%, to $195 per long ton, for the three months ended June 30, 2023, from $385 in the same period a year ago. The purchase prices of these raw materials are driven by global supply and demand. The consumed ammonia and sulfur prices also include transportation, transformation and storage costs.

The average consumed cost of purchased and produced phosphate rock increased to $79 per tonne for the three months ended June 30, 2023, from $64 for the three months ended June 30, 2022, primarily due to an increase in processing costs and using more Miski Mayo rock in the current year period. For the three months ended June 30, 2023, our North America phosphate rock production decreased to 2.2 million tonnes from 2.5 million tonnes during the same period of the prior year, due to geology of rock and operational challenges.

The Phosphate segment’s production of crop nutrient dry concentrates and animal feed ingredients increased 1% for the three months ended June 30, 2023 from the prior year period. Our operating rate for processed phosphate production increased to 67% for the three months ended June 30, 2023, from 66% for the same period in 2022.

Six months ended June 30, 2023 and June 30, 2022

The Phosphate segment’s net sales were $2.7 billion for the six months ended June 30, 2023, compared to $3.3 billion for the six months ended June 30, 2022. The decrease in net sales was primarily due to lower finished product selling prices in the current year period, which unfavorably impacted net sales by approximately $940 million compared to the prior year period. This was partially offset by higher sales volumes of finished goods, which favorably impacted net sales by approximately $360 million. Net sales were also unfavorably impacted by approximately $50 million due to lower sales of raw materials of approximately $110 million, driven by lower sales prices. This impact was partially offset by favorable sales from Miski Mayo of approximately $60 million compared to the prior year period.

Our average finished product selling price was $674 per tonne for the six months ended June 30, 2023, a decrease of $289 per tonne from the same period a year ago, due to the factors discussed in the Overview.

The Phosphate segment’s sales volumes of finished products increased by 13% for the six months ended June 30, 2023, compared to the same period in the prior year ago, due to the factor discussed in the Overview.

Gross margin for the Phosphate segment decreased to $475.5 million for the six months ended June 30, 2023, from $1.2 billion for the six months ended June 30, 2022. The decrease in gross margin in the current year period was primarily due to the impact of lower finished product prices of approximately $940 million compared to the prior year period. Gross margin was also unfavorably impacted by approximately $100 million, due to increased conversion and other costs resulting from higher maintenance and water management costs in the current period. Increased cost of blended rock unfavorably impacted gross margin by approximately $70 million, due to higher input costs. These increases were partially offset by lower raw material costs of sulfur and ammonia as discussed below, which impacted gross margin by approximately $200 million. Gross margin was also favorably impacted by approximately $160 million due to higher sales volumes, and lower costs of approximately $40 million related to the timing of idle plant and turnaround costs in the current year period.


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The average consumed price for ammonia for our North America operations was $506 per tonne for the six months ended June 30, 2023, compared to $575 in the same period a year ago. The average consumed price for sulfur for our North America operations decreased to $210 per long ton for the six months ended June 30, 2023, from $302 in the same period a year ago. The purchase prices of these raw materials are driven by global supply and demand.

The average consumed cost of purchased and produced phosphate rock increased to $76 per tonne for the six months ended June 30, 2023, compared to $63 per tonne for the prior year period, primarily due to using more Miski Mayo rock in the current year period. Our North America phosphate rock production decreased to 4.4 million tonnes for the six months ended June 30, 2023, compared to 4.6 million for the six months ended June 30, 2022, due to geology of rock and operational challenges.

The Phosphate segment’s production of crop nutrient dry concentrates and animal feed ingredients increased by 3%, to 3.5 million tonnes for the six months ended June 30, 2023, compared to 3.4 million tonnes in the prior year period. For the six months ended June 30, 2023, our operating rate for processed phosphate production increased to 70%, compared to 68% in the same period of the prior year.

Potash Net Sales and Gross Margin

The following table summarizes the Potash segment’s net sales, gross margin, sales volume and selling price:


	Three months ended										Six months ended
	June 30,						2023-2022				June 30,						2023-2022
(in millions, except price per tonne or unit)	2023			2022			Change		Percent		2023			2022			Change		Percent
Net sales:
North America	$	534.2		$	657.9		$	(123.7)	(19)	%	$	988.3		$	1,188.0		$	(199.7)	(17)	%
International	314.5			922.3			(607.8)		(66)	%	767.0			1,452.0			(685.0)		(47)	%
Total	848.7			1,580.2			(731.5)		(46)	%	1,755.3			2,640.0			(884.7)		(34)	%
Cost of goods sold	512.7			652.6			(139.9)		(21)	%	1,006.0			1,133.5			(127.5)		(11)	%
Gross margin	$	336.0		$	927.6		$	(591.6)	(64)	%	$	749.3		$	1,506.5		$	(757.2)	(50)	%
Gross margin as a percentage of net sales	40		%	59		%					43		%	57		%



Sales volume(a) (in thousands of metric tonnes)
MOP	1,883			2,045			(162)		(8)	%	3,579			3,577			2		0	%
Performance and Other(b)	280			259			21		8	%	494			519			(25)		(5)	%
Total Potash Segment Tonnes	2,163			2,304			(141)		(6)	%	4,073			4,096			(23)		(1)	%
Realized prices ($/tonne)
Average finished product selling price (destination)	$	392		$	686		$	(294)	(43)	%	$	431		$	645		$	(214)	(33)	%
MOP selling price (fob mine)	$	326		$	678		$	(352)	(52)	%	$	370		$	638		$	(268)	(42)	%
Production volume (in thousands of metric tonnes)	1,921			2,436			(515)		(21)	%	3,865			4,636			(771)		(17)	%

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(a) Includes intersegment sales volumes.

(b) Includes sales volumes of K-Mag®, Aspire® and animal feed ingredients.

Three months ended June 30, 2023 and June 30, 2022

The Potash segment’s net sales decreased to $848.7 million for the three months ended June 30, 2023, compared to $1.6 billion in the same period a year ago. The decrease was primarily due to lower selling prices, which had an unfavorable impact on net sales of approximately $660 million, compared to the same period in the prior year. Net sales was also unfavorably impacted by lower sales volumes of approximately $70 million.

Our average finished product selling price was $392 per tonne for the three months ended June 30, 2023, compared to $686 per tonne for the same period a year ago, as a result of the factor described in the Overview.


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The Potash segment’s sales volumes of finished products decreased to 2.2 million tonnes for the three months ended June 30, 2023, compared to 2.3 million tonnes in the same period a year ago, due to the factors discussed in the Overview.

Gross margin for the Potash segment decreased to $336.0 million for the three months ended June 30, 2023, from $927.6 million in the same period of the prior year. The decrease in gross margin in the current year period is primarily due to lower selling prices, which negatively impacted gross margin by approximately $660 million compared to the prior year period, and lower sales volumes, which had an unfavorable impact on gross margin of approximately $75 million. Higher idle and turnaround costs negatively impacted gross margin by approximately $25 million compared to the prior year, largely due to the idling of our Colonsay, Saskatchewan mine in the current year period as well as maintenance at our Carlsbad, New Mexico mine. Gross margin was also unfavorably impacted by higher fixed cost absorption of approximately $10 million compared to the prior year period, which was driven by lower production volumes. The decreases were partially offset by $198 million reduction in Canadian resource taxes and royalties compared to the prior year, as discussed below.

We had expense of $95.0 million from Canadian resource taxes for the three months ended June 30, 2023, compared to $274.5 million in the same period a year ago. Canadian royalty expense decreased to $12.9 million for the three months ended June 30, 2023, compared to $31.5 million for the three months ended June 30, 2022. The fluctuations in Canadian resource taxes and royalties are a result of a decrease in our sales revenue and margins.

Our operating rate for potash production was 69% for the current year period, compared to 87% in the prior year period. The decreased operating rate reflects the temporary idling of our Colonsay, Saskatchewan mine and maintenance turnarounds during the quarter. In July 2023, we temporarily restarted Colonsay to offset downtime from the summer turnaround at our Esterhazy mine.

Six months ended June 30, 2023 and June 30, 2022

The Potash segment’s net sales decreased to $1.8 billion for the six months ended June 30, 2023, compared to $2.6 billion in the same period a year ago. The decrease was due to lower selling prices, which had an unfavorable impact on net sales of approximately $900 million. This was partially offset by sales of other products of approximately $15 million.

Our average potash selling price was $431 per tonne for the six months ended June 30, 2023, compared to $645 per tonne for the same period a year ago, due to the factors discussed above in the Overview.

The Potash segment’s sales volumes for the six months ended June 30, 2023 decreased 1% compared to the same period a year ago.

Gross margin for the Potash segment decreased to $749.3 million for the six months ended June 30, 2023, from $1.5 billion for the same period in the prior year. Gross margin was unfavorably impacted by approximately $900 million, due to the decrease in average selling prices, and by slightly lower sales volumes, which had an unfavorable impact on net sales of approximately $10 million. Gross margin was also unfavorably impacted by increased idle and turnaround costs of approximately $30 million, largely due to the idling of our Colonsay mine in the current year period, and higher fixed cost absorption, driven by lower production volumes, and plant spending of approximately $30 million compared to the prior year period. This was partially offset by lower Canadian resource taxes and royalties of approximately $240 million in the current year period, as discussed below.

We incurred $215.8 million in Canadian resource taxes for the six months ended June 30, 2023, compared to $431.7 million in the same period a year ago. Canadian royalty expense decreased to $31.6 million for the six months ended June 30, 2023, compared to $58.5 million for the six months ended June 30, 2022. The fluctuations in Canadian resource taxes and royalties are due to the decreases in our sales revenues and margins.

Our operating rate was 69% for the current year period, compared to 82% in the prior year period. The decreased operating rate reflects the temporary idling of our Colonsay, Saskatchewan mine during the current year period due to market conditions, and down time for maintenance turnarounds at our Esterhazy, Saskatchewan and Carlsbad, New Mexico mines.


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Mosaic Fertilizantes Net Sales and Gross Margin

The following table summarizes the Mosaic Fertilizantes segment’s net sales, gross margin, sales volume and selling price.


	Three months ended										Six months ended
	June 30,						2023-2022				June 30,						2023-2022
(in millions, except price per tonne or unit)	2023			2022			Change		Percent		2023			2022			Change		Percent
Net Sales	$	1,418.8		$	2,259.7		$	(840.9)	(37)	%	$	2,762.1		$	3,748.3		$	(986.2)	(26)	%
Cost of goods sold	1,406.0			1,809.5			(403.5)		(22)	%	2,750.4			3,078.8			(328.4)		(11)	%
Gross margin	$	12.8		$	450.2		$	(437.4)	(97)	%	$	11.7		$	669.5		$	(657.8)	(98)	%
Gross margin as a percent of net sales	1		%	20		%					—		%	18		%
Sales volume (in thousands of metric tonnes)
Phosphate produced in Brazil(a)	611			638			(27)		(4)	%	1,121			1,375			(254)		(18)	%
Potash produced in Brazil	44			46			(2)		(4)	%	88			92			(4)		(4)	%
Purchased nutrients for distribution	1,730			1,636			94		6	%	3,256			2,675			581		22	%
Total Mosaic Fertilizantes Segment Tonnes	2,385			2,320			65		3	%	4,465			4,142			323		8	%
Realized prices ($/tonne)
Average finished product selling price (destination)	$	595		$	974		$	(379)	(39)	%	$	619		$	905		$	(286)	(32)	%
Brazil MAP price (delivered price to third party)	$	653		$	1,021		$	(368)	(36)	%	$	662		$	964		$	(302)	(31)	%
Purchases ('000 tonnes)
DAP/MAP from Mosaic	117			102			15		15	%	263			204			59		29	%
MicroEssentials® from Mosaic	427			448			(21)		(5)	%	704			696			8		1	%
Potash from Mosaic/Canpotex	756			663			93		14	%	991			1,061			(70)		(7)	%
Average cost per unit consumed in cost of goods sold:
Ammonia (metric tonne)	$	912		$	1,396		$	(484)	(35)	%	$	1,040		$	1,296		$	(256)	(20)	%
Sulfur (long ton)	$	258		$	384		$	(126)	(33)	%	$	267		$	363		$	(96)	(26)	%
Blended rock (metric tonne)	$	128		$	102		$	26	25	%	$	127		$	103		$	24	23	%
Production volume (in thousands of metric tonnes)	797			848			(51)		(6)	%	1,656			1,836			(180)		(10)	%

______________________________

(a) Excludes internally produced volumes used in purchased nutrients for distribution.

Three months ended June 30, 2023 and June 30, 2022

The Mosaic Fertilizantes segment’s net sales decreased to $1.4 billion for the three months ended June 30, 2023, from $2.3 billion in the same period a year ago. The decrease in net sales was due to lower finished product sales prices, which unfavorably impacted net sales by approximately $770 million, and lower sales volumes of other products, primarily gypsum, which unfavorably impacted net sales by approximately $130 million. This was partially offset by higher finished goods sales volumes, which had a favorable impact of approximately $60 million.

Our average finished product selling price was $595 per tonne for the three months ended June 30, 2023, compared to $974 per tonne for the same period a year ago, due to the decrease in global sales prices as discussed in the Overview.

The Mosaic Fertilizantes segment’s sales volumes of finished products increased 3% for the three months ended June 30, 2023, compared to the same period a year ago.

Gross margin for the Mosaic Fertilizantes segment decreased to $12.8 million for the three months ended June 30, 2023, from $450.2 million in the same period of the prior year. The decrease in gross margin was primarily due to an unfavorable impact of


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approximately $770 million related to the decrease in selling prices during the current year period, compared to the prior year period. Gross margin was also unfavorably impacted by approximately $10 million due to lower sales prices of other products, primarily acids, and unfavorable foreign currency impacts of approximately $20 million. Lower costs had a favorable impact of $370 million, driven by a decrease in product costs for our distribution business, and lower sulfur and ammonia costs in our production business.

The average consumed price for ammonia for our Brazilian operations decreased to $912 per tonne for the three months ended June 30, 2023, compared to $1,396 per tonne in the prior year period. The average consumed sulfur price for our Brazilian operations was $258 per long ton for the three months ended June 30, 2023, compared to $384 per long ton in the prior year period. The purchase prices of ammonia and sulfur are driven by global supply and demand, and also include transportation, transformation, and storage costs.

The Mosaic Fertilizantes segment's production of crop nutrient dry concentrates and animal feed ingredients decreased 6% for the three months ended June 30, 2023 compared to the prior year period, due to down time for plant maintenance. For the three months ended June 30, 2023, our phosphate operating rate decreased to 74%, compared to 83% in the same period of the prior year.

For the three months ended June 30, 2023, our Brazilian phosphate rock production was in line with the prior year period, at approximately 1.1 million tonnes.

Six months ended June 30, 2023 and 2022

The Mosaic Fertilizantes segment’s net sales were $2.8 billion for the six months ended June 30, 2023, compared to $3.7 billion in the prior year period. In the current period, net sales were unfavorably impacted by approximately $1.05 billion due to lower finished goods sales prices, partially offset by the impact of higher finished goods sales volumes of approximately $270 million. Net sales were also unfavorably impacted by decreased revenues from other products, primarily gypsum, of approximately $210 million.

The average finished product selling price decreased $286 per tonne to $619 per tonne for the six months ended June 30, 2023, compared to $905 per tonne in the prior year period, primarily due to the decrease in global prices mentioned in the Overview.

The Mosaic Fertilizantes segment’s sales volume increased to 4.5 million tonnes for the six months ended June 30, 2023, from 4.1 million tonnes in the same period a year ago, due to increased demand in our distribution business.

Gross margin for the six months ended June 30, 2023, decreased to $11.7 million from $669.5 million in the same period in the prior year. In the current year period, gross margin was unfavorably impacted by unfavorable sales prices of approximately $1.05 billion, and an unfavorable impact from sales volumes of approximately $20 million. Gross margin was also unfavorably impacted by lower sales volumes and sales prices of other products, primarily acids, of approximately $40 million, and unfavorable foreign currency impacts of approximately $20 million. In the current year period, gross margin was favorably impacted by approximately $470 million related to lower product costs, primarily reductions in material purchases by our distribution business and raw materials costs.

The Mosaic Fertilizantes segment’s production of crop nutrient dry concentrates and animal feed ingredients decreased 10% compared to the prior year period due to increased down time for plant maintenance. For the six months ended June 30, 2023, our phosphate operating rate was 76%, compared to 87% in the same period of the prior year.

For the six month period ended June 30, 2023, our Brazilian phosphate rock production decreased slightly to 1.9 million tonnes, from 2.0 million tonnes for the prior year period.

Corporate, Eliminations and Other

In addition to our three operating segments, we assign certain costs to Corporate, Eliminations and Other, which is presented separately in Note 18 to our Notes to Condensed Consolidated Financial Statements. Corporate, Eliminations and Other includes the results of the China and India distribution businesses, intersegment eliminations, including profit on intersegment sales, unrealized mark-to-market gains and losses on derivatives, and debt expenses. The prior year period also included the results of operations for the Resort.


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For the three months ended June 30, 2023, gross margin for Corporate, Eliminations and Other was $6.1 million, compared to $(173.1) million for the same period in the prior year. Gross margin was favorably impacted by a net unrealized gain on derivatives of approximately $34 million in the current year period, compared to a net unrealized loss of approximately $59 million in the prior year period. Gross margin was also favorably impacted by lower elimination of profit on intersegment sales in the current year period, which changed from the prior year period by approximately $215 million. Gross margin was negatively impacted due to unfavorable product costs in our distribution operations in China and India in the current year period. Sales in China and India, collectively, resulted in revenue of $171.7 million and gross margin of $(44.3) million in the current year period, compared to revenue of $389.9 million and gross margin of $64.4 million in the prior year period.

For the six months ended June 30, 2023, gross margin for Corporate, Eliminations and Other was $5.0 million, compared to $(59.9) million for the same period in the prior year. Gross margin was favorably impacted by lower elimination of profit on intersegment sales in the current year period, which changed from the prior year period by approximately $313 million. Gross margin was also favorably impacted by a net unrealized gain on derivatives of approximately $33 million in the current year period, compared to a net unrealized gain of approximately $41 million in the prior year period. Gross margin was negatively impacted due to unfavorable product costs in our distribution operations in China and India in the current year period. Sales in China and India, collectively, resulted in revenue of $438.5 million and gross margin of $(55.1) million in the current year period, compared to revenue of $610.9 million and gross margin of $151.3 million in the prior year period. The prior year period also included gross margin of approximately $15 million related to the Resort.

Other Income Statement Items


	Three months ended								Six months ended
	June 30,				2023-2022				June 30,				2023-2022
(in millions)	2023		2022		Change		Percent		2023		2022		Change		Percent
Selling, general and administrative expenses	$	129.9	$	108.2	$	21.7	20	%	$	257.6	$	240.6	$	17.0	7	%


Other operating expense	72.0		63.9		8.1		13	%	70.1		114.8		(44.7)		(39)	%

Interest expense	(47.3)		(43.1)		(4.2)		10	%	(97.5)		(87.0)		(10.5)		12	%
Interest income	11.3		9.0		2.3		26	%	20.4		13.6		6.8		50	%
Interest expense, net	(36.0)		(34.1)		(1.9)		6	%	(77.1)		(73.4)		(3.7)		5	%
Foreign currency transaction gain	148.5		(227.2)		375.7		NM		199.9		83.5		116.4		139	%
Other expense	(7.1)		(35.7)		28.6		(80)	%	(16.0)		(35.5)		19.5		(55)	%
Provision for income taxes	108.4		369.3		(260.9)		(71)	%	226.7		741.7		(515.0)		(69)	%
Equity in net earnings of nonconsolidated companies	12.9		35.9		(23.0)		(64)	%	44.2		66.6		(22.4)		(34)	%

Selling, General and Administrative Expenses

Selling, general and administrative expenses for the three months ended June 30, 2023 increased $21.7 million compared to the same period of prior year, primarily due to higher costs of approximately $15 million in consulting and professional services related to executing on our strategic initiatives, and increased compensation and benefits costs, which increased by approximately $8 million in the current period compared to the prior year period.

Selling, general and administrative expenses for the six months ended June 30, 2023 increased $17.0 million compared to the same period of prior year, primarily due to higher costs of approximately $30 million in consulting and professional services related to executing on our strategic initiatives, and increased compensation and benefits costs, which increased by approximately $10 million in the current period compared to the prior year period. This was partially offset by a decrease in incentive compensation, which decreased by approximately $25 million in the current period compared to the prior year period.

Other Operating Expense

For the three months ended June 30, 2023, we had other operating expense of $72.0 million, compared to $63.9 million for the same period of the prior year. The change from the prior year was primarily due to approximately $23 million related of upward


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revisions in estimated closure costs for our asset retirement obligations ("AROs") at our closed facilities, and $7 million related to an increase in environmental reserves. This was partially offset by insurance proceeds of approximately $21 million.

For the six months ended June 30, 2023, we had other operating expense of $70.1 million, compared to $114.8 million for the same period of the prior year. The change from the prior year period relates to a gain on the sale of the Resort of approximately $57 million and insurance proceeds of $21 million, partially offset by an increase in estimated closure costs for AROs at our closed facilities of approximately $34 million.

Foreign Currency Transaction Gain

We recorded a foreign currency transaction gain of $148.5 million for the three months ended June 30, 2023 compared to a loss of $(227.2) million for the same period in the prior year. For the three months ended June 30, 2023, the gain was the result of the effect of the weakening of the U.S. dollar relative to the Brazilian real on significant intercompany loans and U.S. dollar-denominated payables held by our Brazilian subsidiaries, and the weakening of the U.S. dollar relative to the Canadian dollar on significant intercompany loans.

We recorded a foreign currency transaction gain of $199.9 million for the six months ended June 30, 2023 compared $83.5 million for the same period in the prior year. For the six months ended June 30, 2023, the gain was the result of the effect of the weakening of the U.S. dollar relative to the Brazilian real on significant intercompany loans and U.S. dollar-denominated payables held by our Brazilian subsidiaries, and the weakening of the U.S. dollar relative to the Canadian dollar on significant intercompany loans.

Other Expense

For the three and six months ended June 30, 2023, we had other expense of $7.1 million and $16.0 million compared to $35.7 million and $35.5 million for the same periods in the prior year. The current year expense for the three month period primarily related to the write-off of assets of approximately $6 million. For the six months ended June 30, 2023, other expense primarily related to the write-off of assets of $6 million and realized losses on the marketable securities held in the RCRA Trusts of $6 million. The prior year expense for the three and six month periods was primarily related to approximately $25 million of realized losses on the marketable securities held in the RCRA Trusts and $12 million related to the write-down of an investment.

Equity in Net Earnings of Nonconsolidated Companies

For the three and six months ended June 30, 2023, we had equity in net earnings of nonconsolidated companies of $12.9 million and $44.2 million compared to $35.9 million and $66.6 million for the same periods in the prior year. These results were primarily related to the operations of MWSPC, which was unfavorably impacted by lower selling prices for its products in the current year periods.

Provision for Income Taxes


Three months ended	Effective Tax Rate		Provision for Income Taxes

June 30, 2023	22.8	%	$	108.4
June 30, 2022	26.8	%	$	369.3

Six months ended	Effective Tax Rate		Provision for Income Taxes
June 30, 2023	22.2	%	$	226.7
June 30, 2022	25.5	%	$	741.7

Income tax expense was $108.4 million and $226.7 million, and the effective tax rate was 22.8% and 22.2% for the three and six months ended June 30, 2023.


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For the three months ended June 30, 2023, discrete tax items recorded in tax expense was a benefit of approximately $9.9 million. The net tax benefit consisted primarily of share-based excess benefit, true-up of estimates, and other miscellaneous benefits. In addition to items specific to the period, our income tax rate is impacted by the mix of earnings across the jurisdictions in which we operate, by a benefit associated with depletion, a benefit associated with non-U.S. incentives, changes in valuation allowances, and by the impact of certain entities being taxed in both their foreign jurisdiction and the U.S., including foreign tax credits for various taxes incurred.

For the six months ended June 30, 2023, discrete tax items recorded in tax expense was a benefit of approximately $23.8 million. The net tax benefit consisted primarily of share-based excess benefit, true-up of estimates, and other miscellaneous costs. In addition to items specific to the period, our income tax rate is impacted by the mix of earnings across the jurisdictions in which we operate, by a benefit associated with depletion, a benefit associated with non-U.S. incentives, changes in valuation allowances and by the impact of certain entities being taxed in both their foreign jurisdiction and the U.S., including foreign tax credits for various taxes incurred.

Critical Accounting Estimates

The Condensed Consolidated Financial Statements are prepared in conformity with GAAP. In preparing the Condensed Consolidated Financial Statements, we are required to make various judgments, estimates and assumptions that could have a significant impact on the results reported in the Condensed Consolidated Financial Statements. We base these estimates on historical experience and other assumptions believed to be reasonable by management under the circumstances. Changes in these estimates could have a material effect on our Condensed Consolidated Financial Statements.

The basis for our financial statement presentation, including our significant accounting estimates, is summarized in Note 2 to the Condensed Consolidated Financial Statements in this report. A summary description of our significant accounting policies is included in Note 2 to the Consolidated Financial Statements in our 10-K Report. Further detailed information regarding our critical accounting estimates is included in Management’s Discussion and Analysis of Results of Operations and Financial Condition in our 10-K Report.

Liquidity and Capital Resources

As of June 30, 2023, we had cash and cash equivalents of $626.1 million, short-term debt of $229.0 million, long-term debt, including current maturities, of approximately $3.4 billion, and stockholders’ equity of approximately $12.6 billion. We have a target liquidity buffer of up to $3.0 billion, including cash and available committed and uncommitted credit lines. We expect our liquidity to fluctuate from time to time, especially in the first quarter of each year, to manage through the seasonality of our business. We also target debt leverage ratios that are consistent with investment grade credit metrics. Our capital allocation priorities include maintaining our target investment grade metrics and financial strength, sustaining our assets, including ensuring the safety of our employees and reliability of our assets, investing to grow our business, either through organic growth or taking advantage of strategic opportunities, and returning excess cash to shareholders, including paying our dividend. During the six months ended June 30, 2023, we returned cash to shareholders through share repurchases of $456.0 million and cash dividends of $220.1 million, and invested $631.8 million in capital expenditures.

Funds generated by operating activities, available cash and cash equivalents, and our credit facilities continue to be our most significant sources of liquidity. We believe funds generated from the expected results of operations and available cash, cash equivalents and borrowings under our committed and uncommitted credit facilities, as needed, will be sufficient to finance our operations, including our capital expenditures, existing strategic initiatives, debt repayments and expected dividend payments, for at least the next 12 months. There can be no assurance, however, that we will continue to generate cash flows at or above current levels. As of June 30, 2023, we had $2.49 billion available under our $2.50 billion committed revolving credit facility, approximately $1.0 billion available under our uncommitted facilities and had $2.3 billion available under our $2.5 billion commercial paper program, that is backed by the revolving credit facility. We view amounts borrowed under our commercial paper program as a reduction of availability under our revolving credit facility. Our credit facilities, including the revolving credit facility, require us to maintain certain financial ratios, as discussed in Note 10 of our Notes to Consolidated Financial Statements in our 10-K Report. We were in compliance with these ratios as of June 30, 2023.

All of our cash and cash equivalents are diversified in highly rated investment vehicles. Our cash and cash equivalents are held either in the U.S. or held by non-U.S. subsidiaries and are not subject to significant foreign currency exposures, as the majority


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are held in investments denominated in U.S. dollars as of June 30, 2023. These funds may create foreign currency transaction gains or losses, however, depending on the functional currency of the entity holding the cash. In addition, there are no significant restrictions that would preclude us from bringing these funds back to the U.S., aside from withholding taxes.

The following table represents a comparison of the net cash provided by operating activities, net cash used in investing activities, and net cash used in or provided by financing activities for the six months ended June 30, 2023 and June 30, 2022:


(in millions)	Six months ended
June 30,					2023-2022
Cash Flow	2023		2022			Change		Percent
Net cash provided by operating activities	$	1,221.7	$	2,091.3		$	(869.6)	(42)	%
Net cash used in investing activities	(532.9)		(561.9)			29.0		(5)	%
Net cash used in financing activities	(815.6)		(1,456.2)			640.6		(44)	%

Operating Activities

During the six months ended June 30, 2023, net cash provided by operating activities was $1.2 billion, compared to $2.1 billion for the six months ended June 30, 2022. Our results of operations, after non-cash adjustments to net earnings, contributed $1.2 billion to cash flows from operating activities during the six months ended June 30, 2023, compared to $2.9 billion as computed on the same basis for the prior year period. During the six months ended June 30, 2023, we had an favorable change in assets and liabilities of $57.0 million, compared to an unfavorable change of $809.4 million during the six months ended June 30, 2022.

The change in assets and liabilities for the six months ended June 30, 2023, was primarily driven by favorable impacts from decreases in accounts receivable of $536.3 million and inventories of $471.0 million, partially offset by a decrease in accounts payable and accrued expenses of $731.7 million. The decrease in accounts receivable was primarily related to lower selling prices at the end of the quarter compared to the end of the prior year. The decrease in inventories was primarily due to lower raw material costs in our Phosphate and Mosaic Fertilizantes segments and lower inventory volumes in North America, due to seasonality. The decrease in accounts payable and accrued liabilities was primarily related to a decrease in raw material purchase prices, the payment of taxes and payment of incentive compensation related to 2022.

Investing Activities

Net cash used in investing activities was $532.9 million for the six months ended June 30, 2023 compared to $561.9 million for the same period a year ago. We had capital expenditures of $631.8 million for the six months ended June 30, 2023, compared to $553.1 million in the prior year period. During the six months ended June 30, 2023, we completed the sale of the Resort for net proceeds of $158.4 million. During that period, we also purchased the other 50% equity of GSS for $41.0 million. GSS is now wholly owned by Mosaic.

Financing Activities

Net cash used in financing activities for the six months ended June 30, 2023, was $815.6 million, compared to $1.5 billion for the same period in the prior year. During the six months ended June 30, 2023, we made repurchases of our Common Stock at an aggregate cost of $456.0 million and paid dividends of $220.1 million. We also made net payments on our structured accounts payable arrangements of $176.5 million and payments on long-term debt of $29.1 million. We had net collections on behalf of the banks under our receivable purchasing agreement of $90.2 million and received net proceeds from short term debt of $3.9 million.

Debt Instruments, Guarantees and Related Covenants

See Notes 10 and 16 to the Consolidated Financial Statements in our 10-K Report.


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Financial Assurance Requirements

In addition to various operational and environmental regulations related to our Phosphate segment, we are subject to financial assurance requirements. In various jurisdictions in which we operate, particularly Florida and Louisiana, we are required to pass a financial strength test or provide credit support, typically in the form of surety bonds, letters of credit, certificates of deposit or trust funds. Further information regarding financial assurance requirements is included in Management’s Discussion and Analysis of Results of Operations and Financial Condition in our 10-K Report, under “EPA RCRA Initiative,” and in Note 8 to our Condensed Consolidated Financial Statements in this report.

Environmental, Health, Safety and Security Matters

Federal Jurisdiction Over “Waters of the United States.” The Clean Water Act (“CWA”)authorizes federal jurisdiction over “navigable waters,” defined in the Act as “waters of the United States” and often abbreviated as “WOTUS.” As it relates to Mosaic’s operations and facilities, the scope of the term WOTUS dictates legal requirements for our national pollutant discharge elimination system wastewater discharge permits and for impacts to surface waters and wetlands associated with our phosphate mining operations. A broad definition of WOTUS, and thus the scope of federal jurisdiction, increases the time required to identify wetlands and waterways subject to federal regulatory and permitting requirements, and the amount and type of mitigation required to compensate for impacts to jurisdictional WOTUS caused by our mining operations.

On May 25, 2023, the U.S. Supreme Court issued its opinion in the Sackett v EPA case, which significantly limits the areas that can be considered WOTUS and therefore subject to CWA Section 404 jurisdiction. The Court held that “the CWA extends only to those wetlands that are “as a practical matter indistinguishable from waters of the United States.” This requires “first, that the adjacent [body of water constitutes] . . . ‘water[s] of the United States,’ (i.e., a relatively permanent body of water connected to traditional interstate navigable waters); and second, that the wetland has a continuous surface connection with that water, making it difficult to determine where the ‘water’ ends and the ‘wetland’ begins.” The Sackett opinion relied on and quoted extensively from the Supreme Court’s 2006 plurality opinion in Rapanos v. United States, and specifically rejected the “significant nexus” test created by Justice Kennedy in his concurring opinion. The Supreme Court’s Sackett decision is binding nationwide as to the determination of which wetlands and waters are subject to the CWA.

The Sackett decision invalidated the latest regulatory definition of WOTUS promulgated by Environmental Protection Agency (“EPA”) on January 18, 2023; that regulation had significantly broadened the scope of federal jurisdiction and control over WOTUS. In response to the Sackett decision and the Court’s invalidation of the 2023 regulation, the EPA has stated its intention to promulgate a new regulation that is “consistent” with the Supreme Court’s holding by September 1, 2023.

Off-Balance Sheet Arrangements and Obligations

Information regarding off-balance sheet arrangements and obligations is included in Management’s Discussion and Analysis of Results of Operations and Financial Condition in our 10-K Report and Note 17 to our Condensed Consolidated Financial Statements in this report.

Contingencies

Information regarding contingencies is hereby incorporated by reference to Note 17 to our Condensed Consolidated Financial Statements in this report.


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Forward-Looking Statements

Cautionary Statement Regarding Forward Looking Information

All statements, other than statements of historical fact, appearing in this report constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward looking statements include, among other things, statements about our expectations, beliefs, intentions or strategies for the future, including statements about proposed or pending future transactions or strategic plans, statements concerning our future operations, financial condition and prospects, statements regarding our expectations for capital expenditures, statements concerning our level of indebtedness and other information, and any statements of assumptions regarding any of the foregoing. In particular, forward-looking statements may include words such as “anticipate”, “believe”, “could”, “estimate”, “expect”, “intend”, “may”, “potential”, “predict”, “project” or “should”. These statements involve certain risks and uncertainties that may cause actual results to differ materially from expectations as of the date of this filing.

Factors that could cause reported results to differ materially from those expressed or implied by the forward-looking statements include, but are not limited to, the following:

business and economic conditions and governmental policies affecting the agricultural industry where we or our customers operate, including price and demand volatility resulting from periodic imbalances of supply and demand;
because of political and economic instability, civil unrest or changes in government policies in Brazil, Saudi Arabia, Peru or other countries in which we do business, our operations could be disrupted as higher costs of doing business could result, including those associated with implementation of new freight tables and new mining legislation;
the continued impact of the novel coronavirus Covid-19 pandemic on the global economy and our business, suppliers, customers, employees and the communities in which we operate;
a potential drop in oil demand, which could lead to a significant decline in production, and its impact on the availability and price of sulfur, a key raw material input for our Phosphates and Mosaic Fertilizantes segment operations;
changes in farmers’ application rates for crop nutrients;
changes in the operation of world phosphate or potash markets, including consolidation in the crop nutrient industry, particularly if we do not participate in the consolidation;
the expansion or contraction of production capacity or selling efforts by competitors or new entrants in the industries in which we operate, including the effects of actions by members of Canpotex to prove the production capacity of potash expansion projects, through proving runs or otherwise;
the effect of future product innovations or development of new technologies on demand for our products;
seasonality in our business that results in the need to carry significant amounts of inventory and seasonal peaks in working capital requirements, which may result in excess inventory or product shortages;
changes in the costs, or constraints on supplies, of raw materials or energy used in manufacturing our products, or in the costs or availability of transportation for our products;
economic and market conditions, including supply chain challenges and increased costs and delays caused by transportation and labor shortages;
declines in our selling prices or significant increases in costs that can require us to write down our inventories to the lower of cost or market, or require us to impair goodwill or other long-lived assets, or establish a valuation allowance against deferred tax assets;
the lag in realizing the benefit of falling market prices for the raw materials we use to produce our products that can occur while we consume raw materials that we purchased or committed to purchase in the past at higher prices;
disruptions of our operations at any of our key production, distribution, transportation or terminaling facilities, including those of Canpotex or any joint venture in which we participate;


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shortages or other unavailability of trucks, railcars, tugs, barges and ships for carrying our products and raw materials;
the effects of and change in trade, monetary, environmental, tax and fiscal policies, laws and regulations;
foreign exchange rates and fluctuations in those rates;
tax regulations, currency exchange controls and other restrictions that may affect our ability to optimize the use of our liquidity;
risks associated with our international operations, including any potential and actual adverse effects related to the Miski Mayo Mine;
adverse weather and climate conditions affecting our operations, including the impact of potential hurricanes, excessive heat, cold, snow, rainfall or drought;
difficulties or delays in receiving, challenges to, increased costs of obtaining or satisfying conditions of, or revocation or withdrawal of required governmental and regulatory approvals, including permitting activities;
changes in the environmental and other governmental regulation that applies to our operations, including federal legislation or regulatory action expanding the types and extent of water resources regulated under federal law and the possibility of further federal or state legislation or regulatory action affecting or related to greenhouse gas emissions, including carbon taxes or other measures that may be implemented in Canada or other jurisdictions in which we operate, or of restrictions or liabilities related to elevated levels of naturally-occurring radiation that arise from disturbing the ground in the course of mining activities or possible efforts to reduce the flow of nutrients into the Gulf of Mexico, the Mississippi River basin or elsewhere;
the potential costs and effects of implementation of federal or state water quality standards for the discharge of nitrogen and/or phosphorus into Florida waterways;
the financial resources of our competitors, including state-owned and government-subsidized entities in other countries;
the possibility of defaults by our customers on trade credit that we extend to them or on indebtedness that they incur to purchase our products and that we guarantee;
any significant reduction in customers’ liquidity or access to credit that they need to purchase our products;
the effectiveness of the processes we put in place to manage our significant strategic priorities, including our investment in MWSPC, and to successfully integrate and grow acquired businesses;
actual costs of various items differing from management’s current estimates, including, among others, asset retirement, environmental remediation, reclamation or other environmental obligations and Canadian resource taxes and royalties, or the costs of MWSPC or its existing or future funding;
the costs and effects of legal and administrative proceedings and regulatory matters affecting us, including environmental, tax or administrative proceedings, complaints that our operations are adversely impacting nearby farms, businesses, other property uses or properties, settlements thereof and actions taken by courts with respect to approvals of settlements, costs related to defending and resolving global audit, appeal or court activity and other further developments in legal proceedings and regulatory matters;
the success of our efforts to attract and retain highly qualified and motivated employees;
strikes, labor stoppages or slowdowns by our work force or increased costs resulting from unsuccessful labor contract negotiations, and the potential costs and effects of compliance with new regulations affecting our workforce, which increasingly focus on wages and hours, healthcare, retirement and other employee benefits;
brine inflows at our potash mines;
accidents or other incidents involving our properties or operations, including potential fires, explosions, seismic events, sinkholes, unsuccessful tailings management, ineffective mine safety procedures, or releases of hazardous or volatile chemicals;


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terrorism, armed conflict or other malicious intentional acts, including cybersecurity risks such as attempts to gain unauthorized access to, or disable, our information technology systems, or our costs of addressing malicious intentional acts;
actions by the holders of controlling equity interests in businesses in which we hold a noncontrolling interest;
changes in our relationships with other members of Canpotex or any joint venture in which we participate or their or our exit from participation in Canpotex or any such export association or joint venture, and other changes in our commercial arrangements with unrelated third parties;

*•*difficulties in realizing benefits under our long-term natural gas based pricing ammonia supply agreement with CF, including the risks that the cost savings initially anticipated from the agreement may not be fully realized over the term of the agreement or that the price of natural gas or the market price for ammonia during the agreement’s term are at levels at which the agreement’s natural gas based pricing is disadvantageous to us, compared with purchases in the spot market; and

other risk factors reported from time to time in our SEC reports.

Material uncertainties and other factors known to us are discussed in Item 1A, “Risk Factors,” of our 10-K Report and incorporated by reference herein as if fully stated herein.

We base our forward-looking statements on information currently available to us, and we undertake no obligation to update or revise any of these statements, whether as a result of changes in underlying factors, new information, future events or other developments.


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