CF(CF) ZACKS·2025-03-24 14:10Core Viewpoint - CF Industries Holdings, Inc. is expected to benefit from increased nitrogen fertilizer demand and lower natural gas costs, despite facing challenges from soft nitrogen prices [1]. Group 1: Demand Factors - The company is experiencing rising global demand for nitrogen fertilizers, driven by significant agricultural needs and recovering industrial demand post-pandemic [5]. - High levels of corn planted acres and low nitrogen channel inventories in North America are anticipated to drive nitrogen demand [5]. - In Brazil, strong demand for urea is expected due to increased corn planting, while India is projected to see high demand driven by low inventory levels [7]. Group 2: Supply and Pricing Dynamics - CF anticipates a positive global supply-demand balance, with inventories considered below normal and production challenges for marginal producers in Europe [6]. - The company has noted that its average selling prices in 2024 were lower than in 2023 due to increased global supply and lower energy costs, which have pressured nitrogen prices [9]. Group 3: Cost Factors - The company has benefited from lower natural gas prices, with the average cost falling from 2.43 per MMBtu in the fourth quarter [8]. - The decline in natural gas costs has led to a reduction in the company's cost of sales, with expectations for continued benefits into 2025 [8].