。 1EQUITIES ● AGRIBUSINESSJanuary 2019Why read this report We leverage our exposure in the US, India, Europe, China, Latin America, and Middle East to come up with a cohesive and comprehensive view of the agribusiness value chain We outline our expectation for NPK, and update our price forecasts and SD estimates We analyze the impact of NPK prices on the earnings momentum of companiesWe address investor questions related to acceleration in Chinese urea exports and theimpact of potentially lower input costs for marginal players We analyze in detail crop fundamentals and outlook for India, the major growth market for fertilizers We highlight our preferred plays in the space (page 8) and identify key share price catalystsEQUITIES ● AGRIBUSINESSJanuary 20192Fertilizer 101 Nitrogen (N) Phosphate (P) Potash (K)Benefits to plant Essential for stem and cell structuregrowth, increases heightAccelerated plant metabolism, optimizesusage of N & KBetter root development, fills out inner cellstructure, helps resist droughtRecommended application Every 4-6 months, nitrogen evaporates andcannot be skippedAnnual, but can be skipped for a yearwithout significant loss of yieldAnnual, but can be skipped for a yearwithout significant loss of yieldPopular products and typical nutrientcontent per unitUrea (46%), Ammonia (82%), UAN (32%),AN (34.5%), CAN (28%), AmmoniumSulphate (21%) DAP (46%), MAP (52%), SSP (22%), TSP(48%), Phosphoric acid (74%), MGA(54%), SPA (70%)MOP (60%), Potassium sulphate (50-54%)Global Ag consumption (million nutrienttonnes) - 2017/18107 (56%) 48 (25%) 35 (19%)Key crops Wheat, rice, corn, and fruit and vegetables(65-70% of total)Wheat, rice, corn, soybean, oilseeds, andfruit and vegetables (c75%)Rice, corn, wheat, soy, oil palm, fruit andvegetables, and fiber crops (c80% )Industrial use (% of total) 25-30% 12% 9%Primary industrial use Plastics, resins, adhesives,and emission controlsSoft drinks, food additives,and metal treatmentsSoaps, water softeners, deicers, drillingmuds, and food productsKey raw materials/process Natural gas (70-80% of total cost ofammonia) and nitric acidPhosrock (50-60% of cost), sulphur (10- 15%) and ammonia (15-20%); phosrock ismined from deposits (typically shallow pit)Mined from deep rock deposits and salt lakesIndustry structure Highly fragmented Fewer suppliers than N, minimal disciplinewith a high focus on volumes;consolidating market Historically oligopolistic; landscapechanging with new suppliers coming online;top six account for 80% of shareKey industry players CF Industries, Yara, OCI, Industries Qatar,SAFCO, Nutrien, Koch, TOAZ, Eurochem,and Group DFMosaic, Maaden, Nutrien, OCP,Yuntianhua, Wengfu, and PhosAgroNutrien, Mosaic, Uralkali, Belaruskali, ICL,K+S, SQM, Arab Potash CompanyTop producers (2017) China, the US, India, and Russia constitutec55% of world capacityChina, Morocco, and the US account forc60% of world capacityCanada, Russia, Belarus, and Chinaconstitute 77% of world capacityTop consumers (2017) China, India, the US, and Brazil constitute65% of consumptionChina, India, the US, and Brazil constitute66% of consumptionChina, India, the US, and Brazil constitute61% of consumptionTop importers (2016) India, the US, and Brazil (c38% of total urea) India, Brazil, the US (c40% of DAP/MAP) Brazil, the US, China, India (c78% of total)Top exporters (2016) Russia, Qatar, China, and Saudi Arabia(c48% of urea)The US, China, and Morocco (c65% of total) Canada and FSU (c75% of total)Historical growth rate (15yr) 2.0% 2.0% 2.6%Source: Company reports, IFA, CRU, FAO, HSBC 3EQUITIES ● AGRIBUSINESSJanuary 2019Executive Summary 42019 outlook 6Nitrogen 9Phosphates 14Potash 18Companies 25Nutrien Ltd (NTR US) 26Mosaic Ltd (MOS US) 27CF Industries (CF US) 28OCI NV (OCI NA) 29UPL Ltd. (UPLL IN) 31Coromandel International (CRIN IN) 32Industries Qatar (IQCD QD) 33Disclosure appendix 43Disclaimer 48Contents。。。。。。