Mosaic Cuts Phosphate Production Amid Record Sulfur Costs, Confirms Q2 Headwinds

The Mosaic Company (NYSE: MOS) has recently implemented significant structural changes in its phosphate operations in response to sharply elevated sulfur prices and constrained availability, the company confirmed in its Q2 2026 earnings release and related filings.

Phosphate Curtailed as Sulfur Prices Soar

Mosaic announced temporary idling and reduced output across multiple phosphate facilities: operations at its Uncle Sam and Faustina sites in Louisiana were idled or curtailed, while production at its Florida plants—including Bartow—was scaled back. In Brazil, additional facilities were also temporarily curtailed or idled as the company navigated raw‑material constraints. These actions stem from staggering increases in sulfur prices, which escalated from roughly $280 per tonne before 2026 to as high as $1,000 globally during intensified geopolitical disruptions, according to the company’s public commentary on cost pressures.

In its Q2 2026 earnings release, Mosaic reported net sales of $2.8 billion, an operating loss of $36 million and a net loss of $273 million. The company also removed its phosphate production guidance for the full year, while maintaining its potash guidance at around 9 million tonnes. Capital expenditures guidance was reduced to $1.2 billion, down from the prior forecast of $1.25 billion.

Financial Performance Highlights

In phosphate, Q2 net sales rose to $1.246 billion from $1.173 billion year‑over‑year, yet the segment delivered an operating loss of $104 million, compared with an $8 million loss in Q2 2025. Segment adjusted EBITDA dropped from $217 million to $128 million, weighed down by surging material costs and lower production volumes.

The Mosaic Fertilizantes segment—covering Brazil operations—recorded net sales of $1 billion in Q2, down from $1.2 billion in the prior-year period. The unit posted an operating loss of $41 million (versus operating earnings of $109 million a year earlier), and adjusted EBITDA slid from $159 million to $60 million, driven by curtailed output and elevated sulfur costs.

Potash performance remained steady. Sales volumes fell to 2.0 million tonnes from 2.3 million tonnes year‑over‑year due to routine turnarounds and the April sale of the Carlsbad mine. Net sales declined to $650 million from $711 million, but operating earnings held firm at $195 million, matching the prior year, and adjusted EBITDA remained stable at $278 million.

Sulfur Contracting & Pricing Dynamics

During the earnings period, Mosaic settled third‑quarter sulfur contracts at $705 per long ton—well below prevailing spot rates, offering some near‑term cost relief.

Significance and Risks Ahead

Mosaic’s decision to withdraw phosphate guidance, curtail production, and reduce capital expenditures reflects acute cost pressures across its fertilizer operations. While potash remains a profitable anchor, the company’s phosphate business faces an uncertain path back to full capacity without relief in sulfur markets.

Investors should monitor sulfur price trends, supply stability, and Mosaic’s progress on Brazil asset divestiture strategies as critical indicators for when phosphate production can ramp up profitably.