Agrium Falls on Outlook for U.S. Corn Prices: Calgary Mover

Agrium Inc. (AGU), the largest supplier of fertilizer and seeds to U.S. farmers, fell the most in three months after the U.S. government forecast a drop in corn prices amid expectations for a record crop.

Shares of the Calgary-based company declined 5.2 percent to C$103.14 in Toronto, the biggest drop since Nov. 7.

Companies reliant on spending by farmers “may be losing their luster as investors probably realize the near-term top is in the rear-view mirror,” Robert Winslow, a Toronto-based analyst at National Bank Financial, said today by e-mail.

The U.S. Agriculture Department yesterday forecast corn prices paid to farmers in the 12 months that will begin Sept. 1 will average $4.80 a bushel, down 33 percent from a record $7.20 predicted for this year.

Corn stockpiles before next year’s harvest may rise to 2.177 billion bushels from a 17-year low of 632 million projected this year, the U.S. Department of Agriculture said today in a report.

Through yesterday, corn futures on the Chicago Board of Trade dropped 19 percent from a record $8.49 on Aug. 10.

Agrium yesterday reported adjusted fourth-quarter profit that beat analyst’s expectations. Profit, excluding one-time items, was $2.16 a share, more than the $2.03 average of 20 estimates compiled by Bloomberg.

“The beat was largely because of a 12-cent-a-share EPS bump from interest income, which is hardly anything to get excited about,” Winslow said.

Potash Corp. of Saskatchewan Inc., the world’s largest fertilizer producer by market value, fell 1 percent to C$39.96 in Toronto. Mosaic Co. (MOS), the largest maker of phosphate fertilizer, dropped 0.5 percent to $57.47.

To contact the reporter on this story: Christopher Donville in Vancouver at cjdonville@bloomberg.net

To contact the editor responsible for this story: Simon Casey at scasey4@bloomberg.net