Mosaic will continue to benefit from a very promising long-term outlook for crop nutrient markets. Farmers will need to plant a record amount of acreage and generate ever-improving crop yields to meet projected global demand for agricultural commodities over the next decade. Near-term, grain and oilseed inventories continue to remain low relative to demand, signifying continued strong farmer economics and crop nutrient demand.
Rising incomes among a burgeoning middle class in growth regions around the world are accelerating the demand for higher-protein diets — more meat and dairy — and the grain inputs required to produce them. Nearly all of the increase in global grain and oilseed use over the past 20 years is attributable to the combined factors of global population growth and increasing per capita income levels. These dynamics make Mosaic's products and agricultural expertise increasingly crucial, and we are well positioned for continued growth and success in the years ahead.
The opportunity for Mosaic is clear and compelling, and so is our approach to capitalizing on it. Below is a list of our key initiatives for fiscal 2012:
- We will continue to drive our Potash expansion efforts. We have targeted almost $900 million in planned capital spending for Potash expansions in 2012. We expect approximately 6.2 million additional tonnes to come on line by the end of 2021, including reversion of the tolling agreement. Through these investments, we expect to maintain our top three ranking in global potash production.
- We will continue to drive operational efficiencies across and deeper into our organization, enhancing cash flow and maximizing our competitiveness. Our position as a low-cost producer of phosphate is indisputable, and we are committed to maintaining our leadership position.
- We are investing in a number of initiatives to improve performance in workplace safety, employee engagement, and customer satisfaction and loyalty, metrics we use to gauge our operational performance.
- We are investing to maintain our leadership in premium products, a position that we've established over years of development and testing and a clear differentiator for Mosaic. We plan to expand our production capacity of MicroEssentials® by 59 percent in fiscal 2012 while at the same time continuing to invest in research and development for the next generation of premium products.
- We will continue to act on our commitment to sustainability and community stewardship. We recognize the responsibility we have to make a positive impact on the world around us. Our commitment is evident every day through our community investments, land reclamation efforts, water and energy-use management, and numerous other initiatives.
Together, our success starts here.
James T. Prokopanko
President and Chief Executive Officer
August 2011