Florida’s Mosaic Swings to a Loss as Brazilian Operations Struggle

Introduction

The Mosaic Company, one of the world’s major phosphate and potash fertilizer producers, has swung to a significant loss in the second quarter of 2026 as weak operating conditions and rising input costs put pressure on its businesses.

The company reported a net loss of $273 million, or $0.86 per diluted share, for the quarter ended June 30, compared with net income of approximately $411 million in the same period a year earlier. Mosaic generated $2.82 billion in net sales and adjusted EBITDA of $407 million. (Q4 Capital)

While the headline loss reflects several significant items, the performance also highlights persistent problems within Mosaic’s Brazilian operations, particularly its Mosaic Fertilizantes business.

Brazilian Operations Remain Under Pressure

Mosaic Fertilizantes reported approximately $1.03 billion in sales during Q2 2026, up from $937 million in the first quarter. However, the improvement in revenue did not translate into stronger profitability.

Sales volumes fell to approximately 1.5 million tonnes, compared with 1.6 million tonnes in Q1 and 2.2 million tonnes in Q2 2025. Higher fertilizer prices helped offset some of the impact from lower volumes and increased raw-material costs. (AgNavigator.com)

The result demonstrates the difficult economics facing Brazil’s fertilizer industry. Higher selling prices can support revenue, but they cannot fully compensate when production volumes decline and input costs increase significantly.

Sulfur Becomes a Critical Constraint

One of the most important issues affecting Mosaic’s phosphate operations is the availability and affordability of sulfur.

Sulfur is a critical raw material for producing phosphoric acid and phosphate fertilizers. Mosaic has indicated that sulfur availability and affordability are significantly affecting phosphate production, forcing the company to curtail production at several facilities. (Fertilizer Daily)

For Brazil, the issue is particularly important because the country relies heavily on fertilizer imports while simultaneously attempting to strengthen domestic fertilizer production.

Higher sulfur costs therefore create pressure at multiple points in the supply chain—from producers to distributors and ultimately to agricultural buyers.

Production Curtailments Affect Profitability

Lower production volumes create another problem for Mosaic: fixed costs must be spread across a smaller production base.

The company has noted that reduced volumes have affected operating costs through lower absorption of fixed expenses. This creates a negative cycle in which lower production can increase the unit cost of manufacturing, further weakening margins. (Fortune)

Mosaic's second-quarter results therefore demonstrate that the problem is not simply weak fertilizer demand.

The company is also facing a cost-and-availability problem on the supply side.

Q2 Loss Was Not Entirely Operational

It is important to distinguish Mosaic’s underlying operating performance from the headline net loss.

The company reported approximately $351 million of pre-tax notable items during Q2, including the mark-to-market impact of its investment in Saudi Arabia’s Ma’aden and project-related write-offs. (TradingView)

As a result, the $273 million net loss does not represent the entire underlying performance of the fertilizer business.

Mosaic reported adjusted EBITDA of $407 million and adjusted earnings per share of $0.13 for the quarter. (Q4 Capital)

Nevertheless, the underlying operating environment remains challenging, particularly across phosphate and Brazilian operations.

Mosaic Fertilizantes Faces a Difficult Balance

The Brazilian business is caught between strong agricultural demand and difficult production economics.

Brazil is one of the world's largest agricultural markets and requires significant volumes of phosphate and potash fertilizers. This provides Mosaic with an important long-term market opportunity.

However, the economics of producing fertilizer locally depend on competitive access to raw materials, energy, logistics, and infrastructure.

When sulfur and other input costs rise sharply, importing finished fertilizer can become more attractive than producing certain products domestically.

This creates a strategic challenge for Mosaic: deciding which products and facilities remain economically competitive under changing market conditions.

Mosaic’s Earlier Restructuring Adds Context

The Q2 results also follow major restructuring decisions taken earlier in 2026.

During Q1, Mosaic announced the idling of its Araxá and Patrocínio phosphate operations in Brazil, resulting in substantial restructuring and impairment charges. The company recorded a first-quarter net loss of $258 million, compared with net income of $238 million a year earlier. (Mining Weekly)

The Q2 results show that these restructuring actions have not eliminated the broader pressure on the Brazilian fertilizer business.

Instead, Mosaic is now operating in an environment where raw-material economics and production availability are becoming increasingly important.

Stronger Fertilizer Prices Offer Some Relief

There is, however, a positive element in the current market.

Fertilizer prices have strengthened, providing some support for producers.

Mosaic's Q2 results showed that higher prices helped offset some of the negative impact from lower volumes and increased raw-material costs. (AgNavigator.com)

If fertilizer prices remain elevated while sulfur costs stabilize, Mosaic could potentially recover some of the margin pressure experienced during the first half of 2026.

However, continued high sulfur prices could limit the benefit of stronger fertilizer prices.

Implications for Global Fertilizer Supply

Mosaic's Brazilian difficulties are relevant beyond the company itself.

Brazil is a major global agricultural producer and one of the world's largest fertilizer-consuming markets. Any reduction in domestic phosphate production can increase dependence on imported fertilizer.

At the same time, production curtailments in other major markets could tighten global phosphate availability.

This makes sulfur a particularly important market indicator for fertilizer buyers.

If sulfur remains expensive or difficult to source, phosphate producers may continue to reduce output, potentially tightening fertilizer supply and supporting higher prices.

What Fertilizer Buyers Should Watch

Mosaic's results highlight several factors that procurement teams should monitor closely:

• Global sulfur prices and availability

• Phosphate and potash prices

• Brazilian fertilizer imports

• Producer capacity utilization

• Production curtailments

• Freight and logistics costs

• Agricultural demand

• Currency movements

• Geopolitical disruptions

• New fertilizer capacity

The most important takeaway is that fertilizer prices alone do not tell the full story.

A producer can face declining profitability even when fertilizer prices are rising if the cost of critical raw materials increases faster.

Outlook for Mosaic

Mosaic's outlook will depend heavily on whether the current supply and cost pressures begin to ease.

The company has already reduced its 2026 capital expenditure outlook to approximately $1.2 billion, reflecting a more disciplined approach to spending under challenging market conditions. (Q4 Capital)

Management is also positioning the business to benefit from tighter fertilizer supply and potentially stronger pricing.

The key variables for the remainder of 2026 will be sulfur availability, fertilizer prices, production volumes, Brazilian demand, and the performance of Mosaic's North American operations.

Conclusion

Mosaic's second-quarter 2026 loss highlights the growing pressure facing global fertilizer producers.

The company reported a $273 million net loss on $2.82 billion of revenue, but the headline result was influenced by significant non-operating and project-related items. (Q4 Capital)

More importantly, Mosaic Fertilizantes continues to struggle with lower volumes, high sulfur costs, and difficult phosphate-production economics. Although higher fertilizer prices have provided some relief, they have not been sufficient to fully offset the pressure on production costs.

For the fertilizer market, Mosaic's results provide an important warning: the next phase of the market may be driven less by demand and more by the availability and affordability of critical raw materials such as sulfur.

If those constraints persist, production curtailments could continue to reshape global phosphate supply and influence fertilizer pricing through the remainder of 2026.