RBC Downgrades Mosaic On Flat Demand, Higher Costs

Mosaic Co.'s (NYSE: MOS) flat demand for its fertilizer coupled with rising costs for production materials resulted in at least one analyst's downgrade Tuesday.The Plymouth, Minn., phosphate mining and production company is paying more for the ammonia and sulphur required to covert its raw materials into fertilizers.The higher cost, plus an outlook for lower crop prices, prompted RBC's Andrew D. Wong to trim $0.15 cents a share from his 2015 earnings estimate and downgrade the company to Sector Perform, from Outperform.Wong also reduced his 5015 sales volume forecast to 8.3 million tonnes, from8.5 million tonnes although he expects prices will rise about 1 percent.Lower global crop prices and weakness in India will offset stable prices and historically high amounts of crop acreage -- spelling flat demand in the year ahead, Wong said.Despite "near-term market headwinds" Wong said his long-term positive view of Mosaic hasn't changed. "It's under appreciated," Wong said, cutting his price target to $51 a share, from $55.Mosaic shares were down 2 percent Tuesday afternoon at $46.21.