As the world’s largest agricultural input supplier, Nutrien (Toronto Stock Exchange: NTR) plays a pivotal role in the fertilizer industry. The Canadian giant provides key agricultural inputs like potash and nitrogen fertilizers, and its stock performance is often regarded as a barometer for the entire agricultural materials sector. However, over the past two years, Nutrien’s stock price underwent a sharp decline, falling by 35% due to fluctuations in fertilizer prices.
Heading into 2025, as the supply-demand dynamics in the sector improve, investors are examining whether this fertilizer leader is poised for a turnaround.
Nutrien faced significant challenges in 2024, as shown in its latest financial report. The company’s annual revenue fell 11% year-over-year to CAD 26 billion, and fourth-quarter net profit plummeted by 45%, landing at CAD 700 million. Declining prices for its core products, potash and nitrogen fertilizers, were the primary culprits, leading to a 12% drop in adjusted EBITDA, which came to CAD 5.4 billion.
However, such cyclical fluctuations are common in the fertilizer industry, and during a recent earnings call, management emphasized that price downturns often pave the way for the next rebound.
The turning point appeared in early 2025. As major competitors announced production cuts amid recovering demand, potash prices rebounded, boosting Nutrien’s stock price by 12% year-to-date, outperforming the Toronto Stock Exchange benchmark index. Analysts highlighted that as the world’s largest potash producer, Nutrien’s stock tends to exhibit significant leverage during cyclical price recoveries.
Despite these recovery signals, investors should still be cautious about potential risks.
One area of concern is Nutrien’s dividend sustainability. While the current dividend yield exceeds 4%, the payout ratio has reached cautionary levels. Should earnings fail to improve as expected in 2025, the company may face pressure to adjust its dividend policy.
That said, Nutrien’s retail business—which provides farmers with seeds, pesticides, and digital agriculture services—has demonstrated strong resilience to cyclical fluctuations. Management also expects rising fertilizer volumes, higher prices, and improved margins to fuel profit growth in this segment.
All eyes are on the company’s 2025 Q1 earnings report, set to be released on May 14. If the upward trend in potash prices and improving market dynamics translate into tangible performance gains, Nutrien’s stock could have further room to rise. However, weaker-than-expected results may cause the stock to pause its rally, awaiting the next earnings release.
For long-term investors, Nutrien remains a core play under the theme of global food security. Structural factors like global population growth, increasing climate volatility, and expanding demand for biofuels continue to underpin agricultural materials demand. While short-term fluctuations are inevitable, Nutrien’s integrated supply chain and robust cost-control capabilities give it a strong competitive moat.
