Tony Will: But I think the other important thing, Andrew, that I wanted to just highlight here and you mentioned it. If you think about from a natural gas cost differential, the difference between the cost of production in the U.S. versus the cost of production in Europe right now and even on the forward curve, is about $400 to $500 spread. So whether we’re talking about ammonia or whether we’re talking about urea, whether we’re talking about UAN, North American production network has a huge economic advantage. And that’s one of the reasons we’re so happy where our plants are located.
Andrew Wong: That’s great. Thank you very much.
Operator: And our next question will come from Ben Theurer with Barclays. Please go ahead.
Benjamin Theurer: Yes, good morning and thank you very much for taking my question. I wanted to go back to some of the demand expectations you’ve talked about and particularly the gap of imports or what you expect at least for Brazil and India. We’ve seen a lot of like peers in the industry talking about just the softness in Brazil and the more spontaneous buying as you go as you need kind of purchases. What’s your level of confidence as it relates to this demand for the imports and what you flagged in the 3 million to 4 million ton range just in the fourth quarter to basically wrap this up. And then obviously, similar to India because it’s also a very sizable number. So just about the level of confidence you’re having for this demand?
Bert Frost: Yes, so when you look at Brazil, the substantial growth in Brazilian agriculture is amazing over the last 20 years, going from an exporter of soybeans and corn to a major #1 position for soybeans and corn in a subsequent or a parallel increase in fertilizer demand going from 2000, let’s say, 23 years ago, 16 million tons to today 44 million tons. Well, what does it take to bring that in when you’re only producing a little bit of phosphate, that means all the potash, most of the nitrogen and almost all of the phosphate as well needs to be imported. And what does that look like when you have just a few ports, Paranagua and Santos and some of the others that are congested. And so you have lineups that it’s expensive to have demurrage.
So when you calculate the movements of products, why we have confidence is the acres will be planted. That will be fertilized, the profitability for especially a pharma for second crop corn, even factoring in 100 bushels per acre is positive. And that’s basically a cover crop for them. So that is at minimum, an application of urea. So when you look at our expectation of 7.5 million tons more or less for an annualized basis of Urea for Brazil, and where they are today, that import will last through February. So we’ve got November, December, January, February, four months at around 700,000 tons more or less per month and the demand is there. So we expect to see that, and it’s pretty consistent over the last several years, again, consistent with our growth and production of feed grains and oil seeds.
In India, we’ve seen a different dynamic with the construction of the plants that have taken place with the Modi government Build and Buy India program that, that production has gone up to close to 30 million tons of the 36 million, 37 million tons of demand. So our expectation is more or less 7 million tons. That’s off of the 9 million to 10 million tons of imports over the previous few years, but still sizable. That puts India well, now put Brazil as the #1 importing country, India #2 and United States or North America region #3. And again, those numbers are trending exactly that way.
