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Non-Tech : UAN - The variable distribution MLP that could go a long way
UAN 76.26-1.6%4:00 PM EST

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To: Area51 who wrote (283)10/19/2021 3:01:53 PM
From: Elroy  Read Replies (1) of 320
 
I think Publius has a tendency to over estimate how good things may be.

There are always lots of moving factors in any quarter. We don't know what new "one time" charges and reversals will occur. It's also possible the plant had a company specific problem, and shut down for a month. We really don't know.

Based on conversations I've heard of with management, they don't seem to do "strategic sales/profit maximization strategies" such as holding back product for higher prices in the future. Management has indicated that the timing of sales is up to their customers. When the customers want to buy, they sell, and the spot price (for near term delivery) or at the CME NOLA futures price + delivery savings for future delivery.

The past six years fertilizer industry has been a buyer's market. That's obviously changed this year to very much a seller's market, so it would be nice if they adjust their strategies a bit to maximize profits somehow.

In addition to the Q3 results and distribution, I hope they give some indication that they didn't begin selling H1 2022 deliveries until recently. In other words, I hope they didn't sell out much of their H1 2022 production two months ago at prices which were then 40% below the level of current futures price.
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