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Non-Tech : Income Investing
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To: research1234 who wrote (49127)1/18/2023 5:01:22 PM
From: Elroy1 Recommendation

Recommended By
Area51

   of 51904
 
Re: Ok, for anyone interested in Income Investing, I''m curious why you WOU

I would not be at all surprised if the price is $50 a year from now.

Well, during 2016-2020 when the fertilizer industry was in the super dumps, AND UAN had $645m debt with a 9.25% interest rate, UAN bottomed out (for the entire four years) at about $28-$35. During this period UAN paid almost zero distributions.

With a better debt position now, I would guess the UAN unit price bottom (jn a horrible fertilizer environment) could be higher, maybe $45-$50.

Sure, it's possible fertilizer prices collapse toward the 2016-2020 lows. But.....why would they? There's almost zero new fertilizer supply coming on line in the US recently, so it's not really clear what would push UAN fertilizer prices below $150/ton (my guess at where UAN would distribute zero for the year). UAN fertilizer in the regions served by UAM the MLP now is about $500/ton. Corn price is high. What might cause fertilizer prices to fall by 2/3rds? I don't know.
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