"A smart move from Incitec Pivot, as they can now focus on better performing parts of the business." Guess where this came from?
The only reasonable decision that could be made by IPL. I would not want a loss making part of the company destroy the whole. Get rid of it now. IPL, IMO, should not ever consider manufacturing Urea in the future.
Take a look at the LNG netback price chart on the ACCC site. Things didn't look too bad at the end of 2019. Then look at what happened from then on, including a forecast to end of 2023. I don't know that it is a hanging offence, but the board's forecast regarding future gas prices left a hell of a lot to be desired.
I would think that there will be very little new urea being produced in Australia in the next 4-5 years. IPL can now source it from wherever at the going price, and then mix, blend, coat, green it up a bit, and distribute it through its extensive network. The poor farmer will just have to cop it sweet.
IPL is currently in the carbon reduction spotlight, and it is time it got on the band wagon. Spare a thought for ORG and AGL.
I look forward to further discussing this mater. J L.
IPL Price at posting:
$3.13 Sentiment: None Disclosure: Held
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