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 IMC FOCUSES ON CONTINUOUS IMPROVEMENT AND GROWING MARKETS July/August 2003
AM: How did the fertilizer industry, specifically IMC, fare during spring planting season? SH: We had a strong early season in the first quarter. Cool temperatures and relatively dry soils in many parts of the Corn Belt allowed some growers to apply fertilizer early. However, since early April, continued cool temperatures and wet soils put planting behind schedule and stretched out the season. Because of this, some product simply wasn't applied. In addition, high nitrogen prices tended to take a larger portion of the grower's spending, which reduced phosphate and potash sales. So, while the industry was projecting a 2 to 4 percent increase in fertilizer sales, the result is a market that is down a little. AM: What are IMC's short-term challenges and goals regarding the world fertilizer situation? SH: Balancing supply and demand is an ongoing challenge in the fertilizer industry. For example, imports by China have been lower than expected, particularly when related to existing capacity. And, we continue to experience flat U.S. demand for fertilizer, though we anticipated higher usage due to more corn acres and higher corn prices. Finally, higher energy prices, resulting in higher raw material prices for ammonia, plus rising prices in sulfur have made it difficult to maintain margins in the fertilizer business. The goal of IMC has always been to maintain its status as a world-class fertilizer producer and as the low-cost producer of phosphate and potash fertilizer products. But beyond that, we are looking to enhance growing market potential in many areas throughout the world. AM: The United States is a mature fertilizer market. What new markets is IMC focusing on to increase value? SH: IMC is looking at a number of market opportunities, both within the United States and around the world, in order to increase value. Yes, in many ways, the U.S. fertilizer market is considered mature. However, we feel there are still growth opportunities within this segment. National soil test summaries show that U.S. farmers over the past 10 years have drawn down their soil reserves, effectively mining their soils of phosphorus and potassium. IMC has aggressively addressed this issue through our Back-to-Basics broad-based educational initiative. If farmers are going to be profitable, it is critical they fertilize properly for quality, high-yielding crops. IMC continues to explore and support efforts to develop new overseas markets. China has been and will continue to be a major market opportunity for IMC. And a number of promising opportunities remain in Asia and Latin America. AM: How has the adoption of Six Sigma improved customer relationships and company strategy? SH: Six Sigma has helped IMC achieve more than $8 million in savings in 2002 through more than 60 projects. This continuous improvement process raises quality, benefits customer service, streamlines operations and offers financial gains, not just saved expenses. In addition, the culture at IMC is changing to become more fact-based and data-driven. In turn, important decisions are now being made based upon this data. AM: What is IMC's view of the Core 4 approach to environmental stewardship? SH: Core 4 is a commonsense approach to improving farm profitability, while addressing environmental concerns. By using conservation tillage, crop nutrient management, weed and pest management and conservation buffers, growers can address 80 percent or more of the environmental issues they face today. Sustainable soils are critical to long-term productivity. When properly planned and applied, the Core 4 approach can improve long-term soil productivity. In addition, by sharpening management skills and utilizing the latest appropriate technologies, one can achieve higher levels of economic efficiency and cropland productivity with the Core 4 approach. With this method, agriculture can help protect and improve water quality, which is important for all of us. AM Tweet |
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