Mosaic's Phosphate Recovery Likely to Take Time Despite Cost Cuts, RBC Says

12:07 PM EST, 11/09/2026 (MT Newswires) -- Mosaic (MOS) faces continued uncertainty in the near term, with a recovery in the phosphate market likely taking some time, while cost-cutting and lower capital spending should support moderate cash generation in 2027 and 2028, RBC Capital Markets said. Unfavorable affordability continues to limit demand and price upside in the phosphate market, while high sulfur and ammonia costs are hurting margins. Lower input costs will largely depend on developments in the US-Iran war and the reopening of the Strait of Hormuz, the investment firm said in a Sunday note. Mosaic's phosphate segment should start to stabilize in Q4 as sulfur costs ease and its facilities settle into the current operating dynamic. RBC said the company has indicated it will take a measured approach to fully restarting idled operations, and the analysts model the restart to occur in Q2 2027. The investment firm said they were "encouraged" by Mosaic's actions to reduce costs while riding out phosphate volatility, with 2026 capital expenditures cut to $1.2 billion from $1.5 billion and 2027 capital expenditures targeted at less than $1 billion. The company is also targeting 2027 selling, general and administrative expenses of less than $500 million, down from $534 million in 2025. With these moves, the analysts forecast the company returning to positive free cash flow of $500 million in both 2027 and 2028. RBC reiterated its sector-perform rating and cut its price target to $23 from $25 on Mosaic. The company's shares were up 2.3% in Monday afternoon trading. Price: 22.88, Change: +0.52, Percent Change: +2.30