Mosaic is in the midst of transforming its entire business to maximize its operating and financial efficiency so it can be as globally competitive as possible. To sustain our business, each employee is encouraged to move beyond simply seeing opportunities to capturing them.
This is a new era of accountability, of ownership, of aggressive competition—and we are shifting our culture around the globe to deliver on the promise we are creating.Joc O'Rourke – President & CEO
Old pipes and flanges in Florida were usually sold for scrap. Employees are now assessing them for recovery and reuse, saving money and reducing waste. What remains is separated by condition and sold. Capturing this opportunity has allowed Mosaic to recoup double the scrap price and reduce waste by approximately 100,000 pounds per year. Similar efforts to recover assets and make more efficient use of our resources are underway across the company. Similar efforts to recover assets and make more efficient use of our resources are underway across the company.
Mosaic reached the difficult decision in 2017 to idle our Plant City, Florida, phosphate processing plant for at least one year. Plant City is Mosaic’s highest cost facility in Florida, and idling it should allow us to increase our overall Phosphates gross margin rate and reduce our overall capital requirements. We expect to serve a significant portion of our distribution business and other Indian customers more effectively with phosphate production from our Saudi Arabian joint venture and will focus U.S. production on the North and South American markets where it has logistical advantages.
The acquisition of Vale Fertilizantes marks a transformative point in our company’s growth. The assets we acquired include five Brazilian phosphate rock mines, four chemical plants, a potash mine in Brazil, an additional 40 percent economic interest in the Miski Mayo phosphate mine in Peru, and a potash project in Kronau, Saskatchewan. The assets in Brazil provide an immediate delivered-cost advantage by eliminating the expense to ship phosphate fertilizer from Brazil’s ports to its croplands covering 65.4 million hectares. The controlling interest in the Miski Mayo mine improves our competitiveness with more raw product and greater phosphate rock processing flexibility at our operations in Louisiana.
In February 2017 we reached K3’s potash ore body. Within months the K3 team began hoisting and conveying 800 tonnes of development potash per day. Over the next seven years, K3 will transform into the largest and one of the most competitive underground potash mines in the world—capable of moving 19 million tonnes of potash a year.
Ramping up K3 included lowering a fully assembled, 60-ton chassis for a drum miner. The size and scope of this effort represented an industry-first in Saskatchewan and decreased the time to assemble the drum miner equipment from 28 to 4 days. The K3 team will lower three more three-drum miners in 2018.
Mosaic’s geographic diversity puts it closer to the world’s most promising agricultural areas, including Asia and the Americas. In 2017 the first product–more than 29,000 tonnes of DAP fertilizer–was sold and shipped from Mosaic’s Ma’aden Wa’Ad al Shamal Phosphate Company (MWSPC) joint venture in Saudi Arabia to customers in India. This joint venture provides low-cost production, a new source of phosphate rock, and strategic access to farmers in India and other parts of Asia. MWSPC is expected to produce up to 3 million tonnes of DAP, MAP and NPK fertilizers per year.
Liquid ammonia, or anhydrous ammonia, is an essential raw material in the production of a wide range of fertilizers, including Mosaic’s monoammonium phosphate (MAP), diammonium phosphate (DAP) and MicroEssentials® products. To sustainably and reliably source the ammonia needed to produce products at our Florida operations sites and remain competitive in the global market, Mosaic commissioned and in 2017 christened the new Abundance and Harvest articulated tug-barge (ATB) unit. The ATB is operated by an affiliate of Savage Companies and is time chartered by Tampa Port Services, LLC, a Mosaic subsidiary. The 508-foot-hull Harvest barge has four cargo tanks, each capable of holding 5,500 tons of liquid ammonia refrigerated at minus 27 degrees Fahrenheit. The Harvest is the first vessel built to meet all the requirements of the latest safety and environmental rules for transporting liquid ammonia.
As signatories to the United Nations Global Compact, we uphold the elimination of discrimination in respect of employment and occupation. We believe a diverse and inclusive workforce is necessary to sustainably grow our business and strengthen our communities. In Canada, we are focused on executing our Indigenous Engagement Strategy which includes increasing our Indigenous representation to 15 percent by 2025 in three pillar areas: Community Investment, Workforce Representation and Procurement.
In 2017, more than 80 percent of employees participated in a companywide Engagement Survey. Our engagement score was 74 percent, which means a majority of employees recommend Mosaic as a great place to work, are proud to work for Mosaic, rarely think about looking for a new job with another company, and are satisfied with Mosaic as a place to work. Employee feedback is guiding site-by-site actions and providing valuable context for our transformation efforts.
Our approach to sustainability reflects our commitments to global food security, the environment, our people, the communities where we operate, and our company. We encourage each person at Mosaic to act responsibly and contribute to our company’s success. It is our collective decisions and actions that must be ethical, strategic and sustainable.
Sustainability leadership begins with our Board of Directors. The Environmental Health, Safety and Sustainable Development (EHSS) Committee of the Mosaic Board of Directors provides oversight of our environmental, health, safety, and sustainable development strategic vision and performance.
The Mosaic Company Senior Leadership Team (SLT), led by our President and Chief Executive Officer, is primarily responsible for managing profit and loss and delivering growth. Implementation and delivery of Mosaic’s business strategy and plan are monitored by SLT members. The SLT is supported in matters of sustainability by leading vice president- and director-level employees who are accountable for ensuring the goals are achieved through site-specific, business segment and companywide implementation.
Mosaic participates in a number of voluntary sustainability initiatives:
In 2017 we earned recognition for our sustainability disclosure and performance practices, including being named to CDP A List for Climate Leadership and, for the eighth consecutive year, receiving recognition on Corporate Responsibility Magazine’s 100 Best Corporate Citizens list.