All right, let's continue on here with our next fireside chat. It's going to be from Nutrien, the world's largest fertilizer producer, owns a large farm center business, very influential in potash and nitrogen. We're happy to welcome the CFO of the company, Mark Thompson. Mark, why don't we kick off with maybe a State of the Union, talk about what's going on at Nutrien, then we'll get into Q&A. We'd love for people to participate by submitting questions on the app. Thanks.
It's good. Yeah, thanks, Joel. Good to see you. Thanks for having us, as always.
You're back from Monte Carlo, right? Did you go to Monte Carlo, the IFA conference?
There was an IFA conference in Europe that I just got back from.
Talk about that.
Yeah, we can. Yeah, we're sitting here today, halfway through May. I'd say, generally speaking, our outlook is very constructive on 2025 and what we're seeing. We're sitting here in the middle of the North American spring season, looking to plant about 95 million acres of corn in the U.S. We're seeing evidence through April and May that demand for crop inputs is very robust, seeing really strong field activity, as evidenced by planting progress reports coming out of the U.S. We're very encouraged by that. I think behind that, Nutrien is obviously the world's largest fertilizer producer, and we're seeing very constructive supply-demand dynamics across all three nutrients. That's created firming prices across potash, nitrogen, and phosphate.
I think relative to where we sat three to six months ago, looking out at the world today, certainly we're more encouraged and more constructive on that outlook. In the first quarter, we just reported results. We had very strong potash volumes. We ran our ammonia facilities at a record operating rate. We saw the improvements in expense management in the retail business start to show through. I think you step back from what we're seeing in the market today. We've got a set of 2026 performance objectives that we published at our June 2024 Investor Day. We made really strong progress towards those in 2024, evidenced in the first quarter that we're on the right track. That's a big focus for the company.
Ultimately, really driving stronger sources of sustainable cash flow over time, and then being disciplined on cost structure, capital allocation, and making sure that we're taking a very disciplined approach to how that capital is deployed and giving more of that capital back to shareholders over time. I think that's kind of the big picture. I know, as always, you have lots of questions, so maybe we can go there.
Sure. I thought, maybe we will start sort of short-term and work our way out. Retail was disappointing to the market, OK? However, your team was very clear to say weather was not great in Q1. Retail may not, and we know that retail is a very seasonal business. You used to work at Agri; we were talking about this earlier. I mean, Agri needs to get first half and second half your guidance. If weather changes a couple of weeks between March and April, things can change. Maybe talk about that, that retail is a bit weaker in Q1. Do you expect it to be made whole in Q2?
Yeah. Year over year, retail earnings were down in Q1. Again, it's really weather-related and timing-related items. I think North America was the biggest driver of that. As you said, in any given year, if you have favorable weather that finds its way into March, like it did last year, you'll see more of the first half earnings shift from Q2 into Q1. In this particular year, we did not have a lot of field activity in the U.S. in March. We also had some more hot and dry weather in Australia, particularly in southern Australia. I would say in Q1, our retail performance, at least from an internal perspective, was very much what we expected and really has not changed our perspective on the first half. On our earnings call, we mentioned that at that point, we saw really strong field activity through April.
That's continued through May. That very small shortfall relative to consensus expectations that we saw in the retail business in Q1, we would expect to be fully made up in Q2. You step back from all of that, and we look at the full year earnings guide for retail, that's also unchanged. That midpoint of $1.75 billion of EBITDA, which is part of the march towards our 2026 target, is also intact. So far, we're quite encouraged by the level of field activity that we're seeing and all the major drivers there. Again, going back to the 95 million acres of corn that's going to be planted, that will drive strong demand for fertilizers. So far, that's what we're seeing.
Let's talk about that. The spring in North America looks really good, right? You've had a bit of a surge in nitrogen prices. Maybe we're going to cool off because that's what happens. You're talking about 95 million corn acres. Do you believe in that number? Talk about the spring, elaborate more on the spring and how good it looks versus what you thought.
Yeah. Maybe just first, to start at the grower level, I mean, we've seen crop prices improve a little bit versus where we were coming out of the end of last year. Obviously, we'd always like to see growers making as much money as possible. Crop prices could be higher than where they are today. The Midwest Growers, as an example, balance sheets are quite strong and in a good spot. Corn and soybean prices improved from where they were. Margins are probably back to sort of more average levels, depending on where we look. When we look across to the fertilizer complex, really, whether it's any of the three nutrients globally, supply demand has been quite tight. I'd say in North America specifically, since your question's on the spring, you look at nitrogen, maybe to start there.
We came into the spring of 2025 with very low inventories, particularly on urea and UAN. The market did not import enough volumes, combined with some of the supply issues and lack of exports out of China, to get what North America probably needed to plant 95 million acres of corn. We have seen a real squeeze, particularly in UAN, and that has resulted in a further squeeze in urea prices. There is evidence of that in the market right now. Nitrogen is very tight. I think it is a supply issue as much as it is a demand issue. Similar dynamics on phosphate, where, again, supply tightness globally has kept prices at elevated levels. I think on potash, also constructive, but a bit of a different story. Potash has really been a demand-driven story globally. We have not seen as many supply issues in potash.
I think that's actually more encouraging for us. We'd rather see sustainable demand being the driver of price strength in potash. We can look at really any major market across the world right now, whether it's North America, Brazil, Southeast Asia, China, non-contract volume, and demand has been very strong to start the year. Our view of 73 million tons of global shipments is intact. That's really led us to increase the domestic potash price four times since our fill program at the beginning of the year. That's just a reflection.
Last week, you did one last week, right?
We did, yep.
20 bucks?
Yeah, up to $390, Midwest, short ton. That is really just a reflection of the world and North America staying at parity with markets like Brazil. I think across the board, certainly things look constructive in North America. Of course, fill programs will be coming here over the next month, and we will see what those look like. Generally speaking, constructive outlook on the fertilizer side.
Okay, let's break it down. Let's talk a little potash. Okay, demand-driven, right? We're seeing imports up in all markets. China is destocking. I don't know, they're below 2 million corn inventories, strategic reserves being destocked, things we all know. You said it's been demand-driven, not supply-driven. If you asked anybody five months ago, maybe even yourself, we would have thought this year was going to be fueled by a lot of supply cuts, right? Belarusian maintenance maybe hasn't happened. What do you think about that? You just came back from a fertilizer conference. What are people talking about that? The supply side, there were some supply cuts that maybe didn't happen?
Yeah, I think just generally, the big takeaway from the industry conference we were at is just I think there's a sentiment perspective out there that everything that I just said on supply-demand being relatively tight across the nutrients is true. That was definitely, I think, just a prevailing sentiment generally that we heard from presentations that took place. I think in potash specifically, of course, to start the year, we had a series of sort of planned and unplanned maintenance or downtime that were put out in the market publicly by different producers. Some of those, we see evidence of them playing out. Some of them that we do not. We also did expect demand to grow, though. I do not think that's surprising to us that demand is as strong as it is.
We have recovered over the last couple of years back towards trend levels in potash, which has happened time and again over history. Here we are kind of coming back towards trend levels again, which is a healthy indicator. I think on the supply side, through April, based on publicly available data, we do not see evidence in totality of Belarusian tons coming out of the market. It is possible when you look at trade flows that maybe there is a little less white potash going into parts of the world, and that has been made up with other grades of potash. Generally speaking, we do not see that. I would say in April, we can see maybe some of the impact in the import-export data of some of the planned maintenance announcements that were made publicly on Russian capacity. We do see less tons from Chile.
Laotian volume does not look like it is growing substantially. There are some impacts of supply. Again, going back to the point I was making, fundamentally, to see demand at the pace that it is at and inventories not growing amid all that demand is probably the healthiest indicator of more sustainable, tight supply-demand. We are more encouraged by that.
I agree. Demand looks great. I think, was there chatter this week about Belarus, or nobody knows?
Yeah, I don't think anybody.
People were asking questions. It must have been the discussions you were having, people.
Yeah. I mean, I do not think anybody really knows the nature of what is going on. But at the end of the day, I think what people can all attest to is when you look to any of those major markets like we talked about, clearly supply-demand is tight. And if you just look at the latest indicators that we have, North American current prices, we mentioned back to $390 short ton in the Midwest. You look at Brazil, and Brazil has been a slow and steady march higher. You look at the latest price that is being talked about by the publications of what is going to happen with the Pupuk tender, seems like the low offer there is about $360 a ton. And those markets have all been firming. And so I think that is the best indicator of the supply-demand situation being tight.
Right. 360 Southeast Asia, Indonesia, we talked about. I'm not asking you to project when or what the Chinese potash contract will set out, because as you know, that's a death wish, but I mean, publications are talking about. I'll give you some history. I started modeling $320-$325 for China five months ago. That was deemed by some people to be so bullish, you're crazy. Now we're talking about the publication, maybe they'll settle $340-$345 in the next month. I'm not asking you really for a projection, but are you getting the sense that it's getting close to the buying construction, settling contracts, and the pricing out in the trade journals are somewhat order of magnitude right?
Sounds like I should ask you what the price will be. No, I think totally fair question. Obviously, one we get a lot. Obviously, Canpotex and other global suppliers are the ones that negotiate those contracts.
You are Canpotex, Mark. You are Canpotex.
We are a shareholder.
I hate that answer from Mosaic Company. You are Canpotex. Sorry, keep going.
Yes, we are a shareholder of Canpotex.
You are Canpotex.
You step back and you kind of just look at what the fact pattern is globally. We just talked about the Pupuk tender in Southeast Asia getting settled at $360. Directionally, Southeast Asia standard prices are a good indicator of where the market is moving. Brazil, although it is a granular market, tends to be a good proxy for, again, the direction of pricing for these international contracts. Brazil, on a spot basis, is somewhere between $360-$370 today. Call it $365, and all of those prices have been moving north. It is also true that Canpotex announced a couple of months ago that it was completely sold out for the first half and would be selling product now into Q3. I think even were there to be an imminent contract settlement, there would not be product readily available to actually ship right now.
From a Canpotex standpoint, generally speaking, Canpotex is comfortably selling into the third quarter without the need for an international contract. I think you look at the efforts that have been put in place, certainly by Canpotex and the broader business globally to diversify supply outlets. That is pretty staggering that you look at the fact that we are having a record demand year and Canpotex is selling into the third quarter without any international contracts in place. I think all signs point to sort of the firming prices, setting a good stage for those contracts. Like you said, it is pretty perilous to predict when they are going to get signed and what the price will be. We will keep watching too.
I think some of the pushback I had from investors five, six months ago was if things play out versus your projections, just people's projections, this year, 2025, would be a third consecutive year of potash demand growth, which does not really happen. Now, you could argue that this year is going to be a very modest increase, kind of flat, but okay, academically, it is a third year in a row. The question would be, things have been so great, prices are so great, rising, I do not know, $80-$90 a ton in Brazil since last, $80-$90 since last October, a fourth year of consecutive demand growth. Is that possible? I get the academic argument. Trend demand still has to be caught up. Is that the biggest argument, that we are just below trend? A fourth year, as unprecedented as it is, it is a long question, sir.
Is it possible?
Yeah, I mean, I think you touched on some of the key indicators you'd be looking at. Again, we sort of talk about healthy markets and healthy demand. I mean, healthy demand is where you're not stocking up or destocking. It's where you're consuming potash at the same rate that you're buying it. I think the biggest indicators of health that we're watching right now, and you touched on some of them earlier, are that's great. We are seeing demand growth for potentially three years in a row, at least at this point in the year. As you mentioned, it's not a 2.5% growth rate year- ove- year that we're projecting right now. Last year, we ended somewhere around 72.5 million tons. The midpoint of our guidance this year is 73.
That would actually be below that historical average year of yearly growth rate that we've seen. I mean, one of the key indicators that we saw through the last cycle was price. Another key indicator was inventory. When we had those years of pullbacks, if you were to compare this to, say, 21 or 22, there are some pretty important differences. I mean, one being the price went from a relatively low level to above $1,000 a ton within roughly a 12 to 18-month period, which created panic buying. We're not seeing anything like that today. Prices are at exceptionally affordable levels, especially relative to the other nutrients. We're not seeing inventories building in key markets. In fact, we're seeing destocking in some of the important markets like China, you already touched on. Indian inventories are being drawn down.
Behavior in North America and Brazil looks relatively normal. I think those are the key indicators that we'll keep watching. If we were to cast forward to the year, certainly the pace of demand that we've seen through the first half of the year looks like it's at 73 million tons run rate or slightly better. I think when we get into August and report our Q2 earnings, we'll have a better perspective with more time behind us to have a better view on where global shipments end this year. Is four years possible? If all those indicators are healthy, sure, I think it's possible.
You're going to produce this year and sell plus or minus 14 million tons of potash. You obviously have way more steel in the ground, but it's your resourcing that you have. If we were to get into 2026 and things are even better and we could see the world grow another 7 million tons where you need those extra tons, how long would it take Nutrien to staff up? And would you do that on a one-year, I don't know how to explain it, maybe potentially a one-year spike?
Yeah. So typically, a couple of, and you know this, Joel, the way that we think about running the business is from a commercial perspective. Over time, we've kind of been between 19% and 20% of global shipments from a share perspective. That's held true across a variety of market conditions. If you look back since the merger, even in the really extreme market conditions we've seen, sort of 18% in the lowest case, 21% in the highest case. They really do not move around that much. This year, if you look at 14 million tons of Nutrien midpoint of sales volume guidance versus 73 million tons of global shipments, kind of in that low 19% range. Typically, we approach the year in a way where we'll staff the operations to be able to hit the high end of our sales volume guidance range.
We have staffed our operations this year to be able to get to 14.4 million tons if the market warrants that. The types of circumstances that would warrant that is if, again, we are seeing global demand at a pace that takes us closer to the 75 than the 73. We continue to see these isolated supply issues. That would be something that would cause us to say sales volumes maybe move beyond the midpoint and towards our high end. I would not see us staffing to levels that would be much beyond that in a year like this. That is sort of the approach we have taken over time.
In terms of steel in the ground kind of today invested, it would be in and around that 15 million tons of capacity if we started planning our year to that and saw global shipments at that level and it aligned with our typical share. We have the invested capability that if global demand continues to grow, we could get up to those levels. Beyond that, from a Nutrien perspective, we said this in the past, if we were so inclined and started to see that continued global demand growth over the next number of years, we still do have a variety of smaller projects at our operations, probably 3 million tons in total that are very small and ratable. They are in that kind of $200 per ton plus range.
We are not deploying capital to those today because we are looking at the pace of global demand, and we think it is optimal to give the capital back to shareholders or invest it in near-term returning, high-yielding projects.
What do you think's really driving the Chinese potash inventory drawdown? I mean, they're getting way more tons via rail, via from Uralkali, and Belarus. Belarus will be BC now. What do you think's really led them to? They're ramping up their salt lake production. I mean, what's really getting them to the situation?
Yeah. I mean, we obviously do not know all the factors that are at play because we are not there. I think more generally, if you look across the fertilizer and agriculture complex in China, you do see the consistent theme of prioritization of domestic food security and agriculture policy. I mean, this week, there has been a lot of speculation about what Chinese urea export policy is going to look like. There has been talk of what Chinese phosphate export policy is going to look like. Throughout all those policy declarations, there is a consistent theme of making sure the country has enough fertilizer to sustain local agricultural needs. I do think over the last couple of years, we have seen a step change not only in how they are approaching the grains and oilseeds imports and production, but also making sure there is optimal use of fertilizers.
Potash has gone through a step change where we were kind of trending between 12 and 15 million tons of consumption for a few years, and that looks like it's moved into the 17-19 million ton range. Against that backdrop, however, there's declining domestic production. We saw it peak out closer to 8 million tons a few years ago. Sort of 6.5-7 is more of what looks realistic today and probably declining over time. Laotian production has obviously been slower and has not ramped up as quickly or been as large as thought of. Clearly, that's a potential supplier to China. I think we just moved through spring season in China. There's obviously still a need for imports. I think all of those things are driving the sustainably higher level of demand.
When you're consuming potash at 18 million tons a year, which is our estimate for China currently, you're consuming quite a bit of potash every month. Imports, in our opinion, will be important at some point in 2025. We'll see when the contracts get settled.
Look, Jansen is a couple of years away. If you believe the numbers, it'll be about 1 million tons of production from there in 2027, 4 million by 2029. When do you start thinking about that in your strategic planning, in your personnel retainment? Is that a word, retainment? Retaining personnel, you know?
Yeah. I mean, we're always thoughtful about retaining personnel. I mean, the project or some form of the work in the project has been going on for the last 17 years. This is something that we've been thinking about over time, certainly in terms of how we run the business. I think if you step back and think about where we started the discussion on potash, the most important feature of the market here is demand and the continued sustainable demand growth. We sit here this year. Right now, we're looking at a midpoint of global shipments estimates to 73 million tons. We cast that forward at a historical demand growth rate at the end of the decade. We could see 80-85 million tons. At a midpoint, 9-10 million tons of incremental demand growth.
If you look at what's available in the market today, I just mentioned that Nutrien from our midpoint this year has about 1 million tons. We see maybe 3-4 million tons of supply in the FSU that's possible from brownfield additions or ramp-ups. Maybe there's 1-2 million in Laos, but beyond that, there's not a lot to speak of. Yeah, we've seen the public announcements on the ramp-up curve from BHP. We've done a lot of these projects. I mean, you've followed this industry for a long time. Ramp-up curves do not always tend to go perfectly. We think you probably see the first 4 million tons for the first time in the year '29 or '30, and arguably the market might need the tons by then.
Some tons in '27. One thing I'd say of BHP is they have not delayed their timing for a couple of years. That's the one thing I'd say. You know what I mean? They've been consistent. It doesn't mean it's going to change. I mean, if you thought there's going to be a million tons coming out of Jansen in 27, I don't know, 2 in 2028 and 4 in 2029, when do you start to have to plan for that?
Yeah. Look, I mean, I think you step back and you think about the way we plan the business. This business has been about long-term growth with customers and, again, a very consistent approach to our commercial execution through all kinds of market conditions. I do not actually think it changes a lot. Our goal has always been be the low-cost producer, be bottom left of the cost curve. Whether you look at our targets around cash cost of production, automation in the mines, being really thoughtful about how we are controlling costs and capital, all that stays the same and positions us well. Looking at how we work with long-term customers and the domestic integration of our supply chain with the downstream retail business and having security of supply throughout all kinds of market conditions, we have been doing all of that.
I mean, I think one of the things we often hear from customers that is a big feature of our network is we've got a six-mine network. We've got a lot of shafts. We've got a lot of logistics capability. We have multiple export terminals. Again, our investments in logistics infrastructure to be able to tap all of these markets around the world is something that I really think sets us apart. I don't think there's actually something that Nutrien would do differently. Of course, it's just being thoughtful about how we execute on all those things in the years ahead here.
Fair enough. Let's talk about nitrogen. So we've seen nitrogen fertilizer prices quite strong. Ammonia has been a bit weaker, but it's holding on in the States. I mean, where are we in nitrogen versus what you would have thought a few months ago?
Yeah. I mean, I think if you look, and we had some good graphs we put in our Q1 release around fertilizer year inventories heading into North American spring. Obviously, we came into the North American spring net short of nitrogen, and North America is a net importer of nitrogen. We came in needing to attract more imports, and that did not happen. I think the market got caught a bit by surprise, probably on some of the price action and commodities on how strong planted acreage intentions were on corn. When we got to that point, it is almost too late sometimes to actually bring in the nitrogen that is needed. I think in the case of UAN, I would almost call it, it is not just tight, it is actually short. There just have been situations where UAN is not available in some parts of the U.S.
As a result, that's caused some switching to urea. Urea has become exceptionally tight. We can see that in the pricing dynamic in urea and UAN. As we approach kind of the post-spring peak demand, you look at the prompt values for NOLA today versus what's in the paper market for June, some indication of a potential reset, which would be normal. With the announcement from the Chinese, again, seems to be indicating that there'll be a quota of some kind. Today, the talk is 2 million tons through October, pardon me. That would be in line with our projections of 1.5-3 million tons in 2025. We would expect that keeps the market tight. We've had a relatively constructive outlook for nitrogen, and it's still constructive.
On the ammonia side, again, we've seen prices come off versus the very strong levels that we saw in Q4. I think that's a combination. The global ammonia values tend to track TTF gas relatively closely over time. It's come off a little bit from its higher levels a few months ago. Industrial demand in parts of the world has been weaker, and we've had Gulf Coast ammonia ramp up in the U.S. Again, we would expect a bit of seasonal strength in ammonia, and then combined with just the market digesting GCA and potentially some more constructive fundamentals as we head into the end of the year. I think you step back from that across the nitrogen complex, urea and UAN would be above what we consider mid-cycle values today, ammonia somewhat below, but nitrogen, again, in a very constructive place.
Let's talk about retail. This year was interesting because if you go by your guidance, you're expecting only about a $50 million retail increase this year. That was because the back half of last year ended up being stronger than you thought. Fair enough?
Yeah. I think there's two things when you look at the headline guide, which we've talked about before. If you sort of look at headline basis, $1.75 billion midpoint in 2025 versus a headline $1.7 billion to end 2024. When we normalize for FX and we strip out some of the non-recurring benefits that occurred in 2024, we would see that more as $125 million year-over-year growth, which would be sort of a typical run rate for us. But look, when we step back and we think about our retail guidance, we continue to anchor investors and think about the world in terms of what does that midpoint at $1.75 billion assume about the retail business. So there's a couple of really important key drivers in there. At the midpoint, on a year-over-year basis, we assume sort of 4-5% fertilizer volume growth across the business.
We assume that Brazil moves towards a break-even EBITDA and cash flow state in 2025. We assume about $100 million, roughly, of gross profit growth from proprietary products year-over-year. We also assume that there is some reversion of crop protection margin percentage back to more of a historical average. You could approximately say about 200 basis points weaker than last year, which would be more in line with history, just based on some of the competitive pressures we are seeing. We continue to see the benefits of expense management. That kind of characterizes the world, generally speaking, at the midpoint of our retail guide. To the extent that those factors are better, that would push us into the upper half. The opposite is also true. I would say, based on what we can see today, things are playing out roughly in line with that midpoint case.
You're going to have to, you're getting close to where you're going to have to update on 2026 retail guidance that you've had for a while. Midpoint $2 billion, but as Jeff will say, it's $1.9-$2.1 . Let's bridge from $1.75 billion. How do you get $150 million more next year to get to the bottom of the range? How do you get $250 million more to get to the midpoint of the range?
Yeah, I think it's many of the same.
It's been 350 the time, but let's get 150 and 250 at least.
Yeah. Maybe I just talked about internal factors. I think for the sake of completeness, obviously, these factors are not entirely independent of market conditions. I think if we're staring at $4 corn versus $6 corn, you're going to live in a different world in terms of the potential revenue opportunity that a grower has and how they think about crop input purchases and what they're going to spend on the crop. That obviously is going to have a bearing potentially on the overall market dynamic and where we end, as is affordability and several other factors. The external environment will matter. I think that's an important determinant of where you end up relative to that range. I think I go back to those factors that I just talked about.
I mean, you could sort of just say those same factors continue to be important. Proprietary gross profit growing towards that $1.4 billion of GP is a primary factor around our assumptions. We would assume that Brazil is better than break-even, moderately better than break-even in that case. We would assume continued fertilizer volume growth in that 2026 case. There is expense management continuing to be built into that case as well. We continue to focus on those drivers along with optimizing our network, closing redundant locations. Yeah, I would say that while we're continuing to look at tuck-in acquisitions in the US to a lesser degree in Australia, as we always do, that's not a major feature of that growth case. It's really those other drivers that I talked about.
You bought a couple of stores in Q1, right?
We did. Yeah. We did two acquisitions in Q1, both in the U.S. The larger of the two was a larger distributor in the Midwest called Welch Ag, business we've been watching for a long time. The economics look quite good. Typical sort of headline purchase price in line with what we're used to seeing. We say kind of 6-7 for a high-quality, medium-sized business. We could take one to two turns of synergies out of that. From a capital allocation standpoint, we've been really clear with investors, really clear with shareholders that that incremental dollar beyond CapEx, lease capital, the dividend is really going to go to ratable share of purchases and tuck-in acquisitions. Not a major deployment of capital on tuck-ins, but it'll continue to feature as part of the capital allocation priorities.
Just on the retail business real quickly, if I think of the seed technology, proprietary seeds, DynaGrow, a lot of things go in seeds. You've got predominantly one provider, a major provider for your germplasm for DynaGrow. Have you looked at double sourcing that to a broader view? There's gene editing coming out. Have you looked at other upstart players playing around with that? Where are you on the, where are you on sort of status quo versus seeing what else? Am I making sense?
Yeah, you do.
I can't finish this question. I can't land it. I think you got it.
I know you so well. I speak Joel.
I can't land it. It's like the delta. It's upside down. I got upside down.
Yeah, there you go. Yeah, look, I think first and foremost, you go back to the proprietary product strategy of Nutrien. The reason we're able to build and grow proprietary products organically is really because of the breadth of the retail network that we've built, the relationship with the grower, 20+% market share in the U.S. It's really the strength of that distribution and being a large customer with our suppliers that allows us to partner in the way that we do and have these proprietary products businesses. On seed, we do have optionality, and we work with all of our suppliers to understand where we can be a good partner, where there's margin opportunity to serve a customer and a grower by bringing different seed technologies or germplasm to bear.
Today, we play in some secondary crops, and then we private label in some of the major crops. That is something that will continue to be a part of the strategy. When I step back from that and I think about materiality and proprietary overall, though, I think where we are really focused, which speaks to that 2026 target of the $1.4 billion in GP, is on the specialty nutrition side. That is an area where you have got 5%-10% organic underlying growth rates. We have got differentiated technology from acquisitions we have made over time. We have got the market position to organically grow and penetrate more in that business. We have got the largest global share of biostimulants at about 5%. Of the two or three shelves, that seed, nutrition, crop protection, I think nutrition offers us the biggest opportunity.
If I put that together, sure, there's some stuff in seeds, but you're kind of happy with what you have and where you think the real difference maker is to push out specialties in nutrition, fertilizer, things like that.
Yeah, I think that's right.
Okay. Okay. Let me ask for the last five minutes we have left. Okay. If we think about, so if we think about where you were, where we all were a few months ago, would you say, if you think of the 2025 kind of earnings indicators versus a few months ago, would you say things are shaping up better or worse than a few months ago?
Yeah, better. Yeah. I think you've asked us this, and I think it's a totally reasonable question.
On the public conference.
It did. Yeah. I mean, it's actually, I think, a really simple way to crystallize what we've seen take place over the past couple of months. Certainly the answer is better. That really is on the fertilizer fundamental side. I mean, that tightening we saw in North American nitrogen fundamentals, the trade flow issues, supply issues, combined with really healthy demand in North America, have really firmed up fundamentals for nitrogen and kept them firm in phosphate.
I think where we've really seen the step change evolve in potash, which again, I would say is different than in nitrogen and phosphate, is just that strength of underlying global demand to start the year in potash and how robust that's been, even in the absence of some of these potential issues that the market might have expected would be there in supply that you called out earlier that have not materialized. You look back at kind of this slow, steady, more sustainable margin fundamentals for the potash business, and we're encouraged by that. I think if you look at where we entered the year, I do not think the market or sort of the broader investor community overall, and maybe not even Nutrien would have expected, we'd see all these things in confluence, and we have.
Certainly it is more constructive than when we were at the beginning of the year.
When you restarted back the buyback sometime in September, I think it was about the same day you were part of our Agapalooza event. Remember that in Chicago? Remember that? The buyback started that day, coincidentally. Remember that? Anyways, since that buyback restarted, you've done a good job to attack it. You have a new buyback now that always kicks in around March 1, give or take. Talk about the buyback, the importance of it versus all the things you're talking about, including some retail tokens.
Yeah. I think, again, you step back, you think about all the things we're doing. I think I have to answer this question by starting on sources of cash maximization. You step back and you look at the things we've been doing to actually create more sustainable sources of cash, both recurring and one-time. We've continued to drive towards those 2026 performance target, which is the largest underlying driver of growth in cash flow from operations over time, fertilizer volume growth, expense takeout, growth in downstream retail earnings. Those are important things we're focused on. We've been continuing to rationalize the portfolio, divesting non-core holdings, look at divesting assets that we really shouldn't be sustaining that do not actually create strong sustainable cash flow for the company or do not fit our priorities or strategy. We're going to keep doing those things.
We have been just really disciplined on our overall cost structure and bringing down CapEx, all creating more sources of cash. You go to uses of cash, and we have tried to be really clear. $2 billion-$2.1 billion of CapEx, which is down $550 million from a couple of years ago. It is roughly split $1.6 billion of sustaining CapEx, about $400 million-$500 million of growth in all these kind of targeted areas we have touched on in one way or another today. Potash automation, nitrogen debottlenecks, retail automation, proprietary products. That is really the $2 billion-$2.1 billion. We have about $500 million of capital leases and then, of course, just over $1 billion on the dividend. That takes you to $3.5 billion-$3.6 billion of total uses of cash.
Of course, we typically convert EBITDA to cash flow from operations at a 70%-75% ratio. Of course, we're trying to push that higher over time. For that dollar over $3.5-$3.6, it's really looking at a tuck-in acquisition or buying the company back. As you mentioned, the ratability of that buyback since September has been quite consistent. We want that to be consistent over time. We do not want that to be something that flies up unsustainably when we generate more cash and ramps down.
I think the run rate, if you look at what we've done year to date, kind of in that $45 million a month so far year to date, that's not a target or anything, but it's really that ratability through time and being able to have the balance sheet in a spot and cash flow in a spot where we can continue to give capital back to shareholders both through the dividend and the buyback.
Soon after Potash Age emerged in early 2018, you're doing a lot of tuck-ins. At that point, your multiple was higher than what you're buying tuck-ins at, six, seven times. Now, I think weirdly, I think your multiple is around almost the retailer acquisition. So it's kind of an interesting decision. It's sort of even. It's like a tie almost, right?
Yeah. Look, I think in that tie, when we think about it over time, I mean, there are two concepts here. One is just structurally returning capital to shareholders through a ratable share of purchase program as a more consistent return to capital. That is certainly a part of the philosophy here. The other is, as you said, we can buy back Nutrien with no integration or execution risk at a healthy multiple. We think that is a good way to deploy capital for shareholders. That is something that we have been doing consistently. Again, I think you look at our business, even though we are structurally growing earnings, we know it is going to be a cyclical business. We want that to be more consistent than ramping up and down over time.
If we get into a situation where we have sustained higher fertilizer prices, we'll also look at, hey, do we put some of that back on the balance sheet and increase that ratability over a longer period of time?
Thanks a lot, Mark. Appreciate it.
Yep. Thanks, Joel.