EBITDA Sensitivity Decline
Q: Why is EBITDA down $300 million at each gas and urea price?
A: The sensitivity table reflects updated pricing relationships between products based on last year's data. The relative premium of UAN over urea decreased, impacting EBITDA across all scenarios. Additionally, although they added the Waggaman facility, maintenance turnarounds on large plants like table number 6 reduce production. Thus, expected volumes and EBITDA are adjusted accordingly.

Capital Allocation Strategy
Q: Should you prioritize share buybacks over new capacity investments?
A: The company believes in balancing disciplined capacity expansion with share repurchases to create shareholder value. Historically, investing in capacity has generated returns well above their cost of capital, benefiting shareholders more than exclusively buying back shares. They will continue to evaluate investments that generate risk-adjusted returns above their cost of capital while also repurchasing shares.

European Production Outlook
Q: Will idled European production restart given lower gas prices?
A: Despite European gas prices decreasing to $7-$8 , the spread with U.S. gas prices at $1.60-$1.65 remains significant. European producers are still the marginal producers setting the price floor. Restarting idled plants involves costs beyond immediate cash costs, including maintenance and working capital considerations. Some plants may restart as gas prices improve and in response to events like Russia limiting ammonium nitrate exports. However, significant improvements in European gas supply are not expected in the short term. ,

Carbon Reduction Technologies
Q: How will different technologies impact carbon reduction?
A: The company is evaluating technologies like conventional CCS, flue gas capture, and autothermal reforming (ATR) to reduce carbon emissions. Conventional CCS at their Donaldsonville plant reduces carbon intensity by about 70%. Combining flue gas capture with process gas CCS can reduce CO₂ emissions by over 95%. ATR can also achieve 90%-95% reduction but requires a large air separation unit, increasing costs and Scope 2 emissions due to higher electricity use. They're exploring all options to meet customer demand for low-carbon products while balancing operational costs and strategic long-term goals.

Blue Ammonia Projects and Partnerships
Q: What is the status of blue ammonia projects and partnerships?
A: The company is pleased with their partnerships, particularly in Japan and Korea, and is considering new production capacity targeting these markets. If they decide not to proceed with the Blue Point project, it may be due to aggregate costs and inability to earn an appropriate risk-adjusted return. They believe global supply and demand dynamics are favorable for capacity expansion if returns are acceptable. Blue ammonia is economically viable even without premium pricing due to incentives like the 45Q tax credit. They expect increasing interest and potential premiums due to limited supply relative to demand. ,

North American Spring Demand and Imports
Q: How is spring demand shaping up, and are imports lower?
A: Despite a strong fall ammonia application, there is substantial spring demand for ammonia, UAN, and urea due to expectations of early spring, good soil moisture, and higher corn acreage. Imports have been lower, and inventory levels are low, which may pose challenges in meeting demand. Prices are appreciating, and the company is prepared for the strong demand, even accounting for some production loss in January.

Carbon Capture at Waggaman Site
Q: Any update on CCS at the Waggaman site?
A: The company is evaluating carbon capture and storage (CCS) at the Waggaman site similar to other locations in their network. With Louisiana gaining primacy on Class VI wells, approvals for CCS projects should expedite. They're optimistic about incorporating Waggaman into their CCS plans as part of their broader strategy to reduce emissions.

Brazilian Market and Export Opportunities
Q: What are inventory levels in Brazil, and export prospects?
A: Brazil's fertilizer consumption is growing, requiring over 8 million tons of urea imports this year, making it the largest importing country surpassing India. High inventory levels at the start of the year have been consumed during the safrinha season. The company views Brazil as a positive export market due to consistent demand growth and is actively exporting products like UAN and urea there.

Farmer Income Outlook
Q: Are you more positive on farmer incomes and industry prospects?
A: The company is positive about farmer incomes in 2024, expecting it to be the fourth best year in ten years. Corn prices at $4.70-$6.00 are attractive, making farming profitable even with lower yield trends. Lower fertilizer and diesel prices also reduce costs for farmers. Overall, they are optimistic about industry prospects based on strong demand and favorable market conditions.