Intrepid Potash, Inc. (NYSE:IPI) Q3 2023 Earnings Call Transcript

Zachry Adams: Yes. Thanks for the question, Joel. I think part of that could be related to our Trio sales today and certainly over the last year have been a higher percentage for our domestic markets. And those typically carry a higher price point than international sales. So that could be related to what you’re seeing there as far as it tracking closer to potash with all of our potash sales being domestic markets as well.

Joel Jackson: Okay. Thank you for that. Now if you can get a big chunk, so you have a goal to get to 350,000 potash sales with all the operational expansions you’re doing improvements. If you get a big chunk of the way towards 350,000, what can we do for costs? Like you say you can get 20% to 30% cost improvement, do you think you can get half the distance to the goal line in 2024? Or what should we think about it?

Matthew Preston: Yes. It’s like I said, Joel, it’s certainly hard to say. We’ve seen some really good results from the Moab project so far. And the brine grade we’re pulling out into our ponds. Obviously, the Eddy shaft has been very strong so far. We have no expectations for that decreasing here as we continue to pump out of that and then start pumping out of the IP30B, the replacement extraction well towards the spring and early summer. That being said, I think kind of just take it to the midpoint. If we can get kind of halfway there, we’ll get half of those cost benefits in the 2024, 2025 season. And then kind of that full 20% to 30% when we’re back towards the 350,000-ton range.

Joel Jackson: Okay. Then I mean you’ve seen a lot of your peers, your potash – your peers over the last week to an earnings season really boost up now expectations for 2024 potash demand 3, 4, 5 million tons. A lot of questions about who’s going to supply the extra 3, 4, 5 million tons globally and people definitely assumptions around what Belarus and Russia can do and what CapEx can do with some of the logistics constraints. You’re obviously a smaller player in the market, but you – and I see the lost strength in North America, nutrient based list prices. How do you see the market right now in potash? Anything open question and how are you seeing more exports come on the river from the FSU? Are you seeing anything in the last couple of months making you more excited about the outlook for next year? And maybe talk about demand, supply, anything you want within a very broad question.

Robert Jornayvaz: Joel, thanks for the question. I think the previous earnings calls, you’ve heard the same story. We expect a pretty robust demand, especially at these values. We continue to see fertilizer imports out of Russia in all fertilizer products, which is somewhat surprising given the magnitude of the imports we’re seeing from Russia, but they’re there. We agree with the demand figures that you threw out. We anticipate robust demand. And that’s why we are so laser-focused on getting our production back to the high end of our historical ranges. Zach, I don’t know if you want to add any color, but we did see a robust 2024.

Zachry Adams: Yes, I would just echo that, Bob. All signs fall application has been good across the geographies that we participate in that. And our expectation is we’ll see that continue into the spring. And obviously, the crop commodity prices, they incentivize growers to maximize yields and not only those, Joel, a lot of our markets, we provide nutrients to forage and grass markets and cattle processing is at historical highs as well. And so we see really good demand on the pasture and hay ground across those markets as ranchers look to kind of reinvest in their grass and their acres there as well.

Joel Jackson: Okay. Finally for me, that…

Robert Jornayvaz: Did that answer your very broad question?

Joel Jackson: Yes, it did. I know, Bob, you talked about – I can’t remember what forums, whether it was print media or on these conference calls about being surprised. I don’t want to put words in your mouth about Russian imports into the States. So yes, I guess one more question for me on Oilfield Solutions. What kind of expectations directionally like should we expect in 2024 from that business? Is it a little higher or a lot higher, maybe can give us some of the puts and takes to expect in 2024 from that business?