EsConsumer fertilizer and growing products supplier Scotts Miracle-Gro reported a 105% year over year surge in FQ1’21 (calendar Q4’20) revenues resulting from increased stay-at-home activity during the pandemic.
Yet, the firm is experiencing a drag from increased costs for raw materials and shipping, much to the annoyance of CEO James Hagedorn who has stated “what’s happening to some of the commodities that I think are completely unjustified when it comes to pricing and that you’re hearing about kind of for the first time from us, but we’re kind of on it right now as well. This idea of sort of plastics, ocean freight, domestic freight, insurance, it’s a bunch of damn nonsense that people are taking the kind of pricing they’re taking on that stuff. I think it’s really bad for America“.
Panjiva’s data shows that U.S. seaborne imports linked to the firm increased by 80.1% year over year in the three months to Nov. 30, covering products sold in Q4’20, before slowing by 10.0% year over year in December.
The firm’s imports, which are led by imports of peat from Canada and nitrogenous fertilizers from Japan, will continue to face elevated shipping costs in the new year as ports remain congested and the container lines look to void sailings after the lunar new year to reset their networks, as outlined in Panjiva’s research of Feb. 2.
Source: Panjiva
Scotts Miracle-Gro’s exposure to the consumer market may be one reason why its supply chain performance has been stronger than the growing supplies more broadly. Total U.S. imports of peat and fertilizers that Scotts’ imports fell by 2.0% year over year in the three months to Nov. 30.
That includes agricultural grade imports by firms including Yara and Mosaic, though there was a recovery of 11.1% year over year in November. There’s also been a shift in sourcing with imports from Canada, which presumably have lower shipping costs, increasing by 18.3% while those from Russia fell by 13.1%.
Source: Panjiva
