CF Industries Holdings announced a new commercial partnership with PepsiCo to supply low‑carbon urea‑ammonium nitrate (UAN) fertilizer for the company’s potato supply chain. The agreement marks the first time CF’s certified low‑carbon UAN product will be sold to a customer, positioning the firm as a pioneer in sustainable fertilizer solutions.
The UAN fertilizer is produced at CF’s Donaldsonville complex, which captures up to 2 million metric tons of CO₂ each year and qualifies for the U.S. 45Q tax credit. The partnership allows PepsiCo to meet its sustainability targets while giving CF a revenue stream that benefits from both the premium pricing of low‑carbon products and the tax incentives generated by the carbon‑capture facility that began operating in July 2025.
CF’s strategy to monetize its carbon‑capture advantage has been in place since 2020, when the company shifted focus to low‑carbon ammonia and nitrogen products. In 2025 CF reported net earnings of $1.46 billion and adjusted EBITDA of $2.89 billion, up from $1.22 billion and $2.28 billion in 2024, and Q1 2025 net earnings of $312 million on $644 million of adjusted EBITDA. The PepsiCo deal adds a new, high‑margin customer that supports the company’s growth trajectory and reinforces its commitment to decarbonization.
Management comments underscore the strategic fit. CF CEO Tony Will said, “By starting permanent sequestration now, we reduce our emissions, accelerate the availability of low‑carbon ammonia for our customers and begin generating valuable 45Q tax credits.” PepsiCo’s Chief Sustainability Officer Burgess Davis added, “Collaborating with CF Industries to deploy certified low‑carbon fertilizer across our potato supply chain allows us to reduce emissions while supporting farmers with solutions that fit seamlessly into their existing operations.”
The partnership reflects a broader industry trend toward reducing the carbon footprint of agriculture. PepsiCo has already partnered with other fertilizer producers to lower emissions, and the new deal opens the door for CF to expand its low‑carbon offerings to additional crop systems, potentially creating a new market for sustainable fertilizers across the food value chain.
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