CF Industries

Moat composition and weights: cost advantage 55%, efficient scale 30%, switching costs 10%, intangibles 5%.

Cost advantage (85/100): CF benefits from North American low‑cost gas, high asset utilization, multi‑product flexibility, and a broad distribution system, underpinning attractive spreads vs higher‑cost imports, particularly when overseas gas rises.

Management consistently runs assets above peers and ships more than 18 million tons annually across a deep network with pipeline connectivity and 3 million tons of storage. Efficient scale (75/100): New world‑scale ammonia capacity requires multibillion‑dollar capex, permitting, CO2 handling, and export logistics.

CF’s plants at Donaldsonville, Port Neal, Verdigris, Yazoo City, Medicine Hat, and Waggaman sit in advantaged corridors with pipeline and deep‑water access, limiting profitable entry at scale. 2025 gross ammonia production expected around 10 million tons reinforces scale.

Switching costs (30/100): Product is a commodity and farmers can switch sources, but CF’s forward sales, reliability, storage, and pipeline proximity create practical frictions and availability premiums at peak seasons. Intangibles (20/100): Brand and patents play minor roles; operational know‑how and safety culture matter but are not exclusive.

Network effects (0/100): Not applicable. Weighted result supports a narrow but durable moat primarily from cost and scale.