The ratings on Norway-based Yara International ASA reflect its leading position as the world's largest distributor of fertilizers and producer of nitrogen; its strong cost position derived from increasing capacity in countries with low gas costs; strong geographic diversification; and its intermediate financial profile. The ratings are constrained by the high cyclicality of the ammonia business, which is very sensitive to supply-and-demand imbalances, resulting in difficulties in passing on volatility in gas prices, the key raw-material cost. Yara is also exposed to the sensitivity of fertilizers to weather conditions and farmers' income. Yara had revenues of Norwegian krone (Nkr) 46 billion ($6.5 billion) for the full year 2005. Yara runs large-scale plants within Europe and has no production assets in
