The ratings on Norway-based Yara International ASA reflect its leading position as the world's largest distributor of fertilizers and producer of nitrogen; strong cost position derived from increasing capacity in countries with low gas costs; strong geographic diversification; and 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. Yara is also exposed to the sensitivity of fertilizers to weather conditions and farmers' income. Yara's revenues were Norwegian krone (Nkr) 48.6 billion ($7.5 billion) for the 12 months ending June 30, 2006. Yara runs large-scale plants in Europe, and has no production assets in the U.S., resulting in
