CVR Partners, LP

What they do

CVR Partners produces nitrogen fertilizer products, primarily ammonia and UAN, at two facilities: Coffeyville, Kansas (pet coke gasification) and East Dubuque, Illinois (natural gas). Products are sold wholesale in the U.S., primarily to farmers for corn and wheat. The company is a variable distribution master limited partnership, majority-owned by CVR Energy.

Revenue drivers

• Ammonia — Produced at both facilities; sold as a standalone product or upgraded to other fertilizers. In Q2 2026, 64,000 net tons sold, average realized gate price $791/ton, up 33% YoY.
• UAN (urea ammonium nitrate) — Principal upgraded product, commands a premium over ammonia and urea. In Q2 2026, produced 342,000 tons, average realized gate price $392/ton, up 24% YoY.
• Seasonal demand — Demand is tied to crop planting and fertilizer application, with higher sales typically in the first half of the year. Spring fill programs drive volumes, while summer fill programs secure second-half business.
• Feedstock costs — Coffeyville uses pet coke (purchased from CVR Energy and third parties); East Dubuque uses natural gas. Price spreads between nitrogen fertilizer prices and feedstock costs significantly impact profitability.

Recent performance

For Q2 2026, CVR Partners reported net income of $78 million, or $7.33 per common unit, and EBITDA of $107 million on net sales of $202 million, compared to net income of $39 million and EBITDA of $67 million on net sales of $169 million in Q2 2025. Combined ammonia utilization was 99%. Average realized gate prices for ammonia and UAN rose 33% and 24% respectively year-over-year. For full-year 2025, revenue was $606 million, net income $98.7 million, and diluted EPS $9.33. Cash distribution declared for Q2 2026 was $6.08 per common unit.

Strategy

The company is executing debottlenecking and reliability projects to improve operations and increase output. At East Dubuque, an upcoming turnaround in August 2026 will include water system upgrades and a brownfield ammonia expansion expected to raise production capacity by about 5%. At Coffeyville, engineering is underway to enable natural gas as an alternative feedstock, which would provide dual feedstock flexibility. The Coffeyville facility also received a 'blue' ammonia certification in June 2026. IEP and CVR Energy are considering potential strategic transactions involving CVR Partners.

Risks

• Commodity price volatility — Nitrogen fertilizer prices are highly volatile, driven by global supply/demand, feedstock costs, and geopolitical factors, which can materially affect results and distributions.
• Seasonal and weather dependence — Demand depends on farmer planting decisions and weather; a poor season can lead to excess inventory or lost sales, impacting profitability.
• Feedstock and operational risks — Coffeyville relies on pet coke and East Dubuque on natural gas; any supply disruptions or price spikes can raise costs, and plant outages or reliability issues can reduce output and utilization.
• Strategic transaction uncertainty — IEP and CVR Energy are evaluating strategic options, including potential transactions involving CVR Partners, but there is no assurance any deal will materialize or its timing.

Outlook

Management expects the East Dubuque turnaround to begin in August 2026, lasting about six weeks, during which water system upgrades and the ammonia expansion are planned. They secured a solid book of business through the summer fill programs for the second half of 2026. Global nitrogen supply remains constrained due to geopolitical conflicts, which management says is supportive for prices. The company aims to complete the Coffeyville dual-feedstock project with construction in 2026 and 2027 pending board approval.