UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_______________________________________________________________________

FORM 10-Q  

_______________________________________________________________________

☑    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2021

OR

 ☐     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                     

Commission file number 001-32327  

_______________________________________________________________________

The Mosaic Company

(Exact name of registrant as specified in its charter)  

_______________________________________________________________________

Delaware	20-1026454
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

101 East Kennedy Blvd

Suite 2500

Tampa, Florida 33602

(800) 918-8270

(Address and zip code of principal executive offices and registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)  

_______________________________________________________________________

Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01 per share	MOS	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes  x    No  ¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes  x     No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):    Large accelerated filer  x    Accelerated filer  ¨    Non-accelerated filer  ¨    Smaller reporting company  ☐ Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes  ☐    No  x

Indicate the number of shares outstanding of each of the issuer’s classes of common stock as of the latest practicable date: 379,896,944 shares of Common Stock as of July 30, 2021.

Table of Contents
PART I.	FINANCIAL INFORMATION
	Item 1.	Financial Statements	1
		Condensed Consolidated Statements of Earnings (Loss)	1
		Condensed Consolidated Statements of Comprehensive Income (Loss)	2
		Condensed Consolidated Balance Sheets	3
		Condensed Consolidated Statements of Cash Flows	4
		Condensed Consolidated Statements of Equity	6
		Notes to Condensed Consolidated Financial Statements	7
	Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	30
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	48
	Item 4.	Controls and Procedures	51
PART II.	OTHER INFORMATION
	Item 1.	Legal Proceedings	52
	Item 1A.	Risk Factors	55
	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	56
	Item 4.	Mine Safety Disclosures	56
	Item 6.	Exhibits	57
	Signatures		58

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

THE MOSAIC COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (LOSS)

(In millions, except per share amounts)

(Unaudited)

	Three months ended				Six months ended
	June 30, 2021		June 30, 2020		June 30, 2021		June 30, 2020
Net sales	$	2,800.7	$	2,044.7	$	5,097.8	$	3,842.8
Cost of goods sold	2,048.4		1,787.7		3,910.6		3,544.4
Gross margin	752.3		257.0		1,187.2		298.4
Selling, general and administrative expenses	107.6		95.1		209.3		163.0
Mine closure costs	158.1		—		158.1		—
Other operating expense	2.6		76.1		22.6		115.8
Operating earnings	484.0		85.8		797.2		19.6
Interest expense, net	(37.3)		(49.3)		(82.3)		(90.4)
Foreign currency transaction gain (loss)	111.1		34.1		65.3		(180.1)
Other income	1.4		2.4		4.4		6.9
Earnings (loss) from consolidated companies before income taxes	559.2		73.0		784.6		(244.0)
Provision for (benefit from) income taxes	115.9		(2.7)		175.6		(135.7)
Earnings (loss) from consolidated companies	443.3		75.7		609.0		(108.3)
Equity in net (loss) of nonconsolidated companies	(4.5)		(29.8)		(12.0)		(49.8)
Net earnings (loss) including noncontrolling interests	438.8		45.9		597.0		(158.1)
Less: Net earnings (loss) attributable to noncontrolling interests	1.6		(1.5)		3.1		(2.5)
Net earnings (loss) attributable to Mosaic	$	437.2	$	47.4	$	593.9	$	(155.6)
Basic net earnings (loss) per share attributable to Mosaic	$	1.15	$	0.13	$	1.56	$	(0.41)
Basic weighted average number of shares outstanding	379.8		379.1		379.5		378.9
Diluted net earnings (loss) per share attributable to Mosaic	$	1.14	$	0.12	$	1.55	$	(0.41)
Diluted weighted average number of shares outstanding	383.3		381.3		383.0		378.9

See Notes to Condensed Consolidated Financial Statements

1

THE MOSAIC COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(In millions)

(Unaudited)

	Three months ended				Six months ended
	June 30, 2021		June 30, 2020		June 30, 2021		June 30, 2020
Net earnings (loss) including noncontrolling interest	$	438.8	$	45.9	$	597.0	$	(158.1)
Other comprehensive income (loss), net of tax
Foreign currency translation gain (loss)	297.2		55.3		191.1		(548.1)
Net actuarial gain (loss) and prior service cost	1.2		6.0		5.0		7.8
Realized gain on interest rate swap	0.5		0.3		1.0		0.8
Net gain (loss) on marketable securities held in trust fund	3.6		7.9		(14.2)		15.9
Other comprehensive income (loss)	302.5		69.5		182.9		(523.6)
Comprehensive income (loss)	741.3		115.4		779.9		(681.7)
Less: Comprehensive income (loss) attributable to noncontrolling interest	4.9		(2.8)		4.1		(11.1)
Comprehensive income (loss) attributable to Mosaic	$	736.4	$	118.2	$	775.8	$	(670.6)

See Notes to Condensed Consolidated Financial Statements

2

THE MOSAIC COMPANY

CONDENSED CONSOLIDATED BALANCE SHEETS

(In millions, except per share amounts)

(Unaudited)

	June 30, 2021		December 31, 2020
Assets
Current assets:
Cash and cash equivalents	$	1,417.6	$	574.0
Receivables, net, including affiliate receivables of $78.2 and $144.8, respectively	930.5		881.1
Inventories	2,194.4		1,739.2
Other current assets	445.1		326.9
Total current assets	4,987.6		3,521.2
Property, plant and equipment, net of accumulated depreciation of $7,968.4 and $8,106.8, respectively	12,062.8		11,854.3
Investments in nonconsolidated companies	668.7		673.1
Goodwill	1,201.3		1,173.0
Deferred income taxes	1,169.4		1,179.4
Other assets	1,383.7		1,388.8
Total assets	$	21,473.5	$	19,789.8
Liabilities and Equity
Current liabilities:
Short-term debt	$	0.1	$	0.1
Current maturities of long-term debt	494.9		504.2
Structured accounts payable arrangements	830.7		640.0
Accounts payable	924.8		769.1
Accrued liabilities	1,887.4		1,233.1
Total current liabilities	4,137.9		3,146.5
Long-term debt, less current maturities	3,967.9		4,073.8
Deferred income taxes	1,073.5		1,060.8
Other noncurrent liabilities	1,778.6		1,753.5
Equity:
Preferred Stock, $0.01 par value, 15,000,000 shares authorized, none issued and outstanding as of June 30, 2021 and December 31, 2020	—		—
Common Stock, $0.01 par value, 1,000,000,000 shares authorized, 390,776,964 shares issued and 379,894,467 shares outstanding as of June 30, 2021, 389,974,041 shares issued and 379,091,544 shares outstanding as of December 31, 2020	3.8		3.8
Capital in excess of par value	882.6		872.8
Retained earnings	11,075.9		10,511.0
Accumulated other comprehensive loss	(1,624.3)		(1,806.2)
Total Mosaic stockholders' equity	10,338.0		9,581.4
Noncontrolling interests	177.6		173.8
Total equity	10,515.6		9,755.2
Total liabilities and equity	$	21,473.5	$	19,789.8

See Notes to Condensed Consolidated Financial Statements

3

THE MOSAIC COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

(Unaudited)

	Six months ended
	June 30, 2021		June 30, 2020
Cash Flows from Operating Activities:
Net (loss) earnings including noncontrolling interests	$	597.0	$	(158.1)
Adjustments to reconcile net (loss) earnings including noncontrolling interests to net cash provided by operating activities:
Depreciation, depletion and amortization	412.6		433.2
Deferred and other income taxes	38.9		(123.8)
Equity in net loss of nonconsolidated companies, net of dividends	15.1		49.8
Accretion expense for asset retirement obligations	35.1		34.0
Accretion expense for leases	7.2		13.6
Share-based compensation expense	19.2		(1.9)
Unrealized loss (gain) on derivatives	(45.5)		47.2
Foreign currency adjustments	(116.4)		207.3
Net proceeds from settlement of interest rate swaps	—		34.7
Mine closure costs	158.1		—
Other	(17.1)		10.0
Changes in assets and liabilities:
Receivables, net	(46.4)		42.8
Inventories	(402.0)		(70.6)
Other current and noncurrent assets	(53.1)		55.0
Accounts payable and accrued liabilities	724.0		391.0
Other noncurrent liabilities	7.2		39.4
Net cash provided by operating activities	1,333.9		1,003.6
Cash Flows from Investing Activities:
Capital expenditures	(585.8)		(520.7)
Purchases of available-for-sale securities - restricted	(200.5)		(348.5)
Proceeds from sale of available-for-sale securities - restricted	186.1		341.0
Purchases of held-to-maturity securities	(0.8)		(0.7)
Proceeds from sale of held-to-maturity securities	0.8		0.8
Other	20.6		0.5
Net cash used in investing activities	(579.6)		(527.6)
Cash Flows from Financing Activities:
Payments of short-term debt	(25.0)		(821.5)
Proceeds from issuance of short-term debt	25.0		1,395.0
Payments of structured accounts payable arrangements	(342.7)		(701.6)
Proceeds from structured accounts payable arrangements	527.5		365.3
Collections of transferred receivables	188.7		—
Payments of transferred receivables	(160.6)		—
Payments of long-term debt	(128.7)		(31.4)
Cash dividends paid	(47.5)		(37.9)
Other	2.9		(0.3)
Net cash provided by financing activities	39.6		167.6
Effect of exchange rate changes on cash	49.1		(84.3)
Net change in cash, cash equivalents and restricted cash	843.0		559.3
Cash, cash equivalents and restricted cash - December 31	594.4		532.3
Cash, cash equivalents and restricted cash - June 30	$	1,437.4	$	1,091.6

See Notes to Condensed Consolidated Financial Statements

4

THE MOSAIC COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)

(In millions)

(Unaudited)

	Six months ended
	June 30, 2021		June 30, 2020
Reconciliation of cash, cash equivalents and restricted cash reported within the unaudited condensed consolidated balance sheets to the unaudited condensed consolidated statements of cash flows:
Cash and cash equivalents	$	1,417.6	$	1,073.3
Restricted cash in other current assets	10.6		8.5
Restricted cash in other assets	9.2		9.8
Total cash, cash equivalents and restricted cash shown in the unaudited condensed consolidated statement of cash flows	$	1,437.4	$	1,091.6
Supplemental Disclosure of Cash Flow Information:
Cash paid during the period for:
Interest (net of amount capitalized of $18.4 and $15.1 for the six months ended June 30, 2021 and 2020, respectively)	$	89.6	$	103.3
Income taxes (net of refunds)	118.9		(21.7)

See Notes to Condensed Consolidated Financial Statements

5

THE MOSAIC COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

(In millions, except per share amounts)

(Unaudited)

		Mosaic Shareholders
	Shares	Dollars
	Common Stock	Common Stock		Capital in Excess of Par Value		Retained Earnings		Accumulated Other Comprehensive (Loss)		Noncontrolling Interests		Total Equity
Balance as of March 31, 2020	379.0	$	3.8	$	847.7	$	9,718.7	$	(2,184.0)	$	173.7	$	8,559.9
Total comprehensive income (loss)	—	—		—		47.4		70.8		(2.8)		115.4
Vesting of restricted stock units	0.1	—		(0.3)		—		—		—		(0.3)
Stock based compensation	—	—		8.0		—		—		—		8.0
Dividends ($0.05 per share)	—	—		—		(19.1)		—		—		(19.1)
Dividends for noncontrolling interests	—	—		—		—		—		(0.2)		(0.2)
Balance as of June 30, 2020	379.1	$	3.8	$	855.4	$	9,747.0	$	(2,113.2)	$	170.7	$	8,663.7
Balance as of December 31, 2019	378.8	$	3.8	$	858.4	$	9,921.5	$	(1,598.2)	$	182.1	$	9,367.6
Total comprehensive income (loss)	—	—		—		(155.6)		(515.0)		(11.1)		(681.7)
Vesting of restricted stock units	0.3	—		(2.7)		—		—		—		(2.7)
Stock based compensation	—	—		(0.3)		—		—		—		(0.3)
Dividends ($0.05 per share)	—	—		—		(18.9)		—		—		(18.9)
Dividends for noncontrolling interests	—	—		—		—		—		(0.3)		(0.3)
Balance as of June 30, 2020	379.1	$	3.8	$	855.4	$	9,747.0	$	(2,113.2)	$	170.7	$	8,663.7
Balance as of March 31, 2021	379.7	$	3.8	$	876.2	$	10,667.7	$	(1,923.5)	$	172.8	$	9,797.0
Total comprehensive income (loss)	—	—		—		437.2		299.2		4.9		741.3
Stock option exercises	—	—		3.2		—		—		—		3.2
Vesting of restricted stock units	0.2	—		(3.3)		—		—		—		(3.3)
Stock based compensation	—	—		6.5		—		—		—		6.5
Dividends ($0.075 per share)	—	—		—		(29.0)		—		—		(29.0)
Dividends for noncontrolling interests	—	—		—		—		—		(0.1)		(0.1)
Balance as of June 30, 2021	379.9	$	3.8	$	882.6	$	11,075.9	$	(1,624.3)	$	177.6	$	10,515.6
Balance as of December 31, 2020	379.1	$	3.8	$	872.8	$	10,511.0	$	(1,806.2)	$	173.8	$	9,755.2
Total comprehensive income (loss)	—	—		—		593.9		181.9		4.1		779.9
Stock option exercises		—		3.2		—		—		—		3.2
Vesting of restricted stock units	0.8	—		(10.9)		—		—		—		(10.9)
Stock based compensation	—	—		17.5		—		—		—		17.5
Dividends ($0.075 per share)	—	—		—		(29.0)		—		—		(29.0)
Dividends for noncontrolling interests	—	—		—		—		—		(0.3)		(0.3)
Balance as of June 30, 2021	379.9	$	3.8	$	882.6	$	11,075.9	$	(1,624.3)	$	177.6	$	10,515.6

See Notes to Condensed Consolidated Financial Statements

6

THE MOSAIC COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Tables in millions, except per share amounts and as otherwise designated)

(Unaudited)

1. Organization and Nature of Business

The Mosaic Company (“Mosaic,” and, with its consolidated subsidiaries, “we,” “us,” “our,” or the “Company”) produces and markets concentrated phosphate and potash crop nutrients. We conduct our business through wholly and majority owned subsidiaries and businesses in which we own less than a majority or a non-controlling interest, including consolidated variable interest entities and investments accounted for by the equity method.

We are organized into the following business segments:

•Our Phosphates business segment owns and operates mines and production facilities in Florida which produce concentrated phosphate crop nutrients and phosphate-based animal feed ingredients, and processing plants in Louisiana which produce concentrated phosphate crop nutrients. The Phosphates segment includes our 75% interest in the Miski Mayo Phosphate Mine in Peru. These results are consolidated in the Phosphates segment. The Phosphates segment also includes our 25% interest in the Ma’aden Wa’ad Al Shamal Phosphate Company (the “MWSPC”), a joint venture to develop, own and operate integrated phosphate production facilities in the Kingdom of Saudi Arabia. We market approximately 25% of the MWSPC phosphate production. We recognize our equity in the net earnings or losses relating to MWSPC on a one-quarter lag in our Condensed Consolidated Statements of Earnings (Loss).

•Our Potash business segment owns and operates potash mines and production facilities in Canada and the U.S. which produce potash-based crop nutrients, animal feed ingredients and industrial products. Potash sales include domestic and international sales. We are a member of Canpotex, Limited (“Canpotex”), an export association of Canadian potash producers through which we sell our Canadian potash outside the U.S. and Canada.

•Our Mosaic Fertilizantes business segment includes the assets in Brazil that we acquired in the 2018 acquisition (the “Acquisition”) of Vale Fertilizantes S.A. (now known as Mosaic Fertilizantes P&K S.A. or the “Acquired Business”), which consist of five phosphate rock mines, four phosphate chemical plants and a potash mine. The segment also includes our legacy distribution business in South America, which consists of sales offices, crop nutrient blending and bagging facilities, port terminals and warehouses in Brazil and Paraguay. We also have a majority interest in Fospar S.A., which owns and operates a single superphosphate granulation plant and a deep-water crop nutrition port and throughput warehouse terminal facility in Brazil.

Intersegment eliminations, unrealized mark-to-market gains/losses on derivatives, debt expenses, Streamsong Resort® results of operations, and the results of the China and India distribution businesses are included within Corporate, Eliminations and Other.

2. Summary of Significant Accounting Policies

Statement Presentation and Basis of Consolidation

The accompanying unaudited Condensed Consolidated Financial Statements of Mosaic have been prepared on the accrual basis of accounting and in accordance with the requirements of the Securities and Exchange Commission (“SEC”) for interim financial reporting. As permitted under these rules, certain footnotes and other financial information that are normally required by accounting principles generally accepted in the United States (“GAAP”) can be condensed or omitted. The Condensed Consolidated Financial Statements included in this document reflect, in the opinion of our management, all adjustments (consisting of only normal recurring adjustments) necessary for a fair presentation of the results for the interim periods presented. The following notes should be read in conjunction with the accounting policies and other disclosures in the Notes to the Consolidated Financial Statements included in our Annual Report on Form 10-K filed with the SEC for the year ended December 31, 2020 (the “10-K Report”). Sales, expenses, cash flows, assets and liabilities can and do vary during the year as a result of seasonality and other factors. Therefore, interim results are not necessarily indicative of the results to be expected for the full fiscal year.

7

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	THE MOSAIC COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

The accompanying Condensed Consolidated Financial Statements include the accounts of Mosaic, its majority-owned subsidiaries, and certain variable interest entities in which Mosaic is the primary beneficiary. Certain investments in companies where we do not have control but have the ability to exercise significant influence are accounted for by the equity method.

Accounting Estimates

Preparation of the Condensed Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of net sales and expenses during the reporting periods. The most significant estimates made by management relate to the estimates of fair value of acquired assets and liabilities, the recoverability of non-current assets including goodwill, the useful lives and net realizable values of long-lived assets, environmental and reclamation liabilities, including asset retirement obligations (“ARO”), and income tax-related accounts, including the valuation allowance against deferred income tax assets. Actual results could differ from these estimates.

8

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	THE MOSAIC COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

3. Other Financial Statement Data

The following provides additional information concerning selected balance sheet accounts:

	June 30, 2021		December 31, 2020
Other current assets
Income and other taxes receivable	$	217.9	$	181.4
Prepaid expenses	107.9		80.4
Other	119.3		65.1
	$	445.1	$	326.9
Other assets
Restricted cash	$	10.6	$	12.3
MRO inventory	133.8		137.7
Marketable securities held in trust	733.9		734.3
Operating lease right-of-use assets	147.8		173.1
Indemnification asset	22.2		23.0
Long-term receivable	51.3		52.6
Other	284.1		255.8
	$	1,383.7	$	1,388.8
Accrued liabilities
Payroll and employee benefits	$	186.0	$	195.5
Asset retirement obligations	174.8		190.2
Receivable factoring liability	28.1		—
Customer prepayments (a)	881.4		287.6
Accrued income and other taxes	91.4		83.1
Operating lease obligation	62.9		64.0
Other	462.8		412.7
	$	1,887.4	$	1,233.1
Other noncurrent liabilities
Asset retirement obligations	$	1,244.6	$	1,203.7
Operating lease obligation	88.0		109.6
Accrued pension and postretirement benefits	164.7		158.5
Unrecognized tax benefits	42.9		46.4
Other	238.4		235.3
	$	1,778.6	$	1,753.5

______________________________

(a) The timing of recognition of revenue related to our performance obligations may be different than the timing of collection of cash related to those performance obligations. Specifically, we collect prepayments from certain customers in Brazil. In addition, cash collection from Canpotex may occur prior to delivery of product to the end customer. We generally satisfy our contractual liabilities within one quarter of incurring the liability.

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	THE MOSAIC COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

4. Earnings Per Share

The numerator for basic and diluted earnings per share (“EPS”) is net earnings attributable to Mosaic. The denominator for basic EPS is the weighted average number of shares outstanding during the period. The denominator for diluted EPS also includes the weighted average number of additional common shares that would have been outstanding if the dilutive potential common shares had been issued, unless the shares are anti-dilutive.

The following is a reconciliation of the numerator and denominator for the basic and diluted EPS computations:

	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Net income (loss) attributable to Mosaic	$	437.2	$	47.4	$	593.9	$	(155.6)
Basic weighted average number of shares outstanding	379.8		379.1		379.5		378.9
Dilutive impact of share-based awards	3.5		2.2		3.5		—
Diluted weighted average number of shares outstanding	383.3		381.3		383.0		378.9
Basic net income (loss) per share attributable to Mosaic	$	1.15	$	0.13	$	1.56	$	(0.41)
Diluted net income (loss) per share attributable to Mosaic	$	1.14	$	0.12	$	1.55	$	(0.41)

A total of 0.5 million shares of common stock subject to issuance related to share-based awards for the three and six months ended June 30, 2021 and 3.4 million and 3.0 million for the three and six months ended June 30, 2020, respectively, have been excluded from the calculation of diluted EPS because the effect would have been anti-dilutive.

5. Inventories

Inventories consist of the following:

	June 30, 2021		December 31, 2020
Raw materials	$	193.0	$	92.1
Work in process	698.8		634.5
Finished goods	1,136.7		868.2
Final price deferred(a)	23.9		23.0
Operating materials and supplies	142.0		121.4
	$	2,194.4	$	1,739.2

______________________________

(a)Final price deferred is product that has shipped to customers, but the price has not yet been agreed upon.

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	THE MOSAIC COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

6. Goodwill

Mosaic had goodwill of $1.2 billion as of June 30, 2021 and December 31, 2020, respectively. We review goodwill for impairment annually in October and at any time events or circumstances indicate that the carrying value may not be fully recoverable, which is based on our accounting policy and GAAP. The changes in the carrying amount of goodwill, by reporting unit, are as follows:

	Potash		Mosaic Fertilizantes		Corporate, Eliminations and Other		Total
Balance as of December 31, 2020	$	1,063.2	$	97.7	$	12.1	$	1,173.0
Foreign currency translation	27.3		1.0		—		28.3
Balance as of June 30, 2021	$	1,090.5	$	98.7	$	12.1	$	1,201.3

We are required to perform our next annual goodwill impairment analysis as of October 31, 2021. It is possible that future business conditions could deteriorate from the current state, raw material or product price projections could decline significantly from current estimates, or our common stock price could decline significantly. If our net sales and cash flow projections are not achieved or our common stock price significantly declines from current levels, book values of certain operations could exceed their fair values, which may result in goodwill impairment charges in future periods. It is not possible at this time to determine if any such future impairment charge would result or, if it does, whether such charge would be material.

7. Marketable Securities Held in Trusts

In August 2016, Mosaic deposited $630 million into two trust funds (together, the “RCRA Trusts”) created to provide additional financial assurance in the form of cash for the estimated costs (“Gypstack Closure Costs”) of closure and long term care of our Florida and Louisiana phosphogypsum management systems (“Gypstacks”), as described further in Note 9 of our Notes to Condensed Consolidated Financial Statements. Our actual Gypstack Closure Costs are generally expected to be paid by us in the normal course of our Phosphate business; however, funds held in each of the RCRA Trusts can be drawn by the applicable governmental authority in the event we cannot perform our closure and long term care obligations. When our estimated Gypstack Closure Costs with respect to the facilities associated with a RCRA Trust are sufficiently lower than the amount on deposit in that RCRA Trust, we have the right to request that the excess funds be released to us. The same is true for the RCRA Trust balance remaining after the completion of our obligations, which will be performed over a period that may not end until three decades or more after a Gypstack has been closed. The investments held by the RCRA Trusts are managed by independent investment managers with discretion to buy, sell, and invest pursuant to the objectives and standards set forth in the related trust agreements. Amounts reserved to be held or held in the RCRA Trusts (including losses or reinvested earnings) are included in other assets on our Condensed Consolidated Balance Sheets.

The RCRA Trusts hold investments, which are restricted from our general use, in marketable debt securities classified as available-for-sale and are carried at fair value. As a result, unrealized gains and losses are included in other comprehensive income until realized, unless it is determined that the carrying value of an investment is impaired on an other-than-temporary basis.

We review the fair value hierarchy classification on a quarterly basis. Changes in the ability to observe valuation inputs may result in a reclassification of levels for certain securities within the fair value hierarchy. We determine the fair market values of our available-for-sale securities and certain other assets based on the fair value hierarchy described below:

Level 1: Values based on unadjusted quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities.

Level 2: Values based on quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, or model-based valuation techniques for which all significant assumptions are observable in the market.

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Level 3: Values generated from model-based techniques that use significant assumptions not observable in the market. These unobservable assumptions reflect our own estimates of assumptions that market participants would use in pricing the asset or liability. Valuation techniques include use of option pricing models, discounted cash flow models and similar techniques.

There were no other-than-temporary impairment write-downs on available-for-sale securities during the six months ended June 30, 2021.

The estimated fair value of the investments in the RCRA Trusts as of June 30, 2021 and December 31, 2020 are as follows:

	June 30, 2021
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
Level 1
Cash and cash equivalents	$	7.9	$	—	$	—	$	7.9
Level 2
Corporate debt securities	198.6		9.2		(0.2)		207.6
Municipal bonds	197.2		8.1		(0.4)		204.9
U.S. government bonds	302.2		0.5		(4.5)		298.2
Total	$	705.9	$	17.8	$	(5.1)	$	718.6
	December 31, 2020
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
Level 1
Cash and cash equivalents	$	11.8	$	—	$	—	$	11.8
Level 2
Corporate debt securities	193.3		14.0		—		207.3
Municipal bonds	190.5		8.8		(0.3)		199.0
U.S. government bonds	300.7		4.7		(0.1)		305.3
Total	$	696.3	$	27.5	$	(0.4)	$	723.4

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The following tables show gross unrealized losses and fair values of the RCRA Trusts’ available-for-sale securities that have been in a continuous unrealized loss position deemed to be temporary as of June 30, 2021 and December 31, 2020:

	June 30, 2021				December 31, 2020
(in millions)	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
Securities that have been in a continuous loss position for less than 12 months:
Corporate debt securities	$	23.5	$	(0.2)	$	1.5	$	—
Municipal bonds	25.0		(0.3)		16.0		(0.2)
U.S. government bonds	265.0		(4.5)		120.3		(0.1)
	$	313.5	$	(5.0)	$	137.8	$	(0.3)
Securities that have been in a continuous loss position for more than 12 months:
Corporate debt securities	$	—	$	—	$	—	$	—
Municipal bonds	7.0		(0.1)		4.6		(0.1)
U.S. government bonds	—		—		—		—
	$	7.0	$	(0.1)	$	4.6	$	(0.1)

The following table summarizes the balance by contractual maturity of the available-for-sale debt securities invested by the RCRA Trusts as of June 30, 2021. Actual maturities may differ from contractual maturities because the issuers of the securities may have the right to prepay obligations before the underlying contracts mature.

	June 30, 2021
Due in one year or less	$	30.1
Due after one year through five years	308.6
Due after five years through ten years