We are one of the largest manufacturers and distributors of nitrogen fertilizer products and other nitrogen products in the world. Our principal customers are cooperatives, independent fertilizer distributors, farmers and industrial users. Our principal nitrogen fertilizer products are ammonia, granular urea, urea ammonium nitrate solution (UAN) and ammonium nitrate (AN). Our other nitrogen products include diesel exhaust fluid (DEF), urea liquor, nitric acid and aqua ammonia, which are sold primarily to our industrial customers, and compound fertilizer products (NPKs), which are solid granular fertilizer products for which the nutrient content is a combination of nitrogen, phosphorus, and potassium. ~~Our~~We operate world-class nitrogen manufacturing ~~and distribution facilities are concentrated~~complexes in ~~the midwestern United States and other major agricultural areas of~~ the United States, Canada and the United ~~Kingdom.~~Kingdom, and distribute plant nutrients through a system of terminals, warehouses, and associated transportation equipment located primarily in the Midwestern United States. We also export nitrogen fertilizer products from our Donaldsonville, Louisiana and Yazoo City, Mississippi manufacturing facilities, and our United Kingdom manufacturing facilities in Billingham and Ince.

Our principal assets include:

On February 7, 2018, we announced that Terra Nitrogen GP Inc. (TNGP), the sole general partner of TNCLP and an indirect wholly owned subsidiary of CF Holdings, elected to exercise its right to purchase all of the 4,612,562 publicly traded common units of TNCLP on April 2, 2018, for a cash purchase price of $84.033 per unit in accordance with the terms of TNCLP’s partnership agreement. The purchase price of $84.033 per unit was determined under the terms of TNCLP’s partnership agreement as the average of the daily closing prices per common unit for the 20 consecutive trading days beginning with January 5, 2018 and ending with February 2, 2018. The purchase price of all of the 4,612,562 publicly traded common units of TNCLP is approximately $390 million. We intend to fund the purchase with cash on hand. As of the April 2, 2018 purchase date, all rights of the holders of the units will terminate, with the exception of the right to receive payment of the purchase price. Upon completion of the purchase, we will own 100 percent of the general and limited partnership interests of TNCLP, and the common units representing limited partner interests will cease to be publicly traded or listed on the New York Stock Exchange.

In 2016, we completed our capacity expansion projects at Donaldsonville, Louisiana and Port Neal, Iowa. These projects, originally announced in 2012, included the construction of new ammonia, urea, and UAN plants at our Donaldsonville,

We commenced a strategic venture with CHS on February 1, 2016, at which time CHS purchased a minority equity interest in CFN for $2.8 ~~billion.~~billion, which represented approximately 11% of the membership interest of CFN. We own the remaining membership interest. On February 1, 2016, CHS also began receiving deliveries pursuant to a supply agreement under which CHS has the right to purchase annually from CFN up to approximately 1.1 million tons of granular urea and 580,000 tons of UAN at market prices. As a result of its minority equity interest in CFN, CHS is entitled to semi-annual cash distributions from CFN. We are also entitled to semi-annual cash distributions from CFN. See Note ~~17—~~16—Noncontrolling Interests for additional information on our strategic venture with CHS.

On July 31, 2015, we acquired the remaining 50% equity interest in CF Fertilisers UK Group Limited (formerly known as GrowHow UK Group Limited) (CF Fertilisers UK) not previously owned by us for total consideration of $570 million, and CF Fertilisers UK became wholly owned by us. This transaction added CF Fertilisers UK’s nitrogen manufacturing complexes in Ince, United Kingdom and Billingham, United Kingdom to our consolidated manufacturing capacity.

Our principal executive offices are located outside of Chicago, Illinois, at 4 Parkway North, Suite 400, Deerfield, Illinois 60015, and our telephone number is 847-405-2400. Our Internet website address is www.cfindustries.com. Information made available on our website does not constitute part of this Annual Report on Form 10-K.

We make available free of charge on or through our Internet website, www.cfindustries.com, all of our reports on Forms 10-K, 10-Q and 8-K and all amendments to those reports as soon as reasonably practicable after such material is filed electronically with, or furnished to, the Securities and Exchange Commission (SEC). Copies of our Corporate Governance Guidelines, Code of Corporate Conduct and charters for the Audit Committee, Compensation Committee, and Corporate Governance and Nominating Committee of our Board of Directors (the Board) are also available on our Internet website. We will provide electronic or paper copies of these documents free of charge upon request. The SEC also maintains a website at www.sec.gov that contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC.

We were founded in 1946 as a fertilizer brokerage operation by a group of regional agricultural cooperatives. During the 1960s, we expanded our distribution capabilities and diversified into fertilizer manufacturing through the acquisition of several existing plants and facilities. During the 1970s and again during the 1990s, we expanded our production and distribution capabilities significantly, spending approximately $1 billion in each of these decades.

We operated as a traditional manufacturing and supply cooperative until 2002, when we adopted a new business model that established financial performance as our principal objective, rather than assured supply to our owners. A critical aspect of the new business model was to establish a more economically driven approach to the marketplace.

In August 2005, we completed our initial public offering (IPO) of common stock, which is listed on the New York Stock Exchange. In connection with the IPO, we consummated a reorganization transaction whereby we ceased to be a cooperative

In April 2010, we acquired Terra Industries Inc. (Terra), a leading North American producer and marketer of nitrogen fertilizer products for a purchase price of $4.6 billion, which was paid in cash and shares of our common stock. As a result of the Terra acquisition, we acquired five nitrogen fertilizer manufacturing facilities, our approximately 75.3% interest in TNCLP and certain joint venture interests.

In ~~April 2013, we purchased the remaining noncontrolling interest in Canadian Fertilizers Limited (CFL).~~

In July 2015, we acquired the remaining 50% equity interest in CF Fertilisers UK not previously owned by us for total consideration of $570 million, and CF Fertilisers UK became wholly owned by us.

In February 2016, our strategic venture with CHS commenced, at which time CHS purchased a minority equity interest in CFN for $2.8 billion.

In 2016, we completed capacity expansion projects at Donaldsonville, Louisiana and Port Neal, Iowa which increased our production capacity by 25% for a total capital cost of $5.2 billion.

On February 7, 2018, we announced that TNGP elected to exercise its right to purchase all of the 4,612,562 publicly traded common units of TNCLP on April 2, 2018, for a cash purchase price of $84.033 per unit in accordance with the terms of TNCLP’s partnership agreement. The purchase price of all of the 4,612,562 publicly traded common units of TNCLP is approximately $390 million. Upon completion of the purchase, we will own 100 percent of the general and limited partnership interests of TNCLP.

We own and operate seven nitrogen fertilizer manufacturing facilities in North America, including five nitrogen fertilizer manufacturing facilities in the United States, one in Medicine Hat, Alberta, Canada and one in Courtright, Ontario, Canada. As of December 31, ~~2016,~~2017, the combined production capacity of these seven facilities represented approximately 42%, 43%, ~~50%, 48%~~ 44%

We also operate two United Kingdom nitrogen manufacturing complexes located in Ince and Billingham that produce ammonia, AN and NPKs and serve primarily the British agricultural and industrial markets.

The following table shows the production capacities as of December 31, ~~2016~~2017 at each of our nitrogen manufacturing facilities:

The Donaldsonville nitrogen fertilizer complex is the world's largest nitrogen fertilizer production facility. It has six ammonia plants, five urea plants, four nitric acid plants, ~~and~~ three UAN ~~plants.~~plants, and one DEF plant. The complex, which is located on the Mississippi River, includes deep-water docking facilities, access to an ammonia pipeline, and truck and railroad loading capabilities. The complex has on-site storage for 160,000 tons of ammonia, 201,000 tons of UAN (measured on a 32% nitrogen content basis) and 173,000 tons of granular urea.

As part of our capacity expansion projects, the new Donaldsonville urea plant became operational during the fourth quarter of 2015. The new UAN plant was placed in service in the first quarter of 2016, and the new ammonia plant was placed in service in October 2016. For additional details regarding the capacity expansion projects, see Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital ~~Resources—Capacity Expansion Projects and Restricted Cash.~~Resources.

Medicine Hat is the largest nitrogen fertilizer complex in Canada. It has two ammonia plants and one urea plant. The complex has on-site storage for 60,000 tons of ammonia and 60,000 tons of granular urea.

The Port Neal facility is located approximately 12 miles south of Sioux City, Iowa on the Missouri River. The facility consists of two ammonia plants, three urea plants, two nitric acid plants and a UAN plant. The location has on-site storage for 90,000 tons of ammonia, 154,000 tons of granular urea, and 81,000 tons of 32% UAN.

As part of our capacity expansion projects, both the ammonia and urea plants were placed in service in December 2016. For additional details regarding the capacity expansion projects, see Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital ~~Resources—Capacity Expansion Projects and Restricted Cash.~~Resources.

The Verdigris facility is located northeast of Tulsa, Oklahoma, near the Verdigris River and is owned by TNLP. It is the second largest UAN production facility in North America. The facility comprises two ammonia plants, two nitric acid plants, two UAN plants and a port terminal. Through our approximately 75.3% interest in TNCLP and its subsidiary, TNLP, we operate the plants and lease the port terminal from the Tulsa-Rogers County Port Authority. The complex has on-site storage for 60,000 tons of ammonia and 100,000 tons of 32% UAN.

The Woodward facility is located in rural northwest Oklahoma and consists of an ammonia plant, two nitric acid plants, two urea plants and two UAN plants. The facility has on-site storage for 36,000 tons of ammonia and 84,000 tons of 32% UAN.

The Yazoo City facility is located in central Mississippi and includes one ammonia plant, four nitric acid plants, an AN plant, two urea plants, a UAN plant and a dinitrogen tetroxide production and storage facility. The site has on-site storage for 50,000 tons of ammonia, 48,000 tons of 32% UAN and 11,000 tons of AN and related products.

The Courtright facility is located south of Sarnia, Ontario near the St. Clair River. The facility consists of an ammonia plant, a UAN plant, a nitric acid plant and a urea plant. The location has on-site storage for 64,000 tons of ammonia, 10,400 tons of granular urea and 16,000 tons of 32% UAN.

The Ince facility is located in northwestern England and consists of an ammonia plant, three nitric acid plants, an AN plant and three NPK plants. The location has on-site storage for 11,000 tons of ammonia, ~~110,000~~95,000 tons of AN, and ~~50,000~~40,000 tons of NPKs.

The Billingham facility, located in the Teesside chemical area in northeastern England, is geographically split among three primary locations: the main site, which contains an ammonia plant, three nitric acid plants and a carbon dioxide plant; the Portrack site, approximately two miles away, which contains an AN fertilizer plant; and the North Tees site, approximately seven miles away, which contains an ammonia storage area. These locations collectively have on-site storage for 40,000 tons of ammonia and 128,000 tons of AN.

The Point Lisas Nitrogen facility in the Republic of Trinidad and Tobago is owned jointly through a 50/50 venture with Koch Fertilizer LLC. This facility has the capacity to produce 720,000 tons of ammonia annually from natural gas supplied under a contract with the National Gas Company of Trinidad and Tobago (NGC).

Natural gas is the principal raw material and primary fuel source used in the ammonia production process at our nitrogen fertilizer manufacturing facilities. In ~~2016,~~2017, natural gas accounted for approximately 47% of our total production costs for nitrogen fertilizer products. Our nitrogen fertilizer manufacturing facilities have access to abundant, competitively-priced natural gas through a reliable network of pipelines that are connected to major natural gas trading hubs near the facilities. Our facilities utilize the following natural gas hubs: Henry Hub in Louisiana; SONAT in Louisiana; TETCO ELA in Louisiana; ONEOK in Oklahoma; AECO in Alberta; Ventura in Iowa; Demarcation in Kansas; Welcome in Minnesota; Dawn in Ontario; Parkway in Ontario; and the National Balancing Point (NBP) in the United Kingdom.

In ~~2016,~~2017, our nitrogen manufacturing facilities consumed, in the aggregate, approximately ~~295~~356 million MMBtus of natural gas. In 2017, the amount of natural gas consumed by our nitrogen manufacturing facilities ~~will increase~~increased as a result of the completion of our capacity expansion projects. We employ a combination of spot and term purchases from a variety of quality suppliers to maintain a reliable, competitively-priced supply of natural gas. We also use certain financial instruments to hedge natural gas prices. See Note ~~15—~~14—Derivative Financial Instruments for additional information about our natural gas hedging activities.

The safe, efficient and economical distribution of nitrogen fertilizer products is critical for successful operations. Our nitrogen fertilizer production facilities have access to multiple transportation modes by which we ship fertilizer products to terminals, warehouses and customers. Each of our production facilities has a unique distribution pattern based on its production capacity and location.

Our North American nitrogen production facilities can ship products via truck and rail to customers and our storage facilities in the U.S. and Canada, with access to our leased railcar fleet of approximately ~~5,700~~5,000 tank and hopper cars, as well as railcars provided by rail carriers. Our United Kingdom nitrogen production facilities mainly ship products via truck.

The North American waterway system is also used extensively to ship products from our Donaldsonville, Verdigris and Yazoo City facilities. To ship ammonia and UAN, we employ a fleet of ten tow boats and thirty-two river barges, which are

Three of our nitrogen production facilities also have access to pipelines for the transportation of ammonia. The Donaldsonville facility is connected to the 2,000-mile long Nustar pipeline through which we have the ability to transport ammonia to more than 20 terminals and shipping points in the midwestern U.S. corn belt. Our Verdigris and Port Neal facilities are connected to the 1,100-mile long Magellan ammonia pipeline that also serves the ~~U.S. Midwest.~~Midwestern United States.

As of December 31, ~~2016,~~2017, we owned or leased space at 9162 in-market storage terminals and warehouses located in a ~~23-state~~22-state region of the United States, Canada and the United Kingdom. Including storage at our production facilities, we have an aggregate storage capacity for approximately ~~3.7~~3.5 million tons of fertilizer. Our storage capabilities are summarized in the following table.

The principal customers for our nitrogen fertilizer and other nitrogen products are cooperatives, independent fertilizer distributors, farmers and industrial users. CHS was our largest customer in ~~2016~~2017 and accounted for approximately ~~12%~~11% of our consolidated net sales. Sales are generated by our internal marketing and sales force.

Our markets are global and intensely competitive, based primarily on delivered price and, to a lesser extent, on customer service and product quality. During the peak demand periods, product availability and delivery time also play a role in the buying decisions of customers.

Our primary North American-based competitors include Nutrien Ltd. (formed in January 2018 by the merger of Agrium Inc.~~, Koch Fertilizer LLC~~ and Potash Corporation of Saskatchewan Inc. ~~Additionally,~~), Koch Fertilizer LLC and Iowa Fertilizer ~~Company and~~Company. Additionally, Yara BASF ~~are~~is expected to bring a new North American nitrogen fertilizer production ~~facilities~~facility on line in ~~2017.~~2018. There is also significant competition from products sourced from other regions of the world, including some with lower natural gas or other feedstock costs. Because ammonia, urea and UAN are widely-traded fertilizer products and there are limited barriers to entry, we experience competition from foreign-sourced products continuously.

Our primary United Kingdom competition comes from imported products supplied by companies including Yara International, Origin Fertilisers, ~~Bunn Fertiliser Limited (Koch),~~ Ameropa, CHS and Helm. Urea and UAN are not produced in the United Kingdom, but along with AN are widely-traded fertilizer products with limited barriers to entry.

The fertilizer business is seasonal. The degree of seasonality of our business can change significantly from year to year due to conditions in the agricultural industry and other factors. The strongest demand for our products in North America occurs during the spring planting season, with a second period of strong demand following the fall harvest. We and our customers generally build inventories during the low demand periods of the year to ensure timely product availability during the peak sales seasons. Seasonality is greatest for ammonia due to the short application season and the limited ability of our customers and their customers to store significant quantities of this product. The seasonality of fertilizer demand generally results in our sales volumes and net sales being the highest during the spring and our working capital requirements being the highest just prior to the start of the spring planting season. Our quarterly financial results can vary significantly from one year to the next due to weather-related shifts in planting schedules and purchasing patterns.

The amount of net sales attributable to our sales to foreign and domestic markets over the last three fiscal years and the carrying value of our foreign and domestic long-lived assets are set forth in Note ~~21—~~20—Segment Disclosures.

We are subject to numerous environmental, health and safety laws and regulations in the United States, Canada, the United Kingdom and the Republic of Trinidad and Tobago, including laws and regulations relating to the generation and handling of hazardous substances and wastes; the cleanup of hazardous substance releases; the discharge of regulated substances to air or water; and the demolition of existing plant sites upon permanent closure. In the United States, these laws include the Clean Air Act, the Clean Water Act, the Resource Conservation and Recovery Act (RCRA), the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA), the Toxic Substances Control Act (TSCA) and various other federal, state, provincial, local and international statutes. Violations of environmental, health and safety laws can result in substantial penalties, court orders to install pollution-control equipment, civil and criminal sanctions, permit revocations and facility shutdowns. In addition, environmental, health and safety laws and regulations may impose joint and several liability, without regard to fault, for cleanup costs on potentially responsible parties who have released or disposed of hazardous substances into the environment. We may be subject to more stringent enforcement of existing or new environmental, health and safety laws in the future.

Our environmental, health and safety capital expenditures in ~~2016~~2017 totaled approximately ~~$29~~$21 million. We estimate that we will have approximately ~~$37~~$60 million of capital expenditures for environmental, health and safety in ~~2017.~~2018. Environmental, health and safety laws and regulations are complex, change frequently and have tended to become more stringent over time. We expect that continued government and public emphasis on environmental issues will result in increased future expenditures for environmental controls at our operations. Such expenditures could have a material adverse effect on our business, financial condition, results of operations and cash flows. Additionally, future environmental, health and safety laws and regulations or reinterpretation of current laws and regulations may require us to make substantial expenditures. Our costs to comply with, or any liabilities under, these laws and regulations could have a material adverse effect on our business, financial condition, results of operations and cash flows.

From time to time, we receive notices from governmental agencies or third parties alleging that we are a potentially responsible party at certain cleanup sites under CERCLA or other environmental cleanup laws. In 2011, we received a notice from the Idaho Department of Environmental Quality (IDEQ) that alleged that we were a potentially responsible party for the cleanup of a former phosphate mine we owned in the late 1950s and early 1960s located in Georgetown Canyon, Idaho. The current owner of the property and a former mining contractor received similar notices for the site. We and the current owner are currently conducting a remedial investigation/feasibility study of the site. In 2015, we and several other parties received a notice that the U.S. Department of Interior and other trustees intend to undertake a natural resource damage assessment for a group of former phosphate mines in southeast Idaho, including the former Georgetown Canyon mine. See Note ~~20—~~19—Contingencies for additional information on the CERCLA/Remediation matters.

We are subject to regulations in the United Kingdom, Canada and the United States concerning greenhouse gas (GHG) emissions.

The United Kingdom has adopted GHG emissions regulations, including regulations to implement the European Union Greenhouse Gas Trading System. Our U.K. manufacturing plants are required to report GHG emissions annually to the United Kingdom Environment Agency pursuant to their site Environmental Permits and Climate Change Agreement, which specify energy efficiency targets. Failure to meet efficiency targets may require these plants to purchase CO2 emissions allowances. The steam boilers at each of our U.K. sites are also subject to the European Union Emissions Trading Scheme.

Canada withdrew from further participation in the Kyoto Protocol in December 2011, but is a party to the Paris Agreement. In Canada, we are required to conduct an annual review of our operations with respect to compliance with

Ontario is party to the Western Climate Initiative (WCI), comprising California and several Canadian provinces. On January 1, 2017, Ontario launched its own GHG cap and trade program. Under this program, the Ontario government will set a hard limit on emissions, which will steadily decline annually. By 2020, the cap will mandate that GHG emissions decline by 15% compared to 1990 levels. Facilities that generate more than 25,000 tonnes of GHG emissions per year will be required to participate in the cap and trade program and will require emissions allowances for every

In Alberta, the Specified Gas Emitters Regulation (GHG Regulation) was implemented in 2007. This program ~~requires~~required facilities emitting more than 100,000 tons of GHGs per year to reduce emissions by 12% over such facilities' 2007 levels. To meet this requirement, companies ~~can~~could reduce emissions, purchase/use offset credits, or contribute to a technology fund at an annual rate of $15 per ton of CO2. ~~Currently,~~Beginning in 2018, our ~~Medicine Hat facility’s method of compliance is~~facility will become subject to the Carbon Competitiveness Incentive Regulation, which establishes product-specific benchmarks based on the most efficient GHG emitting facilities in a sector. Similar to the existing regulation, a facility that exceeds the applicable benchmark will be required to take action to reduce its GHG emissions intensity, purchase emissions offsets or performance credits, or make contributions to ~~the technology~~Alberta's climate fund. ~~In June 2016, Alberta promulgated the Climate Leadership Implementation Act, which will impose~~The obligations under this regulation are being phased in over a ~~wide-ranging carbon tax. The carbon tax~~three year period and will be set at $20 per ton (Canadian dollars) effective January 1, 2017, rise to $30 per ton (Canadian dollars) effective January 1, 2018 and increase with the rate of inflation thereafter. Facilities such as ours that are subject to the existing specified gas emitters regulation will continue to be subject to this regulation in the near term, after which new product and sector-based performance standards (to be developed) will become effective.tightened over time.

The United States is not a party to the Kyoto Protocol, but is a party to the Paris Agreement. However, ~~as a result of the recent presidential election,~~in June 2017, the United States ~~may decide~~announced its intention to withdraw from the Paris Agreement, ~~(or~~subject to renegotiation of the Paris Agreement on terms more favorable to the United ~~Nations Framework Convention on Climate Change,~~States. Under the terms of the Paris Agreement, the United States cannot formally provide notice of its withdrawal before November 2019, which would ~~also result in withdrawal from~~become effective one year after providing such notice. In the ~~Paris Agreement) or, prior to taking such actions, could disregard~~interim, it is unclear if the United States will comply with its commitments under the Paris Agreement. ~~The impact of such actions, if they take place, on~~There has been no indication to date that the ~~future implementation of~~United States' announced withdrawal is causing other countries to also consider withdrawing from the Paris ~~Agreement is uncertain.~~Agreement. In the United States, GHG regulation is evolving at state, regional and federal levels, although some of the more significant developments to date, including EPA's Clean Power Plan, do not directly impose obligations on our facilities. The EPA has issued a mandatory GHG reporting rule that required all of our U.S. manufacturing facilities to commence monitoring GHG emissions beginning on January 1, 2010 and report the previous year's emissions annually starting in 2011. In addition, if we seek to modify or expand any of our major facilities and as a result, are required to obtain a Prevention of Significant Deterioration (PSD) construction permit applicable to such facilities, we could be subject to pollution control requirements applicable to GHGs in addition to requirements applicable to conventional air pollutants. Such requirements may result in increased costs or delays in completing such projects. Other than the states' implementation of this permitting requirement, none of the states where our U.S. production facilities are located—Iowa, Louisiana, Mississippi and Oklahoma—has proposed control regulations limiting GHG emissions.

We operate 14 nitric acid plants in the United States. On August 14, 2012, the EPA issued a final regulation revising air emission standards applicable to newly constructed, reconstructed or modified nitric acid plants. The regulations will apply to these plants if and when we undertake activities or operations that are considered modifications, including physical changes that would allow us to increase our production capacity at these plants. The regulations include certain provisions that could make it difficult for us to meet the limits on emissions of nitrogen oxides (NOx) notwithstanding pollution controls we may add to our plants, and accordingly, the regulations could impact our ability to expand production at our existing plants. The EPA regulation did not include a limitation on emissions of nitrous oxide (a greenhouse gas).

We hold numerous environmental and other governmental permits and approvals authorizing operations at each of our facilities. A decision by a government agency to deny or delay issuing a new or renewed regulatory material permit or approval, or to revoke or substantially modify an existing material permit or approval, could have a material adverse effect on our ability to continue operations at the affected facility. Any future expansion of our existing operations is also predicated upon securing the necessary environmental or other permits or approvals. More stringent environmental standards may impact our ability to obtain such permits. On December 15, 2016, the EPA re-designated the Greater Baton Rouge Nonattainment Area (BRNA), where our Donaldsonville facility is located, to attainment with the 2008 8-hour ozone standard. However, on October 26, 2015, the EPA published a more stringent national ambient air quality standard for ozone. The State of Louisiana has recommended to the EPA that Baton Rouge be designated as nonattainment with the 2015 ozone standard. On December 20, 2017, the EPA notified the State of Louisiana that it intends to designate the Baton Rouge area as non-attainment for the 2015 ozone standard. On January 5, 2018, the EPA published notice of a public comment period with respect to the proposed attainment/non-attainment designations of certain air quality regions, including the Baton Rouge area. Such a classification (in the Baton Rouge area or in other areas where our manufacturing facilities are located) could result in more stringent air pollution emissions limits for our existing operations and would also subject our facilities to more stringent requirements to obtain approvals for plant expansions, or could make it difficult to obtain such approvals. ~~The EPA is supposed to designate areas under the 2015 standard by October 2017.~~

As of December 31, ~~2016,~~2017, we employed approximately 2,900 full-time and 100 part-time employees.

None.

Information regarding our facilities and properties is included in ~~Part I,~~ Item 1. Business—Reportable Segments and ~~Part I,~~ Item 1. Business—Storage Facilities and Other Properties.

We received a Notice of Violation (NOV) from the EPA by letter dated June 16, 2010, alleging that we violated the Prevention of Significant Deterioration Clean Air Act regulations relating to certain projects undertaken at the former Plant City, Florida facility's sulfuric acid plants. This NOV further alleges that the actions that are the basis for the alleged PSD violations also resulted in violations of Title V air operating permit regulations. Finally, the NOV alleges that we failed to comply with certain compliance dates established by hazardous air pollutant regulations for phosphoric acid manufacturing plants and phosphate fertilizer production plants. We had several meetings with the EPA with respect to this matter prior to our sale of the phosphate mining and manufacturing business in March 2014. We and Mosaic have separately had continued discussions with the EPA subsequent to our sale of the phosphate mining and manufacturing business with respect to this matter. We do not know at this time if this matter will be settled prior to initiation of formal legal action.

We cannot estimate the potential penalties, fines or other expenditures, if any, that may result from the Clean Air Act NOV and, therefore, we cannot determine if the ultimate outcome of this matter will have a material impact on our consolidated financial position, results of operations or cash flows.

By letter dated July 6, 2010, the EPA issued a NOV to us alleging violations of Section 313 of the Emergency Planning and Community Right-to-Know Act (EPCRA) in connection with the former Plant City facility. EPCRA requires annual reports to be submitted with respect to the use of certain toxic chemicals. The NOV also included an allegation that we violated Section 304 of EPCRA and Section 103 of CERCLA by failing to file a timely notification relating to the release of hydrogen fluoride above applicable reportable quantities. We do not know at this time if this matter will be settled prior to initiation of formal legal action.

We do not expect that penalties or fines, if any, that may arise out of the EPCRA/CERCLA matter will have a material impact on our consolidated financial position, results of operations or cash flows.

For information on pending proceedings relating to environmental remediation matters, see Item 1. Business—Environmental, Health and Safety and Note ~~20—Contingencies.~~19—Contingencies to our consolidated financial statements included in Item 8 of this report.

Our common stock is traded on the New York Stock Exchange, Inc. (NYSE) under the symbol "CF". Quarterly high and low sales prices, as reported by the NYSE, are provided below:

As of February ~~16, 2017,~~15, 2018, there were ~~779~~753 stockholders of record.

The following table sets forth stock repurchases for each of the three months of the quarter ended December 31, ~~2016.~~2017.

We are one of the largest manufacturers and distributors of nitrogen fertilizer products and other nitrogen products in the world. Our principal customers are cooperatives, independent fertilizer distributors, farmers and industrial users. Our principal nitrogen fertilizer products are ammonia, granular urea, urea ammonium nitrate solution (UAN) and ammonium nitrate (AN). Our other nitrogen products include diesel exhaust fluid (DEF), urea liquor, nitric acid and aqua ammonia, which are sold primarily to our industrial customers, and compound fertilizer products (NPKs), which are solid granular fertilizer products for which the nutrient content is a combination of nitrogen, phosphorus and potassium. We operate world-class nitrogen manufacturing complexes in Canada, the United Kingdom and the United States, and distribute plant nutrients through a system of terminals, warehouses, and associated transportation equipment located primarily in the Midwestern United States. We also export nitrogen fertilizer products from our Donaldsonville, Louisiana and Yazoo City, Mississippi manufacturing facilities, and our United Kingdom manufacturing facilities in Billingham and Ince.

Our principal assets include:

On February 7, 2018, we announced that Terra Nitrogen GP Inc. (TNGP), the sole general partner of TNCLP and an indirect wholly owned subsidiary of CF Holdings, elected to exercise its right to purchase all of the 4,612,562 publicly traded common units of TNCLP on April 2, 2018, for a cash purchase price of $84.033 per unit in accordance with the terms of TNCLP’s partnership agreement. The purchase price of $84.033 per unit was determined under the terms of TNCLP’s partnership agreement as the average of the daily closing prices per common unit for the 20 consecutive trading days beginning with January 5, 2018 and ending with February 2, 2018. The purchase price of all of the 4,612,562 publicly traded common units of TNCLP is approximately $390 million. We intend to fund the purchase with cash on hand. As of the April 2, 2018 purchase date, all rights of the holders of the units will terminate, with the exception of the right to receive payment of the purchase price. Upon completion of the purchase, we will own 100 percent of the general and limited partnership interests of TNCLP, and the common units representing limited partner interests will cease to be publicly traded or listed on the New York Stock Exchange.

We operate in a highly competitive, global industry. Our operating results are influenced by a broad range of factors, including those outlined below.

Our products are globally traded commodities and are subject to price competition. The customers for our products make their purchasing decisions principally on the basis of delivered price and, to a lesser extent, on customer service and product quality. The selling prices of our products fluctuate in response to global market conditions, changes in supply and demand and different cost factors.

Historically, global fertilizer demand has been driven primarily by population growth, gross domestic product growth, changes in dietary habits, planted acreage, and application rates, among other things. We expect these key variables to continue to have major impacts on long-term fertilizer demand for the foreseeable future. Short-term fertilizer demand growth may depend on global economic conditions, weather patterns, the level of global grain stocks relative to consumption, governmental regulations, including fertilizer subsidies or requirements mandating increased use of bio-fuels or industrial nitrogen products and farm sector income. Other geopolitical factors like temporary disruptions in fertilizer trade related to government intervention or changes in the buying/selling patterns of key exporting/consuming countries such as China, India, Russia and Brazil, among others, often play a major role in shaping near-term market fundamentals. The economics of nitrogen-based fertilizer manufacturing play a key role in decisions to increase or reduce production capacity. Supply of fertilizers is generally driven by available capacity and operating rates, raw material costs and availability, government policies and global trade. Raw materials are dependent on energy sources such as natural gas or coal; supply costs are affected by the supply of and demand for these commodities.

Over the last decade, strong demand, high capacity utilization and increasing operating margins as a result of higher global nitrogen fertilizer prices stimulated global investment in nitrogen production facilities, which resulted in an increase in global nitrogen fertilizer production capacity. As a result, global nitrogen fertilizer capacity increased faster than global nitrogen fertilizer demand, creating a surplus of global nitrogen capacity in the market, and leading to lower nitrogen fertilizer selling prices. In addition, global feedstock commodity prices declined, including coal and oil-linked gas, contributing to the lower nitrogen fertilizer prices.

In addition to the relationship between global supply and demand, profitability within a particular geographic region is determined by the supply/demand balance within that region. Regional supply and demand can be influenced significantly by factors affecting trade within regions. Some of these factors include the relative cost to produce and deliver product, relative currency values, the availability of credit and governmental trade policies. The development of additional natural gas reserves in North America over the last decade has decreased natural gas costs relative to the rest of the world, making North American nitrogen fertilizer producers more competitive. These lower natural gas costs contributed to announcements of several nitrogen fertilizer capacity expansion projects in North America, including our capacity expansion projects in Donaldsonville, Louisiana and Port Neal, Iowa, which were completed in December 2016. Changes in currency values may also alter our cost competitiveness relative to producers in other regions of the world.

Imports account for a significant portion of the nitrogen fertilizer consumed in North America. Producers of nitrogen-based fertilizers located in the Middle East, Ukraine, the Republic of Trinidad and Tobago, Venezuela, North Africa, Russia and China have been major exporters to North America.

The demand for fertilizer is affected by the aggregate crop planting decisions and fertilizer application rate decisions of individual farmers. Individual farmers make planting decisions based largely on prospective profitability of a harvest, while the specific varieties and amounts of fertilizer they apply depend on factors like their current liquidity, soil conditions, weather patterns, crop prices and the types of crops planted.

On December 22, 2017, the U.S. government enacted the Tax Cuts and Jobs Act (the "Tax Act" or "Tax Reform") which includes a number of changes to U.S. tax law that affect us. As a result of the Tax Act we recognized a $491 million income tax benefit, which has a significant impact on our 2017 financial results. This impact generally results from the following two major provisions:

A significant amount of new nitrogen production capacity came on line in 2016 and 2017, including an increase in production capacity located in North America, which has further increased supply. Additional production capacity is expected to come on line in 2018. As a result, we expect the lower priced environment to continue until global supply and demand become more balanced through a combination of continued demand growth and supply reductions as producers respond to lower realized margins by taking higher cost production facilities off line.

The U.S. Gulf is a major global fertilizer pricing point due to the volume of nitrogen fertilizer that trades there. Through most of 2016, nitrogen pricing at the U.S. Gulf declined, often trading below parity with other international pricing points due to continued imports from various exporting regions and delayed North American buyer interest as a result of greater global nitrogen supply availability. Seasonal decreases in agricultural demand combined with delayed customer purchasing activity resulted in multi-year lows in nitrogen fertilizer selling prices in the second half of 2016. Early in the first quarter of 2017, prices began to increase as the supply and demand balance tightened in anticipation of spring fertilizer demand for the planting and growing season. However, as the first quarter progressed, increased imports into North America increased fertilizer supply in the region, which pressured selling prices downward as the quarter ended. During the second quarter of 2017, excess supply through imports into the United States that occurred in the first quarter of 2017 continued in the second quarter, negatively impacting selling prices. During the third quarter of 2017, prices hit yearly lows and then selling prices for most nitrogen products increased throughout the quarter, ending higher than at the beginning of the quarter, driven by significantly lower Chinese exports, higher energy and production costs in parts of the world, a weaker U.S. dollar and strong global demand. During the fourth quarter of 2017, certain announced nitrogen industry capacity additions that were expected to occur, were delayed, and certain maintenance outages all led to a favorable supply demand balance and contributed to a rise in nitrogen pricing.

The significant price fluctuations we have experienced in 2017 are symptoms of a market in transition as new capacity comes on line and global trade flows adjust, and this transition is not complete. We expect the final set of North American capacity additions to come fully on line by mid-2018. Should imports of nitrogen products into North America continue at high rates, the oversupply in the region will continue, which could lead to lower prices, similar to those experienced in early 2017. New global nitrogen capacity additions coming on line after 2018 are expected to be lower than recent years, which will support the market transition or more balanced supply and demand.

The greater global nitrogen supply availability and resulting low nitrogen fertilizer selling prices significantly impacted our results. The average selling price for our products for 2017, 2016 and 2015 was $207 per ton, $217 per ton and $314 per ton, respectively. The decline in average selling prices from 2016 to 2017 reduced net sales by $293 million, while the decline in average selling prices from 2015 to 2016 reduced net sales by $1.4 billion. In addition to the direct impact of lower selling prices, during periods of declining prices, customers tend to delay purchasing fertilizer in anticipation of prices in the future being lower than current prices.

The following describes the significant items that impacted the comparability of our financial results in 2017, 2016 and 2015. Descriptions of items below that refer to amounts in the table above, refer to the pre-tax amounts.

Total depreciation and amortization expense recognized in 2017, 2016 and 2015 was $883 million, $678 million and $480 million, respectively. This increase in depreciation expense reflects the completion of our capacity expansion projects and placing in service all five of the new plants prior to the end of 2016. The capacity expansion projects were originally announced in 2012 and included the construction of new ammonia, urea, and UAN plants at our Donaldsonville, Louisiana complex and new ammonia and urea plants at our Port Neal, Iowa complex. These plants increased our overall production capacity by approximately 25%, improved our product mix flexibility at Donaldsonville, and improved our ability to serve upper-Midwest urea customers from our Port Neal location. The following table indicates the quarter in which each of the five expansion plants were placed in service.

Depreciation expense pertaining to each of our capacity expansion plants commenced once the applicable plant was placed in service.

Natural gas is typically the largest and most volatile single component of the manufacturing cost for nitrogen-based products. We manage the risk of changes in natural gas prices through the use of derivative financial instruments. The derivatives that we use for this purpose are primarily natural gas fixed price swaps and natural gas options. We use natural gas derivatives as an economic hedge of natural gas price risk, but without the application of hedge accounting. This can result in volatility in reported earnings due to the unrealized mark-to-market adjustments that occur from changes in the value of the derivatives, which is reflected in cost of sales in our consolidated statements of operations. In 2017, 2016 and 2015, we recognized unrealized net mark-to-market losses (gains) on natural gas derivatives of $61 million, $(260) million and $176 million, respectively.

In 2017, 2016 and 2015, we recognized losses (gains) of $2 million, $93 million and $(8) million, respectively, from the impact of changes in foreign currency exchange rates on primarily British pound and Canadian dollar denominated intercompany loans that were not permanently invested.

The Trinidad tax authority (the Board of Inland Revenue) has issued a tax assessment against our equity method investment in the Republic of Trinidad and Tobago, PLNL, related to a dispute over whether tax depreciation must be claimed during a tax holiday period that was granted to PLNL under the Trinidad Fiscal Incentives Act. The tax holiday was granted as an incentive to construct PLNL’s ammonia plant. Based on the facts and circumstances of this matter, PLNL recorded a tax contingency accrual, which reduced our equity in earnings of PLNL for 2017 by approximately $7 million reflecting our 50% ownership interest. In early 2018, PLNL settled this matter with the Board of Inland Revenue for the amounts accrued.

We commenced a strategic venture with CHS on February 1, 2016, at which time CHS purchased a minority equity interest in CFN for $2.8 billion. CHS also began receiving deliveries pursuant to a supply agreement under which CHS has the right to purchase annually from CFN up to approximately 1.1 million tons of granular urea and 580,000 tons of UAN at market prices. As a result of its minority equity interest in CFN, CHS is entitled to semi-annual cash distributions from CFN. We are also entitled to semi-annual cash distributions from CFN. The amounts of distributions from CFN to us and CHS are based generally on the profitability of CFN and determined based on the volume of granular urea and UAN sold by CFN to us and CHS pursuant to supply agreements, less a formula driven amount based primarily on the cost of natural gas used to produce the granular urea and UAN, and adjusted for the allocation of items such as operational efficiencies and overhead amounts.

We began recognizing the noncontrolling interest pertaining to CHS’ ownership interest in CFN on February 1, 2016. During 2017 and 2016, we recognized earnings attributable to the noncontrolling interest in CFN of $73 million and

Under the terms of our strategic venture with CHS, if our credit rating as determined by two of three specified credit rating agencies is below certain levels, we are required to make a non-refundable yearly payment of $5 million to CHS. Since our credit ratings were below certain levels in 2016 and 2017, we made a payment of $5 million to CHS in each year. These payments will continue on a yearly basis until the earlier of the date that our credit rating is upgraded to or above certain levels by two of three specified credit rating agencies or February 1, 2026. This obligation is recognized on our consolidated balance sheets as an embedded derivative. During 2017 and 2016, included in other operating—net in our consolidated statements of operations is a net loss of $4 million and $23 million, respectively.

In the fourth quarter of 2016, due to the uncertain duration of the prevailing low nitrogen fertilizer selling price environment and in order to provide liquidity and covenant flexibility for the future, we took certain steps with respect to the Revolving Credit Agreement and our senior notes due 2022, 2025 and 2027 (the Private Senior Notes). On November 21, 2016, we prepaid the $1.0 billion aggregate principal amount of the Private Senior Notes, and paid the related make-whole amount of approximately $170 million. We made the prepayment and make-whole payment using the proceeds from an offering of $1.25 billion aggregate principal amount of senior secured notes consisting of $500 million aggregate principal amount of senior secured notes due 2021 and $750 million aggregate principal amount of senior secured notes due 2026 (collectively referred to as the “Senior Secured Notes”). We recognized $167 million of the $170 million cash make-whole payment on the Private Senior Notes as a loss on debt extinguishment, with the $3 million remainder being a debt modification cost that is being amortized over the term of the Senior Secured Notes.

In connection with the completion of the offering of the Senior Secured Notes and the prepayment of the Private Senior Notes in November 2016, certain amendments to the Revolving Credit Agreement became effective. The amendments included, among other things, changes in and additions to the financial and other covenants and a reduction in the size of the facility from $1.5 billion to $750 million.

In conjunction with our debt restructuring, including amendments to the Revolving Credit Agreement, we recognized $18 million of debt issuance and amendment fees in 2016. See further discussion under "Liquidity and Capital Resources" below and Note 11—Financing Agreements for additional information.

Our capacity expansion projects were completed in the fourth quarter of 2016. Capacity expansion project expenses in 2016 and 2015 of $73 million and $51 million, respectively, are included in other operating—net in our consolidated statements of operations and generally consisted of administrative costs and other project costs that did not qualify for capitalization.

Start-up costs of $52 million, which primarily relate to the cost of commencing production at the ammonia plants, were incurred in 2016 and are included in cost of sales in our consolidated statements of operations. Losses on foreign currency derivatives of $22 million in 2015 are included in other operating—net in our consolidated statements of operations and relate to hedges of European euro denominated equipment purchased as part of the capacity expansion projects.

On August 6, 2015, we entered into a definitive agreement (as amended, the Combination Agreement) to combine with the European, North American and global distribution businesses of OCI N.V. (OCI). On May 22, 2016, CF Holdings, OCI and the other parties to the Combination Agreement entered into a termination agreement (the Termination Agreement) under which the parties agreed to terminate the Combination Agreement by mutual written consent. Pursuant to the Termination Agreement, CF Holdings paid OCI a termination fee of $150 million. Under the Termination Agreement, the parties to the Combination Agreement also agreed to release each other from any and all claims, actions, obligations, liabilities, expenses and fees in connection with, arising out of or related to the Combination Agreement and all ancillary agreements contemplated thereby (other than the confidentiality agreement between CF Holdings and OCI) or the transactions contemplated therein or thereby.

In 2016, we incurred $179 million of transaction costs associated with the proposed combination with certain businesses of OCI and our strategic venture with CHS. This includes the $150 million termination fee paid to OCI in the second quarter of 2016, which is described above, and costs for various consulting and legal services. In 2015, we incurred $57 million of transaction costs associated with the proposed combination with certain businesses of OCI, our strategic venture with CHS, and the acquisition of the remaining 50% equity interest in CF Fertilisers UK not previously owned by us.

On September 18, 2015, in connection with our proposed combination with OCI, we entered into a senior unsecured 364-day Bridge Credit Agreement (as amended, the Bridge Credit Agreement). Upon the termination of the Combination Agreement on May 22, 2016, the lenders' commitment under the Bridge Credit Agreement terminated automatically and we recognized $28 million in bridge loan commitment fees. In 2015, we recognized $6 million of fees related to the initiation of the bridge loan.

On July 31, 2015, we acquired the remaining 50% equity interest in CF Fertilisers UK Group Limited (formerly known as GrowHow UK Group Limited) (CF Fertilisers UK) not previously owned by us for total consideration of $570 million, and CF Fertilisers UK became a wholly owned subsidiary. Upon the acquisition, we recognized a $94 million gain on the remeasurement to fair value of our initial 50% equity investment in CF Fertilisers UK. CF Fertilisers UK Limited (formerly known as GrowHow UK Limited), a wholly owned subsidiary of CF Fertilisers UK, operates two nitrogen manufacturing complexes in the United Kingdom, in the cities of Ince and Billingham. This transaction increased our manufacturing capacity with the acquisition of CF Fertilisers UK’s nitrogen manufacturing complexes. The Ince complex is located in northwestern England and consists of an ammonia plant, three nitric acid plants, an AN plant and three NPK plants. The Billingham complex is located in the Teesside chemical area in northeastern England, and consists of an ammonia plant, three nitric acid plants, a carbon dioxide plant and an AN fertilizer plant.

In the fourth quarter of 2017, we recognized a gain of $14 million related to the sale of our interest in a joint venture that owns a carbon dioxide liquefaction and purification facility. During 2015, we recognized a loss of $43 million related to the sale of our 50% investment in Keytrade AG and the sale of our 50% investment in an ammonia storage joint venture in Houston, Texas.

Our equity in earnings (losses) of operating affiliates for the years ended December 31, 2016 and 2015, includes an impairment charge of our equity method investment in PLNL of $134 million and $62 million, respectively. PLNL is our joint venture investment in the Republic of Trinidad and Tobago and operates an ammonia plant that relies on natural gas supplied by the National Gas Company of Trinidad and Tobago Limited (NGC) pursuant to a gas sales contract (the NGC Contract). PLNL had experienced curtailments in the supply of natural gas from NGC, which reduced the ammonia production at PLNL. See "Critical Accounting Policies and Estimates" below, for additional information.

See Note 7—Equity Method Investments for additional information regarding our equity method investments.

We reported net earnings attributable to common stockholders of $358 million in 2017 compared to a net loss of $277 million in 2016, or an increase in net earnings between the periods of $635 million. Tax Reform had a significant impact on our reported results in 2017 as we recognized $491 million of income in our tax provision related to the enactment of Tax Reform in the United States. Further information regarding the impact of Tax Reform can be found above under "Items Affecting Comparability of Results—Tax Cuts and Jobs Act." Diluted net earnings per share attributable to common stockholders was $1.53 in 2017 compared to diluted net loss per share attributable to common stockholders of $1.19 in 2016, or an increase of $2.72 per share. The impact of Tax Reform added $2.10 to diluted earnings per share in 2017.

Earnings before income taxes increased by $101 million to a loss of $125 million in 2017 from a loss of $226 million in 2016. The increase in earnings before income taxes is due to a combination of the following three categories of items which are described below:

In 2016, we recognized $617 million of certain significant charges from the following items:

As discussed earlier in "Overview of CF Holdings—Industry Factors and Items Affecting Comparability of Results," our operating results continue to be impacted by a surplus of capacity in the nitrogen industry, which has impacted product selling prices. Industry pricing conditions in 2017 declined early in the year to multi-year lows as oversupply conditions persisted, but selling prices rose as the year ended when supply and demand conditions were more in balance due to delays in the start-up of certain new industry capacity and stronger demand in certain regions. Our results in 2017 also included the full impact of all of our new capacity expansion plants. As a result, we set both production and sales volume records in 2017.

Our net sales are derived primarily from the sale of nitrogen fertilizers and are determined by the quantities of fertilizers we sell and the selling prices we realize. The volumes, mix and selling prices we realize are determined to a great extent by a combination of global and regional supply and demand factors. Net sales also include shipping and handling costs that are billed to our customers. Sales incentives are reported as a reduction in net sales.

Our total net sales ~~decreased $623~~increased $445 million, or ~~14%~~12%, to $4.13 billion in 2017 compared to $3.69 billion in 2016 ~~compared~~due to ~~$4.31 billion~~an 18% increase in ~~2015. The impact of the CF Fertilisers UK acquisition~~sales volume, which increased ~~our~~ net sales by ~~$269~~$738 million, ~~or 6%. The remaining decline in our net sales of $892 million, or 21%, was due to~~partially offset by a ~~31% decline~~5% decrease in average selling prices, ~~partially offset~~which reduced net sales by ~~a 14% increase in sales volume.~~

The increase in ~~the second half of the year.~~

Our cost of sales includes manufacturing costs, purchased product costs, and distribution costs. Manufacturing costs, the most significant element of cost of sales, consist primarily of raw materials, realized and unrealized gains and losses on natural gas derivative instruments, maintenance, direct labor, depreciation and other plant overhead expenses. Purchased product costs primarily include the cost to purchase nitrogen fertilizers to augment or replace production at our facilities. Distribution costs include the cost of freight required to transport finished products from our plants to our distribution facilities and storage costs incurred prior to final shipment to customers.

Our cost of sales increased ~~$84~~$855 million, or 3%30%, from ~~2015~~2016 to ~~2016.~~2017. The ~~overall~~ increase in cost of sales iswas primarily due ~~primarily~~ to the impact of ~~the CF Fertilisers UK acquisition, which increased cost of~~higher sales by $251 million, or 9%, as 2016 includes a full year of CF Fertilisers UK results and 2015 includes five months of CF Fertilisers UK results. The remaining decrease in our cost of sales of $167 million, or 6%, was due primarily to the combination ofvolume, higher unrealized net mark-to-market ~~gains~~losses on natural gas derivatives and ~~lower~~higher realized natural gas costs, ~~partly~~including the impact of realized derivatives, in addition to higher depreciation expense related to the completion of our capacity expansion projects and placing those assets into service. These increases to cost of sales were partially offset by ~~higher capacity expansion project related costs.~~targeted cost reduction initiatives, production efficiencies due to increased volume in 2017 and the absence of start-up costs of the new ammonia plant at our Donaldsonville facility and the new ammonia and urea plants at our Port Neal facility that occurred in 2016. The cost of sales per ton averaged $185 in 2017, a 10% increase from $168 per ton in 2016. Cost of sales includes a $61 million unrealized net mark-to-market loss in 2017 compared to a $260 million unrealized net mark-to-market gain in ~~2016 as compared to a $176 million unrealized net mark-to-market loss in 2015. Realized~~2016. Additionally, realized natural gas costs, including the impact of ~~lower purchased natural gas costs and~~ realized derivatives, ~~declined 6%~~increased 11% from ~~$3.28 per MMBtu in 2015 to~~ $3.07 per MMBtu in 2016 ~~as natural gas prices were lower~~to $3.40 in ~~2016, particularly in the first half of the year with high storage levels and strong production in North America, although natural gas prices increased towards the end of 2016.~~

Our selling, general and administrative expenses consist primarily of corporate office expenses such as salaries and other payroll-related costs for our executive, administrative, legal, financial and marketing functions, as well as certain taxes and insurance and other professional service fees, including those for corporate initiatives.

Selling, general and administrative expenses increased $4$18 million to $192 million in 2017 from $174 million in ~~2016 from $170 million in 2015.~~2016. The increase was due primarily to the ~~impact~~combination of ~~the CF Fertilisers UK acquisition, partly offset by lower costs for~~certain corporate office initiatives and ~~lower intangible asset amortization expense.~~higher incentive compensation due to improvements in operating performance.

Transaction costs consist of various consulting and legal services associated with the proposed combination with certain businesses of OCI that was terminated on May 22, ~~2016,~~2016; our strategic venture with CHS, which began on February 1, ~~2016,~~2016; and our July 31, 2015 acquisition of the remaining 50% equity interest in CF Fertilisers UK not previously owned by us.

In 2016, we incurred $179 million of transaction costs, including the $150 million termination fee paid ~~by CF Holdings~~ to OCI in the second quarter of 2016 as a result of the termination of the Combination Agreement and costs for various consulting and legal services. ~~In 2015, we incurred $57 million of transaction costs associated with the agreements pertaining to the proposed combination with certain businesses of OCI and our strategic venture with CHS.~~

Other operating—net includes administrative costs ~~associated with our capacity expansion projects and other costs~~ that do not relate directly to our central ~~operations.~~operations and costs associated with our capacity expansion projects. Costs included in "other costs" can include foreign exchange gains and losses, unrealized gains and losses on foreign currency derivatives, costs associated with our closed facilities, amounts recorded for environmental remediation for other areas of our business, litigation expenses and gains and losses on the disposal of fixed assets.

Other operating—net was $18 million of expense in 2017 compared to $208 million of expense in ~~2016 compared to $92 million in 2015.~~2016. The ~~increased~~decreased expense was due primarily to a $93 million loss in 2016 from the impact of ~~realized and unrealized losses on~~changes in foreign currency ~~transactions~~exchange rates on primarily ~~related to~~ British pound ~~sterling~~and Canadian dollar denominated intercompany ~~debt~~loans that ~~has~~were not ~~been~~ permanently invested. ~~In addition,~~Due to a restructuring of certain intercompany loans, we did not incur the ~~increased~~same level of foreign exchange rate impacts in 2017. The decreased expense is also ~~reflects higher~~due to expansion project ~~costs pertaining to our Donaldsonville, Louisiana~~expenses in 2016 of $73 million, generally consisting of administrative and ~~Port Neal, Iowa capacity expansion projects~~other project costs that did not qualify for capitalization, and ~~the loss of~~a $23 million charge representing the net fair value adjustments to an embedded derivative related to our strategic venture with CHS. See Note 9—8—Fair Value Measurements ~~to our consolidated financial statements included in Item 8 of this report~~ for additional information. ~~These increases were partly offset by a decrease in realized and unrealized losses on foreign currency derivatives of $22 million.~~

Equity in earnings (losses) ~~earnings~~ of operating affiliates primarily consists of our 50% ownership interest in PLNL. We include our share of the net earnings from our equity method investment in PLNL as an element of earnings from operations because this investment provides additional production and is integrated with our other supply chain and sales activities. Our share of the net earnings includes the amortization of certain tangible and intangible assets identified as part of the application of purchase accounting at acquisition. In 2016, ~~and 2015,~~ equity in earnings (losses) ~~earnings~~ of operating affiliates also includes ~~impairments~~impairment of our equity method investment in PLNL.

Equity in earnings (losses) ~~earnings~~ of operating affiliates ~~decreased by $110~~was $9 million of earnings in ~~2016 as~~2017 compared to ~~2015 due primarily~~$145 million of losses in 2016. Earnings in 2017 includes a gain of $14 million related to the sale of our interest in a joint venture that owns a carbon dioxide liquefaction and purification facility. In the fourth quarter of 2016, we recognized a $134 million impairment of our equity method investment in ~~PLNL that was recognized in the fourth quarter of 2016. In the fourth quarter of 2015, we recognized a $62 million impairment of our equity method investment in~~ PLNL. The remaining decrease was due primarily to lower operating results from PLNL, which included costs of $21 million that were incurred during 2016 related to a planned maintenance activity at the PLNL ammonia plant that resulted in the shutdown of the plant for approximately 45 days and the impact of lower ammonia selling prices in 2016 compared to 2015. For additional information regarding the impairment of our equity method investment in PLNL, see ~~Note 8—Equity Method Investments to our consolidated financial statements included in Item 8 of this report and~~ "Critical Accounting Policies and Estimates," ~~below.~~below, and Note 7—Equity Method Investments.

Our interest expense—net includes the interest expense on our long-term debt, amortization of the related fees required to execute financing agreements and annual fees pursuant to our Revolving Credit Agreement. Capitalized interest relating to the construction of major capital projects reduces interest expense as the interest is capitalized and amortized over the estimated useful lives of the facility along with all other construction costs. Our interest expense—net also includes interest income, which represents amounts earned on our cash, cash equivalents ~~investments~~ and ~~advances to unconsolidated affiliates.~~investments.

Net interest expense increased by ~~$64~~$108 million to ~~$195~~$303 million in ~~2016~~2017 from ~~$131~~$195 million in 2015. The ~~$64~~$108 million increase ~~in net interest expense~~ was due primarily to a decrease in the ~~combination~~amount of ~~higher debt levels~~interest capitalized due to the ~~issuance~~completion of ~~$1.0 billion of Private Senior Notes~~our capacity expansion projects. In 2016, capitalized interest was $166 million compared to $2 million in ~~September 2015 and debt amendment fees and accelerated~~2017. Net interest expense in 2016 also includes the amortization of ~~debt issuance costs due~~capitalized bridge credit agreement fees of $28 million pertaining to the ~~restructuring~~bridge loan for our proposed combination with certain businesses of ~~our debt and~~OCI. Upon the ~~Revolving Credit Agreement in 2016. Due~~termination of the proposed combination with OCI, the unamortized portion of these fees was expensed.

During 2016, due to the uncertain duration of the prevailing low nitrogen fertilizer selling price environment and in order to provide liquidity and covenant flexibility for the future, we modified the Revolving Credit Agreement ~~in 2016~~ by reducing its size from $2.0 billion to $750 million and modifying certain covenants and other terms. As a result of these changes, we recognized $16 million of debt amendment fees and accelerated amortization of loan fees in interest ~~expense. The increase~~expense in interest expense—net in 2016 also includes the amortization of capitalized Bridge Credit Agreement fees of $28 million pertaining to the bridge loan for our proposed combination with certain of the OCI businesses. We also recorded capitalized interest of $166 million in 2016 related primarily to our capacity expansion projects compared to $154 million in 2015.

Our income tax benefit for ~~2016~~2017 was $575 million on a pre-tax loss of $125 million, compared to an income tax benefit of $68 million on a pre-tax loss of $226 million ~~resulting~~in the prior year. The higher income tax benefit in 2017 is due primarily to the impact of the Tax Act, which resulted in an income tax benefit of $491 million recorded in the fourth quarter of 2017, reflecting our best estimate of the impact of the Tax Act.

The primary impact of the Tax Act is the revaluation of all of our U.S. deferred tax balances, as result of the reduction of the U.S. statutory corporate tax rate from 35% to 21%, which resulted in an income tax benefit of $552 million that was recorded in 2017. This income tax benefit was partially offset by a tax charge and liability of $57 million, which represents our best estimate of the transition tax, or repatriation tax, on foreign earnings and profits, as described above under "Items Affecting Comparability—Tax Cuts and Jobs Act."

In addition, in both years, our effective tax rate is impacted by earnings attributable to noncontrolling interests in CFN and TNCLP, as our consolidated income tax (benefit) provision does not include a tax provision on the earnings attributable to the noncontrolling interests. As a result, earnings attributable to the noncontrolling interests of $92 million and $119 million in 2017 and 2016, respectively, which are included in our pre-tax loss, impact the effective tax rate in both years. See Note 16—Noncontrolling Interests for additional information.

Due primarily to the $491 million income tax benefit from the Tax Act, we recognized a $575 million income tax benefit in 2017 on a pre-tax loss of $125 million. Our effective tax rate in 2017, exclusive of the tax benefit from the Tax Act and exclusive of the earnings attributable to the noncontrolling interests of $92 million from our pre-tax loss, results in an effective tax rate of ~~30.0%, compared~~38.8%. Our effective tax rate in 2016, exclusive of the earnings attributable to ~~an income tax provision~~the noncontrolling interests of ~~$396~~$119 million onfrom our pre-tax income, ~~of $1.06 billion, or~~resulted in an effective tax rate of ~~37.4%, in the prior year.~~

In the fourth ~~quarters~~quarter of 2016, ~~and 2015,~~ we determined the carrying value of our equity method investment in PLNL exceeded fair value and recognized an impairment of our equity method investment in PLNL of $134 million, ~~and $62 million, respectively,~~ which is included in the equity in earnings of operating affiliates. Our ~~respective~~2016 income tax ~~provisions do~~provision does not include a tax benefit for the impairment of our equity method investment as it will not give rise to a tax ~~deduction.~~

Both 2017 and 2016 were impacted by ~~earnings attributable to noncontrolling interests in CFN and TNCLP, as our consolidated income~~additional discrete tax provision does not include a tax provision on the earnings attributable to the noncontrolling interests. Earnings attributable to noncontrolling interests increased in 2016 due to our strategic venture with CHS that commenced on February 1, 2016, at which time CHS purchased a minority equity interest in CFN.items. See Note ~~17—Noncontrolling Interests to our consolidated financial statements included in Item 8 of this report~~9—Income Taxes for additional information.

Net earnings attributable to noncontrolling interests includes the net earnings attributable to the 24.7% interest of the publicly-held common units of TNCLP. We own approximately 75.3% of TNCLP and outside investors own the remaining 24.7%. Net earnings attributable to noncontrolling interests also includes the net earnings attributable to the approximately 11% CHS minority equity interest in CFN, a subsidiary of CF Holdings, purchased for $2.8 billion on February 1, 2016.

Net earnings attributable to noncontrolling interests ~~increased $85~~decreased $27 million in ~~2016~~2017 compared to ~~2015~~2016 due primarily to ~~the~~lower earnings ~~attributable to the noncontrolling interest in CFN. This increase is partly offset~~from both CFN and TNCLP as both were impacted by lower ~~net~~average selling prices due to greater global nitrogen supply availability due to global capacity additions. The earnings ~~attributable to~~of CFN were also impacted by higher natural gas prices and the ~~approximately 24.7% interest~~impact of higher depreciation as a result of the ~~publicly held common units~~completion of ~~TNCLP.~~our capacity expansion projects and placing those assets into service.

Diluted net earnings (loss) ~~earnings~~ per share attributable to common stockholders, ~~decreased $4.15~~including the impact of Tax Reform, increased $2.72 to earnings of $1.53 per share in 2017 from a loss of $1.19 per share in ~~2016 from diluted net earnings per share attributable to common stockholders of $2.96 per share in 2015.~~2016. This ~~decrease~~increase is ~~due to lower net earnings.~~

Our total net sales decreased ~~$435~~$623 million, or 9%14%, to $3.69 billion in 2016 compared to $4.31 billion in ~~2015 compared to $4.74 billion in 2014.~~2015. The impact of the CF Fertilisers UK acquisition increased our net sales by ~~$208 million.~~$269 million, or 6%. The remaining decline in our net sales of ~~$643~~$892 million, or ~~14%~~21%, ~~included a $475 million decrease attributable to the Nitrogen Product Segments and a $168 million decrease~~was due to ~~the sale of the phosphate business in March 2014. The remaining Nitrogen Product Segments net sales decreased due to an 8%~~a 31% decline in average selling prices ~~and~~partially offset by a ~~3% decline~~14% increase in sales volume.

Our total ~~Nitrogen Product Segments~~ sales volume increased by ~~3%.~~24% from 2015 to 2016. The impact of the CF Fertilisers UK acquisition increased our sales volume by 6%10%. The remaining ~~decline~~increase in our ~~Nitrogen Product Segments~~ sales volume of 3%14% was due primarily to ~~lower ammonia~~greater granular urea and UAN ~~sales volume. Our~~volume available for sale due to our completed capacity expansion projects, partly offset by lower ammonia sales volume ~~was~~due to lower demand in North America during the fall application season. In addition, our ammonia sales volumes were lower in ~~2015 partly due to a poor fall application season in North America~~2016 as we upgraded existing ammonia production as a result of ~~poor weather conditions in the Midwest. The season started late and ended early in November due to snow in the Midwest. In addition,~~ our ~~ammonia~~granular urea and UAN ~~sales volume were lower as customers were hesitant to buy in a declining pricing environment.~~capacity expansion projects coming on line at our Donaldsonville, Louisiana complex.

Our ~~total~~ cost of sales ~~decreased $204~~increased $84 million, or 7%3%, from ~~2014~~2015 to ~~2015 including~~2016. The overall increase in cost of sales is due primarily to the impact of the CF Fertilisers UK acquisition, which increased cost of sales by ~~$185~~$251 million, or ~~6%.~~9%, as 2016 includes a full year of CF Fertilisers UK results and 2015 includes five months of CF Fertilisers UK results. The remaining decrease in our cost of sales of ~~$389~~$167 million, or ~~13%~~6%, was due primarily to ~~lower~~the combination of unrealized net mark-to-market gains on natural gas derivatives and lower realized natural gas costs, partly offset by higher capacity expansion project related costs. ~~The realized~~Cost of sales includes a $260 million unrealized net mark-to-market gain in 2016 as compared to a $176 million unrealized net mark-to-market loss in 2015. Realized natural gas costs, including the impact of lower purchased natural gas costs and realized ~~derivative losses during 2015, decreased 28% compared to 2014. Cost of sales~~derivatives, declined 6% from $3.28 per MMBtu in 2015 ~~also included $176 million of unrealized net mark-to-market losses on~~to $3.07 per MMBtu in 2016 as natural gas ~~derivatives compared to losses of $79 million~~prices were lower in ~~2014. Lower gas costs were primarily driven by increasing North American natural gas production, as increased well efficiencies increased supply. Warm weather conditions, especially~~2016, particularly in the ~~fourth quarter, also contributed to~~first half of the year with high storage levels and strong production in North America, although natural gas prices increased towards the ~~resulting decline~~end of 2016.

Capacity expansion project costs, including depreciation expense, which commenced once the respective expansion plant was placed in ~~gas prices. The~~service, totaled $116 million in 2016. Start-up costs, which primarily relate to the cost of ~~sales~~commencing production at the new ammonia plants for our Donaldsonville, Louisiana and Port Neal, Iowa plants, totaled $52 million in 2016.

Cost of goods sold per ton ~~in our Nitrogen Product Segments averaged $200~~declined $33 per ton, or 16%, from $201 in 2015 to $168 in 2016, as a ~~5% decrease from~~result of the ~~$211 per ton in 2014.~~factors noted above.

Selling, general and administrative expenses increased ~~$18~~$4 million to $174 million in 2016 from $170 million in ~~2015 from $152 million in 2014.~~2015. The increase was due primarily to the impact of the CF Fertilisers UK acquisition, ~~an increase in~~partly offset by lower costs for corporate ~~project activities,~~office initiatives and ~~higher~~lower intangible asset amortization expense.

In 2016, we incurred $179 million of transaction costs associated with the proposed combination with certain businesses of OCI and our strategic venture with CHS. This includes the $150 million termination fee paid by CF Holdings to OCI in the second quarter of 2016 as a result of the termination of the Combination Agreement and costs for various consulting and legal services. In 2015, we incurred $57 million of transaction costs ~~for various consulting and legal services~~ associated ~~primarily~~ with ~~executing the strategic agreements in connection with, and preparing for~~ the proposed combination with certain businesses of OCI, our strategic venture with CHS and ~~our~~the acquisition of the remaining 50% equity interest in CF Fertilisers UK not previously owned by us.

Other operating—net ~~changed by $39~~was $208 million ~~from $53 million of expense~~ in ~~2014~~2016 compared to ~~expense of~~ $92 million in 2015. The increased expense was due primarily to $93 million of realized and unrealized losses on foreign currency transactions primarily related to British pound denominated intercompany debt that has not been permanently invested. In addition, the increased expense also reflects higher expansion project costs pertaining to our Donaldsonville, Louisiana and Port Neal, Iowa capacity expansion projects that did not qualify for ~~capitalization. This was partially~~capitalization and the loss of $23 million representing the net fair value adjustments to an embedded derivative related to our strategic venture with CHS. See Note 8—Fair Value Measurements for additional information. These increases were partly offset by ~~the~~a decrease in realized and unrealized losses on foreign currency derivatives ~~from $38 million~~ of ~~losses in 2014 to~~ $22 ~~million of losses in 2015.~~million.

Equity in (losses) earnings of operating affiliates ~~consists of our 50% share of the operating results of PLNL. Equity in (losses) earnings of operating affiliates~~ decreased by ~~$78~~$110 million in ~~2015~~2016 as compared to ~~2014~~2015 due primarily to a ~~$62~~$134 million impairment of our equity method investment in PLNL that was recognized in the fourth quarter of ~~2015.~~2016. In the fourth quarter of 2015, we recognized a $62 million impairment of our equity method investment in PLNL. The remaining decrease was due primarily to lower operating results from PLNL, ~~due~~which included costs of $21 million that were incurred during 2016 related to a planned maintenance activity at the PLNL ammonia plant that resulted in the shutdown of the plant for approximately 45 days and the impact of lower ~~average~~ammonia selling ~~prices.~~prices in 2016 compared to 2015. For additional information regarding the impairment of our equity method investment in PLNL, see "Critical Accounting Policies and Estimates," below, and Note 7—Equity Method Investments.

~~Interest expense—net was~~Net interest expense increased by $64 million to $195 million in 2016 from $131 million in ~~2015 compared to $177~~2015. The $64 million ~~in 2014. The $46 million decrease~~increase in net interest expense was due primarily to the combination of higher ~~amounts of capitalized interest related to our capacity expansion projects, partially offset by higher interest expense pertaining~~debt levels due to the issuance of $1.0 billion ~~and $1.5 billion~~ of ~~senior notes issued~~Private Senior Notes in September 2015 and debt amendment fees and accelerated amortization of debt issuance costs due to the restructuring of our debt and the Revolving Credit Agreement in ~~March 2014, respectively.~~2016. Due to the uncertain duration of the prevailing low nitrogen fertilizer selling price environment and in order to provide liquidity and covenant flexibility for the future, we modified the Revolving Credit Agreement in 2016 by reducing its size from $2.0 billion to $750 million and modifying certain covenants and other terms. As a result of these changes, we recognized $16 million of debt amendment fees and accelerated amortization of loan fees in interest expense. The increase in interest expense—net in 2016 also includes the amortization of capitalized Bridge Credit Agreement fees of $28 million pertaining to the bridge loan for our proposed combination with certain of the OCI businesses. We also recorded capitalized interest of ~~$154~~$166 million in ~~2015~~2016 related primarily ~~related~~ to our capacity expansion projects compared to ~~$74~~$154 million in ~~2014.~~2015.

Our income tax benefit for 2016 was $68 million on a pre-tax loss of $226 million, resulting in an effective tax rate of 30.0%, compared to an income tax provision ~~for 2015 was~~of $396 million on pre-tax income of $1.06 billion, or an effective tax rate of 37.4%, ~~compared to an income tax provision of $773 million on pre-tax income of $2.19 billion, or an effective tax rate of 35.3%~~ in the prior year. ~~The increase~~

State income taxes for 2016 were favorably impacted by investment tax credits of $13 million related to capital assets placed in service at our production facilities in Oklahoma that are indefinitely available to offset income taxes in that jurisdiction in future years. Our effective state income tax rate was also reduced as a result of the changes to our legal entity structure effected in the ~~effective~~first quarter of 2016 as part of our strategic venture with CHS. See Note 16—Noncontrolling Interests for additional information.

State income taxes for 2016 includes a tax ~~rate in 2015 was due primarily to the impact~~benefit of ~~certain transactional expenses that are not deductible~~$46 million, net of federal tax effect, for ~~tax purposes.~~ state net operating loss carryforwards.

The income tax provision for 2016 includes the tax impact of the recaptured U.S. manufacturing profits deductions claimed in ~~2014~~prior years that will not be deductible as a result of our intention to carryback the tax net operating loss for the year ended December 31, 2016 to those prior tax years.

Non-deductible capital costs for the tax year ended December 31, 2016 include certain transaction costs capitalized in the prior year that are now deductible as a result of the termination of the proposed combination with certain businesses of OCI.

Foreign subsidiaries of the Company have incurred capital losses of $109 million that are indefinitely available to offset capital gains in those foreign jurisdictions. As the future realization of these carryforwards is not anticipated, a valuation allowance of $28 million was recorded in 2016.

In the fourth quarters of 2016 and 2015, we determined the carrying value of our equity method investment in PLNL exceeded fair value and recognized an impairment of our equity method investment in PLNL of $134 million and $62 million,

During the third quarter of 2015, we acquired the remaining 50% equity interest in CF Fertilisers UK not previously owned by us and recognized a $94 million gain on the remeasurement to fair value of our initial 50% equity interest in CF Fertilisers UK. The earnings in CF Fertilisers UK have been permanently reinvested. Therefore, the recognition of the $94 million million gain on the remeasurement of the historical equity investment does not include the recognition of tax expense on the gain.

In ~~the fourth quarter of 2015, we determined the carrying value of~~addition, our ~~equity method investment~~effective tax rate is impacted by earnings attributable to noncontrolling interests in ~~PLNL exceeded fair value~~CFN and ~~recognized an impairment of~~TNCLP, as our ~~equity method investment in PLNL of $62 million, which is included in the equity in earnings of operating affiliates in 2015. Our~~consolidated income tax provision does not include a tax ~~benefit for the impairment of our equity method investment as it does not give rise to a tax deduction.~~

See Note 9—Income Taxes ~~to our consolidated financial statements included in Item 8 of this report~~ for additional ~~information on income taxes.~~information.

Equity in earnings of non-operating affiliates—net of taxes ~~consists of~~represents our share of the ~~financial results~~net earnings of ~~unconsolidated joint venture interests~~the entities that we account for using the equity method and exclude from operating earnings. Equity in earnings of non-operating affiliates—net of taxes in 2015 included the previously owned 50% equity method earnings of CF Fertilisers UK and ~~Keytrade. During the second quarter~~also included our share of ~~2015, we sold our interests in~~operating losses experienced at Keytrade. On July 31, 2015, we ~~completed~~acquired the remaining 50% equity interest in CF Fertilisers UK ~~acquisition~~not previously owned by us for total consideration of $570 million, and CF Fertilisers UK became wholly owned by us and ~~became~~ part of our consolidated financial results.

Net earnings attributable to noncontrolling ~~interest decreased $13~~interests increased $85 million in ~~2015~~2016 compared to ~~2014~~2015 due primarily to the earnings attributable to the noncontrolling interest in CFN. This increase is partly offset by lower net earnings attributable to the approximately 24.7% interest of the ~~publicly-held~~publicly held common units of TNCLP.

Diluted net (loss) earnings per share attributable to common stockholders decreased ~~$2.46, or 45%,~~$4.15 to a loss of $1.19 per share in 2016 from diluted net earnings per share attributable to common stockholders of $2.96 per share in ~~2015 from $5.42 per share in 2014.~~2015. This decrease is due ~~primarily~~ to ~~the $1.80 per share gain from the sale of the phosphate business in 2014, partially offset by the impact of~~ lower diluted weighted-average shares outstanding in 2015 as compared to 2014 due to the impact of our share repurchase programs. We repurchased 8.9 million shares in 2015 for $527 million, or an average cost of $59 per share. The total shares repurchased during 2015 represented 4% of the shares outstanding as of December 31, 2014.

Our ammonia segment produces anhydrous ammonia (ammonia), which is our most concentrated nitrogen fertilizer as it contains 82% nitrogen. The results of our ammonia segment consist of sales of ammonia to external customers. In addition, ammonia is the "basic" nitrogen product that we upgrade into other nitrogen products such as granular urea, UAN and AN. We produce ammonia at all of our nitrogen manufacturing complexes.

Our granular urea segment produces granular urea, which contains 46% nitrogen. Produced from ammonia and carbon dioxide, it has the highest nitrogen content of any of our solid nitrogen fertilizers. Granular urea is produced at our Courtright, Ontario; Donaldsonville, Louisiana; Medicine Hat, Alberta; and Port Neal, Iowa nitrogen complexes.

The following table presents summary operating data for our UAN segment:

Our AN segment produces ammonium nitrate (AN). AN is a nitrogen-based product with a nitrogen content between 29% and 35%. AN is used as nitrogen fertilizer and is also used by industrial customers for commercial explosives and blasting systems. AN is produced at our nitrogen complexes in Yazoo City, Mississippi and Ince and Billingham, United Kingdom.

We are one of the ~~following products:~~