Prices for potash, a commodity used in fertilizers as well as cement production, are continuing to rise. “These new and higher price levels are supported by continued strong offshore potash demand and by the historically low potash working inventories that have resulted from record demand this year,” Potash Corp said on its website.
As developing countries continue to rely on potash for agricultural gains, Western exploration and mining companies will have to keep up.
In a recent Reuters report, Canadian potash miners have plans to double exports before 2020. To avoid congestion in the main Pacific Coast rail route, there are plans to start using an underused western port.
Reuters reported analyst Alexandra Melnikova as predicting a positive short-term outlook in 2009 with an average price of US$1,200. She predicts a more sour long-term outlook with that number dropping to around US$500. “In 2011-2012 supply from green fields could disrupt market fundamentals,” she said.
This kind of bullish short-term prediction for potash, which is common amongst analysts, suggests it might be a good time to consider a potash investment.
Potash Corp. of Saskatchewan Inc. (TSX: POT) is on the rise and plans to increase capacity even further. Another company to consider is Belarusian Potash Company which is now selling its product internationally at over US$1000 per tonne. This price is expected to be maintained over several years.
