Potash and phosphate producers have already been riding the wave of increased grain prices, and have been able to continuously boost prices charged for the crop nutrients. According to the USDA’s reports, this trend has no sign of stopping, at least in the near future.
Over the past year, potash producers have incrementally increased the price charged for potash, as top crop prices have given farmers extra incentive to boost yields.
While grain prices have been experiencing volatility in the aftermath of Japan’s earthquake; potash prices have yet to feel the effects.
Financial services firm Citigroup believes that the recent rally in stock prices of Potash Corp. of Saskatchewan and Mosaic is about to lose steam.
The merger between Russian potash miners Uralkali (LON:URKA) and Silvinit has been put on hold after an arbitration court in Russia agreed to hear minority shareholder Acron’s complaints.
Potash inventories held by North American miners have dropped below average levels, according to data released by Potash Corporation of Saskatchewan.
Majority Mosaic stakeholder Cargill has announced that it will sell its shares in the fertilizer producer, a move than many predict will result in another takeover push for Saskatchewan’s potash reserves.
The shares of potash producers rallied Wednesday, following the US Department of Agriculture’s forecast that corn stock would fall to its lowest level since 1996. The news sent grain futures higher, lifting demand for potash and other fertilizers.
Potash producer’s share prices rallied this week on the expectation that corn and soybean futures will extend their gains into the New Year.
An increased demand for potash as crop prices rise has potash poised to be a top commodity pick in 2011, according to the recent report by Scotiabank.
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