Long-Term Potash Demand Looking Good
Source: Mineweb, Dorothy Kosich††(3/8/10)
"T.D. Newcrest forecast 'significant growth of offshore potash demand'"
In a presentation to the Prospectors and Developers Association Conference Sunday, D'Amico forecast "significant growth of offshore potash demand."
He noted potash inventories are already dramatically correcting this year and with the price hitting $500 tonne in 2011.
The long-term forecast for domestic farm returns are healthy, D'Amico advised.
China, Brazil and India comprise almost 50% of global potash demand.
Meeting potash demand involves a myriad of challenges, including an average capex of C$2.8 million of capital, and a project development timeline averaging five to seven years. D'Amico said the potash supply situation is also complicated by the fact there hasn't been a greenfield potash development in 30 years.
D'Amico estimated that global annual potash demand grows by an average of 3% annually. Top potash importers include China, the U.S., Brazil and India. Only three nationsóChina, Russia and Belarusóproduce two-thirds of global potash supply.