Potash Exporters, India May Reach Agreement Soon
Source: MarketWatch, Ian Berry (5/18/11)
"The battle over potash shipment prices may soon come to a close."
India, which has been battling with Canadian exporters over the price of potash shipments, is "running out of time" to reach an agreement, the head of the world's largest potash exporter said Wednesday.
Other countries are quickly securing available supplies of potash, and the industry has shown it will sell out of potash even without purchases by India, which accounts for 10% of global usage, Potash Corp. of Saskatchewan Chief Executive Bill Doyle told investors at a New York conference.
An Indian fertilizer group earlier this spring talked about the prospect of taking a "potash holiday" and walking away from the market rather than signing a new import agreement at high prices. Potash exports out of Canada are handled by Canpotex, a marketing arm owned by Potash Corp., Mosaic and Agrium.
But Doyle dismissed such threats as "bluff poker." He said an agreement could be reached as soon as next week, at a fertilizer industry conference in Montreal.
Even when an agreement is reached, shipments wouldn't occur until July, he said. Meanwhile, fertilizer plants in India are on the verge of shutting down, Doyle said.
"That's not a healthy situation," he said.
Potash is considered a key nutrient to boosting crop yields, but farmers sometimes skip applications in given years.