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Potash prices are still on the low side, and some fertilizer buyers are taking advantage of the opportunity to stock up on the much-needed fertilizer.
With prices still on the low side, some fertilizer buyers are taking advantage of the opportunity to stock up on the much-needed fertilizer. China imported roughly 19 percent more potash between January and April 2013 than it did in the same period last year; 2.67 million tonnes (mt) compared to 2.25 mt during 2012. Brazil saw a 53-percent boost in imports during the first quarter of this year.
The United States also saw some activity in last month. Potash sales in North America, according to Reuters, climbed 61 percent from April to 1,062 mt; that’s compared to 59 percent for the same period last year. Longer-than-usual cold weather resulted in farmers having less time to apply the fertilizer to their crops, causing a “flurry of activity” in May, the publication said. Potash inventories declined roughly 138,000 tonnes to 2.89 mt.
Potash exports from North American, Reuters said, were down by 21 percent, to 1.066 mt.
Floods halt potash to West Coast
Flooding in Calgary, Canada is having an impact on potash shipments to Canada’s West Coast. Shipments from potash mines in Saskatchewan stopped sometime last week; however, Richard Downey, spokesperson for Agrium, expects shipments to resume within a few days. The Canadian Pacific Railway, whose main line runs through Calgary and Banff from the east, reopened the line on June 24. The Canadian West Coast is the only affected region in North America.
Company news
Passport Potash (TSXV:PPI) is continuing to work on the permits for its Holbook Basin potash project in Arizona. In an update on the permit’s status, Passport said it has completed a pre-application meeting regarding the air quality control permit for the project with the air quality division of the Arizona Department of Environmental Quality. The company is working with Trinity Consultants, which can assist the company in meeting the requirements for the permit. Passport is aiming for early 2014 approval of the permit.
Western Potash (TSX:WPX) has finalized a strategic investment with China BlueChemical and Benewood Holdings through a joint venture company, CBC Canada Holding (CBCHC). Through the transaction, CBCHC will hold a 19.9-percent interest in Western Potash, or approximately 45 million common shares at a price of $0.71.Western and CBCHC have an outstanding offtake term whereby CBCHC (or a purchaser it designates) will enter into an offtake agreement to purchase the lesser of 30 percent or 1 mt of potash per year from Western’s Milestone project f0r 20 years.
Gensource Capital (TSXV:GSP) has executed a binding term sheet with Canada Potash whereby the skills, people and assets of Canada Potash and Gensource will be combined to explore and develop potash properties in Saskatchewan. Canada Potash is a private company with a portfolio of exploration and development potash projects in Saskatchewan.
Verde Potash (TSXV:NPK) was given the final approval for its exploration reports by the National Department of Mineral Production. The company can now work towards submitting an economic development plan for the Cerrado Verde potash project in Brazil. “We are pleased that the DNPM has approved the final exploration reports for these mineral tenements. This is an important permitting milestone that advances us towards receipt of a mining concession (Portaria de Lavra) and thus further de-risks the mining side of the project,” President and CEO Cristiano Veloso said.
Securities Disclosure: I, Vivien Diniz, hold no direct investment interest in any company mentioned in this article.