PotashCorp market dominance

The shining star in the Saskatchewan economy has been potash. Potash prices have remained high even though worldwide nitrogen and phosphate prices tumbled. Most analysts attribute that difference to market concentration. While fertilizer production generally is concentrated in the hands of fewer and fewer companies, potash production is extremely concentrated and Saskatchewan is a world powerhouse. When worldwide grain prices declined last year, dropping fertilizer demand eventually caused nitrogen and phosphate prices to soften. In potash, companies cut production a bit, but refused any significant cut in prices. Most farmers here don’t need to apply a lot of potash. That isn’t the case in many other regions of the world where potash is required to grow a good crop. In this province, it’s heresy to criticize PotashCorp because they’re a Saskatchewan success story. However, it doesn’t take too much imagination to know how Potash Corp must be viewed by farmers in other parts of the world. There’s a very interesting article on this topic by a magazine called Corporate Knights. You can see the article at www.corporateknights.ca. I’m Kevin Hursh.

www.hursh.ca

Kevin Hursh, PAg, CAC