Brixton Metals teams up with Eldorado on Atlin Goldfields project
Located 9 km east of the town of Atlin, British Columbia, the property comprises a 579-square-kilometre claim group.
Amid the carnage in the sector, London-based research house Integer gives a more sober assessment of the impact on the potash industry of Uralkali’s surprise announcement.
Oliver Hatfield, Director of Fertilizer at Integer Research, says while Uralkali’s announcement that it will stop selling potash through the Belarusian Potash Company (BPC) is “a significant development” it is not a “dramatic game changer in the business:”
“The announcements are in line with Integer Research’s long held view that a lower potash price is necessary to stimulate demand and discourage new entrants. Prices might fall in the near term, but we do not expect to see a price war.
“The breakup of BPC still leaves over 50% of global capacity in the hands of two marketing companies – Canpotex and Uralkali Trading – down from around 65% before the announcement, and it remains an oligopoly business.
“The potash industry has long avoided cost-based pricing and it remains in no producer’s financial interests. The price only needs to drop to a level which will discourage new entrants to have the desired effect.
“Uralkali has a strong interest in sending out signals that the era of $500 per tonne high potash prices is over to deter potential new entrants.
“Supply is still highly concentrated in the industry without BPC, and although prices might drop in the short term, I would expect to see a continuation of the supply discipline which has distinguished potash from other commodity industries in the medium to long term.”
SEE ALSO: Potash casualties pile up as price heads below $300
FLASHBACK: Uralkali settles US antitrust suit with pocket money, passes buck to Potash Corp et al
Comments
Ravi Sinha
The contention that Uralkali would like to send signal to the potential new entarants
that potash market is not all that lucrative and that even the member of the Cartel are forced to lower the price, sounds logical.This country thinks in long term strategy and wants to keep away the new entarant.
Potash from alternate source are in the advanced stage of development in Australia and Brazil. Once the companies with this this new innovative technology of harnessing potash from alternate sources from these two countries come in the market, the monopoly in the marketing of potash from the conventional potash minerals would become weak.
Country like India should take a leaf out of this development and break into the realm of potash production from the alternate source and use this lowered price to its advantage.
The crop land in India does need Potash, as the soil fertility w.r.t this major soil nutrient has gone down and is certainly affecting the crop yield.To make things worse the govt has decontrolled the price of potassic & phosphatic fertilizer and more & more farmers are finding the price un-affordable.
Ravi Sinha