The $2 trillion mining value chain at a glance

Reuters reports: Shares of Potash Corp and other fertilizer producers ebbed on Monday despite bullish industry data as a decline in U.S. corn and wheat prices signaled weaker demand for crop nutrients. PotashCorp said on its website that potash inventories at the end of June fell more than 270,000 tonnes from the previous month, with North American inventories about 26% below the prior 5-year average.

India's Department of Fertilisers raised concerns with the country's Foreign Affairs minister on Thursday over 2011 prices set by Canpotex, the company that markets and distributes Saskatchewan's potash globally. India's farming co-ops have halted imports due to the impasse and while waiting for a government decision on import subsidies. At over 6 million tonnes/year India is the biggest importer but says it pays much higher prices than a country like China can negotiate.

On only the second day of trading in Western Potash Corp. common shares on the main board in Toronto, investors were already abandoning the stock in droves. The junior player in Saskatchewan’s potash industry ended Wednesday down 5.5% after an analyst downgraded the stock. Western Potash is in the pre-feasability stage of its Milestone Project in the south of the province where it hopes to mine almost a billion tonnes of potash using steam.

Globes reports Israel Chemicals, a unit, ICL Fertilizers, will sell potash to its Chinese customers at $470 a ton, $70 a ton higher than prices to China during the first half of 2011. Under the terms of the current contract, 500,000 tons will be delivered in the second half of 2011 for $235 million. ICL reported that since 2010, it has broadened its customer base in China, and sells potash directly to Chinese fertilizer producers and distributors. ICL, which is controlled by Israel Corp, is the world's sixth-largest producer of potash.

Potash will play a huge role in Saskatchewan's predicted economic growth of an average rate of 3.5% over 2011 and 2012, according to the latest economic forecast by Scotiabank. Potash production is expected to climb close to its 2007 peak of 11 million tonnes in 2011, after suffering a dramatic 60% drop during the recession of 2009.

Stocks of Allana Potash Corp was trading slightly up at midday on Thursday after the company announced it had intersected strong potash mineralization in an area not previously drilled at its 160 square km Dallol project in Ethopia. Listed on the TSX-Venture exchange Allana's East Africa project has the backing of the World Bank and most of the assets there are still being quantified. The value of the company has doubled in 2011 and investors who bought the stock in July last year would have enjoyed a four-fold return.

Dow Jones reports Argentina's Mendoza Province has lifted its suspension of the multibillion dollar Rio Colorado potash mine project being developed by Brazilian mining company Vale SA. Mendoza's Environmental Secretariat has allowed Vale to move forward with the mine after the company agreed to submit reports on its local hiring and procurement practices to the local authorities, the provincial government said in a statement.

IC Potash, which hopes to build a potash mine in New Mexico, on Tuesday said a study it paid consultants UK-based CRU Strategies to conduct on its Ochoa project found “excellent market potential” for future production of sulphate of potash (SOP).

The Yorkshire Post reports Sirius Minerals has started a concept study at its York Potash project, paving the way for mining to begin at the UK’s only seam of potash. Sirius has secured mineral rights for 631 sq km of land between Whitby and Scarborough with plans to open a new potash mine and create up to 5,000 jobs. Sirius is about to start drilling two temporary boreholes in the North York Moors National Park. Once it gets an idea of what the potash seam looks like under the ground it can plan where to site the mine.