What Were Potash Companies’ 3Q16 Realized Prices?

Previously, we saw how shipments for potash fertilizer rose in 3Q16. However, potash’s selling price has been on the decline for the last few quarters and is key to the performances of potash producers (NANR).

On average, potash prices for the above five producers (MOO) fell about 40% in 3Q16 compared to 3Q15. Excess supply and weak demand as customers negotiated contracts or tapped into their inventories put downward pressure on potash prices in the quarter as well.

Intrepid Potash’s (IPI) MOP (muriate of potash) prices saw a steep fall of 44% to $161 per metric ton YoY (year-over-year), which was a continuation of last quarter’s trend. This was followed by PotashCorp (POT), which saw its potash prices fall 40% to $150 per metric ton.

According to PotashCorp, prices fell due to competitive pressures and weakness in potash demand. Competitive pressures are likely hinting at overcapacity in the market, which has pressured prices over the year.

Mosaic’s (MOS) potash prices also fell 40% year-over-year to $160 per metric ton. Agrium (AGU) was next with its potash prices falling 36% to $178 per metric ton. Compared to the above four companies, Israel Chemicals’ (ICL) potash prices were impacted the least, falling by 30% to $199 per metric ton from $283 per metric ton.

Let’s continue our discussion to see how these producers performed in terms of margins in this segment.