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What PotashCorp’s Earnings Could Tell about Potash Price Expectations

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Potash prices

Previously in this series, we discussed how Potash Corporation of Saskatchewan’s (POT) overall Potash segment’s shipment volumes rose nearly 22% on a YoY (year-over-year) basis, while the segment’s sales grew only 13.4% YoY. Besides shipments, realized prices for fertilizers are key to sales growth.

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Potash prices

In 1Q17, average realized prices for potash fertilizer fell 7% YoY from $178 per ton to $166 per ton. In the North American (XLB) market, potash realized prices rose 7% YoY to $190 per ton from $178 per ton one year ago. However, in the offshore market, prices continued to remain subdued, affecting the sales performance for POT’s Potash segment.

The offshore market

In the offshore market, potash prices fell nearly 16% YoY to $150 per ton from $179 per ton. These markets include players such as Israel Chemicals (ICL), Agrium (AGU), and Mosaic (MOS). The fall in prices in the offshore market as compared to the North American market indicates possible price pressures coming from other players that serve this market.

You should note that since prices play such a critical role in the success of fertilizer companies, Market Realist publishes a weekly update to help you keep a close eye on the direction of fertilizer prices every week. You can read the latest report in the series Fertilizer Stocks and Prices for the Week Ending April 21.

Next, we’ll discuss nitrogen shipments.

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