Potash Producers reach Maximum Output
Despite doubling earnings, last week’s quarterly earnings statement by
Potash Corporation of Saskatchewan (NYSE:
POT) resulted in some negative sentiment regarding the future of the fertilizer market. The Saskatchewan-based company reported gross profits of $1.2 billion, more than double the $550 million for the year-on-year period. The company’s potash gross margin rose by $700 million, the second-highest third-quarter total in the company’s history.
Higher prices of phosphate resulted in
third-quarter phosphate gross margin rising to $169 million, well above the $96 million earned in the same period last year. The company expects 2011 earnings of between $3.40 and $3.80 a share. Analysts, on average, had forecast earnings of $3.75, according to
Thomson Reuters. Despite the strong earnings report, investors were a little concerned over the company’s modest year-end projections.
Potash prices have recovered dramatically from their recession lows, with producers now settling contracts around the $490 per tonne range, however, prices are still around half of their record high. At the current price point, at least according to Potash Corp CEO Bill Doyle, new demand should be met through expansions at already operating mines. In the earnings call Doyle claimed that the current price of potash “does not justify” the construction of new mines.
EXCEPT FOR ALLANA POTASH MR BILL DOYLE AS IN THE NEAR FUTURE YOU WILL SEE
https://potashinvestingnews.com/4144-potash-producers-maximum-output-bhp-pot-uralkali.html?utm_source=Resource+Investing+News&utm_campaign=7172e20a59-RSS_EMAIL_CAMPAIGN&utm_medium=email