RE: RE: Canpotex strategy? Here is my opinion on the matter when reading these paragraphs:
"By boosting sales volume, the established producers could
drive down prices to the point where opening new potash mines
might make no sense for competitors".
"But Baumgertner said he doubted that many of the proposed
mines will get built, because potash prices are too low to make
them viable".
Of course if potash prices end up selling in the mid$300 it would hurt the juniors ROI when building their new mines. However, if im a country that has to rely solely on imports to supply its agriculture industry, I would realize that these proposed potash prices are not permanent. If these state owned companies develop a long term approach and could produce their own potash at $200-300/ton by buying out junior companies (which completed all the initial steps) it doesnt matter what the Canpotex or BPC does with pricing. I would definitly want nothing to do with this monopoly and secure my own cheap potash supplies for the future!
I realize that juniors want to develop their project on their own by trying to raise $$$ but it just makes sense that a state owned companies eventually buys them out one by one for their ressources. The long term economics makes sense for them.
We will see many buyout in the future for potash juniors. IMO
Other thoughts?