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WaveRiderX1on May 10, 2016 1:26pm
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Favorable market conditions for Potash
Favorable market conditions for Potash Peter Brieger is chairman and managing director of GlobeInvest Capital Management. His focus is North American large caps.
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Agrium (AGU.TO)
The downward pressure on fertilizers – particularly potash – continues as contract price and volume negotiations in China and India drag on. In Agrium’s case, this has been reflected in an approximately 26-per-cent share price decline from early ’15. While the world is currently awash in supplies, we think this is a short-term phenomenon. Droughts such as that in Brazil, an unexpectedly high number of acres being planted in the U.S. and long-term chronic under-application in China and India speak to a long-term favourable demand. In Agrium’s case, its retail business has been a jewel in its crown. While we may see some further short-term price weakness, we think the negatives have been discounted.