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Analysts predict Recovery!

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    Analysts predict Recovery!

    Well well here we go again some genius is out with a prediction that potash will recover in 2010 in today's Leader-Post financial. Stop the presses. HA HA HA. But wait.

    China Poised To Win Cut-Price Potash Deal
    China is poised to sign the first of a series of long-awaited potash import contracts at a little over half the price of its last deals, heralding potentially a drop in potash markets worldwide, says a story from agrimoney.com.
    It says China, the world's biggest potash consumer, will during the next two days sign an import deal for 1 million tonnes of potash with Belarusian Potash Company priced at $350/t including freight, according to trade reports. In its last deal, in July 2008, China paid $575/t for potash excluding freight.
    The deal with the Uralkali-backed trading company is expected to spawn copycat contracts for about 4 million tonnes with other producers, notably in North America, at a similar price, which is considerably below potash group's hopes earlier in the year. The price in this week's deal is equivalent to about $305/t from Canada, excluding freight, the more typical pricing measure, and $290/t from Russia, analysts said.
    "These prices are at least $50/t below current market, and probably $100/t below where a deal could have been done six months ago," analysts at Sterne Agee, the US broker, said.
    Now every one knows I love MR Potash. But man haven't you learned that when Farmers your customers feel their getting screwed over on a micro Nutrient they will stop buying and guess what they did. Then throw in china with their cut throat way of doing business and bang your screwed the way we are getting on our Canola from them. Oh yea throw in Russia with a large deposit and hm they can live with oh lets say 200 plus a ton profit they sign with the largest buyer. Yea cost probably 100 mt ton to get it out and the rest is profit. Stock took a beating last week maybe the investors finally realize you can baffle them with BS for so long but sooner or later it starts to stick and then it gets messy. Merry Christmas Mr potash and all your greed.

    #2
    The whole rant with potash over the last year was for farmers. If we get fed up with the BS that companies tell us (Glypos is in short supply has to go up, shortage of tractors etc, Seed problems has to increase price, Chem price increases and fert etc etc etc)and actually stick to our guns and don't buy the product like the chinese did with potash Wham what happens the companies that sell to us need our cash and have to drop their price to get our business. Also like china if farmers ever get cash rich we control the market not the other way around like the last 10 years. So hey lets maybe watch the chinese and start dealing like they do. Its working for them. Watch in January Canola will again start to move once they squeezed us with their BS blackleg problem.

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      #3
      Also just heard from a Viterra friend who came back from Australia, Seems over their with the larger farms their is no need for Middle man, No sales reps etc etc. Viterra is not going to be able to have distribution warehouses all over the place its a new world baby. New world.

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        #4
        With the trend to larger farms, there have been some brokers trying to enter the market offering chemicals at Cost plus. Mind you they don't have warehousing, they don't handle returns, and its cash upfront.

        I read that in the next few years there won't be enought margin left in chemicals for local dealers to maintain the services that they are providing now. No more stockpiles in season, shorter hours, and tighter credit terms. Likely mean that if we decide to change chemicals in midstroke that the local dealer won't have it. Also likely to be less variety of similar formuations Its will mean that we will have to travel further distance to get our drug of choice.

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          #5
          watch this space re fertilizer sask
          you are right on the money not that im a big farmer but lots of interesting things happening with fert

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