pot

[cottonpicken]

Is crashing
Very worriesome

[LWeber]

NEW YORK (Dow Jones)--Fertilizer stocks were back on the downside
of their recent roller-coaster ride Friday as new data from the
U.S. Department of Agriculture increased concerns that farmers are
going without fertilizer and as a report showed a sharp drop in
potash prices in India.
Shares of Potash Corp. of Saskatchewan Inc. (POT) led the fall
Friday, dropping 8% to $85.96 in recent trading. Intrepid Potash
Inc. (IPI) fell 6.8% to $23.80, while Mosaic Co. (MOS) dropped
2.7% to $41.60 and Agrium Inc. (AGU) lost 4% to $36.40.
The USDA's July estimates showed farmers across the country had
planted more acres of corn, soybeans and wheat than had been
estimated and that slightly more bushels of each would be
produced. Prices were revised down across the board.
Sterne Agee analyst Mark Connelly said in a note that the
implications of the data would be negative for fertilizer
companies in the near term.
"Higher production means fewer expected corn acres for next
season, which means less fertilizer demand," Connelly said, adding
that concerns that farmers have been able to put off buying
fertilizer are only fueled by the fact that farmers are planting
more and still not buying potash.
Connelly did note, however, that without fertilizer this year,
there will likely be a higher need for it next season as the soil
will only be depleted faster. But "since corn uses the most
fertilizer, a big crop this year is bad for potential demand next
year."
Also contributing to Friday's decline was a report from Citigroup
that said a major purchase in India came with a price that was 25%
below last year's contracts, possibly as low as $460 or $470 per
ton. Citi's PJ Juvekar said in a note that a U.K. potash marketer
confirmed the volume of the deal but not the price.
Juvekar said further that it is typical for India to discount the
market and he believed the contract confirmed Citi's estimate for
potash contracts around $500 a ton this year.
Soleil analyst Mark Gulley said the report would be weighing on
shares, though he also noted that lower prices had been expected
for some time.
Gulley said the volatile stocks have been trading with two
separate sets of pressure. On one side there are falling prices of
crops and oil and on the other side are concerns about potash
prices. Any day the movement may come from one side or the other.
"This [potash price decline] is another data point in the story,"
he said.
The stocks have been up and down now for some time. Potash Corp.
fell below $70 in early March before rocketing back up to over
$120 at the beginning of June and then receding back to hover
slightly above $90 this month. Intrepid is 73% above its March low
but 62% off its 52-week high and Mosaic in the past three months has
fallen below $40 and traded at nearly $60.
In a note published Thursday, Susquehanna analysts predicted the
volatility would continue as pricing talks in both India and China
are going to be catalysts. The analysts said some investors are
switching from trading equities to trading option calls on the
sector.

[bduke]

Apparently... at least rumored... India signed a deal
with Sivinit of Russia for 850,000 mt @ 460 $US/mt,

India normally requires about 4-5 million mt per year.

Russia is aching to become a much more dominant
International influence, and if/when oil strengthens its
voice will be louder.... Bill

[Koldkanuck]

Nothing wrong with the price of pot going down.

"Going down to Los Angeleeeees"
"Get me a couple of Keys"


LOL

[bucket]

Wasn't Bill doyle saying not to long ago that potash was essential and farmers couldn't go without it. Looks like he read that wrong in the short term.

But the bigger picture is the question - will production suffer?

I suspect it will but Doyle blinked/played his hand so prices have to come off. I don't think he will try this grandstanding again for I think his job might be on the line. If he would have just compromised on the price a bit sooner.

[ado089]

I think Doyle and Hugh Grant from Monsanto will both be comparing notes on the basics of farm economics at a retirement community in the Keys. I'm sure he'll do fine though, he must have some of that $212 million bonus left over.

[Burbert]

Reality and the market. Since when did these two, have anything in common. The market is allllllll preception. If the BS is spread far and wide, people will buy in and pay through the nose to get in on the action. The only difference between Maidoff and the pot guy, is that the pot guy is actually selling something, based on BS not simply BS, which Maidoff was pushing!!!

[Choice2U]

Obviously, the market is a perception. One where the supply "perception" changes and demand "perception" changes constantly with market reality being the place where the two lines cross at any particular time. I will take the "market is a perception" any day over the alternative where government makes the market reality until that bubble pops as illustrated by two small examples ie. the demise of the USSR and China's move to more free enterprise to avoid a similar fate.