For people in the agricultural industry, potash has been a hot topic recently. Agriculture thrives off of potash which is meant to help with its potassium. Potassium really only comes from potash when it comes to fertilizing crops. Potash is really essential to food. Without it, we would have no food supply. The potash hasn’t been doing also recently. This is because other minerals were needed over potash. There is designed to be a change with potash in the lead. An Australian minerals company has decided that is why they’ll take over, in a hostile manner, a Canadian potash company.
Shareholders more interested in Potash rather than BHP
Potash Corporation of Saskatchewan, known as Potash, has control over a big chunk of the world’s potash market. There is a big minerals extraction company in Australia called BHP Billiton that wants to be the future owners of the Canadian fertilizer company. The New York Times reports that a few days ago BHP made an offer to acquire the company for $ 130 a share. The offer was not enough, if you ask the Potash board. A tender offer is being used by BHP for a hostile takeover of Potash. This means shareholders get to see the cash directly in front of them. Potash is trying to get a better offer from another while getting shareholders to stop selling to BHP.
World would go hungry without potash
Potash is produced in 12 countries. Canada, Russia, Belarus and Germany are the countries that make over 75 percent of all the potash. Reuters reports that potash is the generic term for different compounds containing potassium, a critical ingredient in fertilizers. Crops to better with quality and quantity with potash that also makes disease less likely. It is the only existing source for potassium in fertilizer. Potash hasn’t been very stable in price. The prices are volatile for years. Less than $ 150 a ton was how much it sold for ten years ago. The price of potash skyrocketed to more than $ 1,000 a ton during the global food crisis of 2007-08. Since then, it has crashed to about $ 350-$ 375 a ton.
Wanting Saskatchewan potash
Potash has been ignored recently. It took the moves by BHP for everyone to acknowledge its existence. The growth of demand for potash within the last five years has gone up quite a bit. It that continues, by 2011 the potash supply could never be enough for the world, reports Entrepreneur. You will find numerous countries wanting more meat making it so potash is more needed. Examples of these countries are Latin America, China and India. Another factor is exploding growth in biofuels such as ethanol, which the UN said could meet 25 percent of the worlds energy needs within the next 20 years. Wheat and corn prices have gone up through this already. Now it seems that potash demand has to go up as well. It is hard to make more potash though. Right now the potash mines are mostly all old. In fact, 85 percent of the mines are 25 years old. Saskatchewan potash can’t produce much more.
New York Times
dealbook.blogs.nytimes.com/2010/08/20/bhp-begins-tender-offer-for-potash/?src=busln
Reuters
reuters.com/article/idUSTRE67J2SQ20100820
Entrepreneur
entrepreneur.com/tradejournals/article/166229304.html
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