Sinofert, while reportedly struggling in an attempt to buy North America's top potash producer, has secured supplies from the region with a deal worth up to $2.2bn.

The Chinese fertilizer giant has negotiated imports of at least 3.1m tonnes of potash from Canpotex, the North American consortium, in a three-year agreement.

The deal - which caps Sinofert spending at $600m next year, $730m in 2012 and $870m in 2103, a filing showed - follows reports that the Chinese group has failed to find a partner to launch a counterbid for PotashCorp, the world's top potash producer.

Canada-based PotashCorp, a Canpotex member, has received a hostile $39bn bid from mining giant BHP Billiton.

Currying favour?

However, Wednesday's deal was not necessarily an admission of defeat, a London fund manager told Agrimoney.com.

"It could be the Chinese just want to secure supplies, or it could be they are trying to curry favour with the Canadians," the investor said.

Separately, the government of Saskatchewan, where PotashCorp is based, said it could still see no "net benefit" from the acquisition of the company by BHP, a position which could pose a significant hurdle to the takeover receiving Canadian consent.

The province is expected to make a further announcement on Thursday.

Marked turnaround

Steven Dechka, the Canpotex chief executive, said that Thursday's agreement demonstrated the consortium's "confidence in Sinfert as our long-term business partner", and praised the Saskatchewan government for its "very supportive role".

BHP has raised questions over whether it would keep PotashCorp with Canpotex, should its bid succeed.

Canpotex's relations with Sinofert appear remarkably less strained than a year ago when the groups were at odds, for months, over agreeing a new supply deal in a tumbling fertilizer market.

The groups in February sealed a short-term, 350,000-tonne agreement, the first deal in two years.

Historically, Canpotex deals with China have lasted for one-year, rather than Thursday's three-year accord.

While shares in PotashCorp closed down 1.7% at Can$145.90 in Toronto, stock in the other two Canpotex members closed higher. Agrium shares ended 3.3% higher at Can$88.85 in Toronto, while Mosaic stock closed up 4.3% at $67.12 in New York.