Intrepid Potash extended the round of bullish comment on fertilizer prices, flagging a strong recovery of in potash values since the summer, and seeing cause for further market “support”.
The US-based group, which was founded 21 years ago to buy a Utah potash mine from PotashCorp, said that potash prices were “currently $140 per short ton… above summer-fill price levels”, a gain equivalent to more than $150 per tonne.
Bob Jornayvaz, the Intrepid Potash chairman and chief executive, added that he expected that “under-application of potash from recent seasons, favourable weather, and very strong commodity pricing will continue to support our fertilizer markets through the spring season”.
The outlook follows upbeat comments from a range of other fertilizer groups, and indeed other agricultural suppliers such as machinery manufacturer Deere & Co, reporting boosts as elevated crop prices boost farm profitability, and producer spending.
‘Just strong demand’
Indeed, Intrepid’s report of price gains is more upbeat than that from Canada-based Nutrien, which two weeks ago reported US Midwest potash prices up $103 per tonne from a July low.
Chuck Magro, the Nutrien chief executive, said that “for potash what we’re seeing is just strong demand basically around the world”, noting that “with strong crop prices and the highest US grower margins in at least seven years, there will be strong crop input spend in 2021”.
“The US has seen the strongest price rise so far, but Brazilian prices are now transacting at $300 a tonne.”
According to Mosaic, potash prices shipped to Brazil stood at $303 per tonne on a cost and freight basis, as of Friday, the highest in 16 months, and up 38% from a low seen last April.
Nonetheless, they remain behind US values, which Mosaic reported at $322 per tonne in the port of New Orleans, up 69% from an August low, and the highest since at least 2016.
In the Corn Belt, values were pegged at $360 per tonne in the Corn Belt, up 54% from their August low, and also the highest on data going back four years.
Joc O’Rourke, the Mosaic chief executive, two weeks ago noted “soft commodity prices are at multiyear highs, and the expectation is that these strong ag economics will continue.
“So what that applies for us is continuing strong demand for fertilizers as farmers seek to maximise their production.”
He restated too that the $247 per tonne at which Belarus Potash Company last month agreed to sell potash to India “doesn’t represent the reality we’re seeing or the tightness of the market and pricing
“I can only speculate as to what motivated BPC to do that, but given the political uncertainty in Belarus over the last year, there may have been non-market drivers that played into it.”