Ontario Agriculture

The network for agriculture in Ontario, Canada

Potash: BHP or PCS - Which is the best deal for farmers? Farmers of North America Comment...What do you think?

 
Potash:  BHP or PCS - Which is the best deal for farmers.
 
Commentary from FNA-STAG
 
The coverage of the offer by BHP Billiton to buy potash mining giant Potash Corporation of Saskatchewan (PCS) has been missing one very important element - the potential impact on agricultural producers.  This important stakeholder is, after all, the end consumer of the important fertilizer product.
 
There has been full and complete analysis and speculation of the impact of the deal for shareholders, governments, and citizens of Saskatoon and Saskatchewan.  These are all important stakeholders to be sure, but the potential impact of the takeover on the farmer who uses that potash seems to have been left out of the mix. 
 
Bob Friesen, CEO of FNA-STAG, comments, "Have either of these companies talked about their farm customers yet?  What effect would this deal have on farmers?  Fertilizer costs are one of the biggest expenses for most farmers, but there hasn't been any talk about retail pricing and the impact it has on farmers' ability to grow the crops that feed the world".
 
Farmers are in a bad position compared to the fertilizer companies who set prices based on what they think they can extract from farmers for crop nutrients.  Add to that the small handful of potash companies out there, and you have a situation where the farmer has no choice but to pay the price that's given.
 
In June, 2008, according to a Bloomberg report, potash jumped to $650 a metric ton from $190 a year earlier.  This was in response to rising grain prices, including corn and soybeans, two major crops that use potash.  Friesen points out, "When a farmer finally catches a break and the price of grain goes up, the fertilizer companies go right after that margin by increasing the price of fertilizer." 
 
Friesen continues, "When the price of grain went up in 2008, there was a perceived food shortage and farmgate prices were blamed for some people having to go hungry.  Yet there were reports of some farmers around the world not producing because they could not afford to buy the requisite fertilizer".
 
FNA-STAG questions which company would be the best for farmers.  PCS's history of managing production to increase the price may be good for shareholders, but it has a negative impact on the price for farmers and the price of food.  It seems unlikely that they would change this monopolistic behavior.  As the potential new owner, would BHP continue the same price strategy that is used by PCS, or would they increase production and sell higher volumes?  This important question has so far not been addressed.
 
FNA-STAG also urges the Governments of Saskatchewan and Canada to consider their farm constituents and use whatever tools they have to ensure the interests of farmers and input costs are considered.  FNA-STAG's number one priority is farmer profitability and believes profitable farms are just as important to the economy as mining companies.
 
As the debate about the future of these two companies goes on, FNA-STAG would like to ask both PCS and BHP:  Do either PCS or BHP care about the impact that fertilizer prices have on farmers and what are you planning to do about it?
 

Views: 78

Reply to This

Replies to This Discussion

As you can see by the response no one cares. You know that the price is going to go up who ever buys it. And I bet ten to one the Saskatchewan and Canadian governments will buy shares with your tax money to get the lions share out of the higher prices you will be paying, after the deal is done.

Reply to Discussion

RSS

Agriculture Headlines from Farms.com Canada East News - click on title for full story

Which Farmer’s Almanac Is Going Out of Print?

it’s not the iconic yellow-covered Old Farmer’s Almanac that’s closing its doors. The Farmers’ Almanac, based in Lewiston, Maine, will publish its final edition in 2026, marking the end of a 208-year legacy.

USask horticulture student honours peace by growing poppies

The display is a project of the heart for University of Saskatchewan (USask) horticulture student Corporal Fikret Ükis, who has been a member of the Canadian Armed Forces since 2018. “I thought it would be meaningful to have real poppies growing here on campus. They’re such a powerful symbol; simple, but deeply emotional,” Ükis said. It has been more than 100 years since the First World War and 80 years since the Second World War, and the world continues to see terrible conflict, he noted. “People sometimes forget that the freedoms and sovereignty we enjoy today were paid for by the sacrifices of those men and women,” he said. “It’s sad to see how fragile peace can be. The Ukrainians know this better than anyone right now; their sovereignty is currently under threat. Here in Canada, we take peace for granted, and we’ve forgotten how hard people had to fight during the First and Second World Wars, and how hard we still have to fight, to protect it.” Ükis said the poppy is a delicate

USask graduate investigates gene to improve the health of barley

Feeding the world requires healthy crops that can resist plant disease. Barley is the world’s fourth largest cereal crop in terms of production. This important crop is at risk worldwide from the fungus, Ustilago hordei, which infects barley with a disease called covered smut. This fungal infection starts on the surface of barley seed and causes the kernels of the barley plant to be replaced by masses of brown spores. Fan Yang’s research sought to identify a gene that can prevent barley yield loss from covered smut and thus improve economic returns to farmers. “My research focused on identifying a resistance gene, called RuhQ, within the barley genome that provides long-term resistance to covered smut,” said Yang. “I investigated how the pathogen infects barley seedlings and reduces grain quality and yield. I also explored which defense pathways are activated by the RuhQ gene to help barley defend against covered smut.” In July 2025, she successfully defended her PhD thesis, A study

Pulse Market Insight #286

Another Headwind for Yellow Peas The first quarter of the 2025/26 marketing year is now over and the pea market’s performance can be described as good, considering China’s 100% tariffs on Canadian pea imports, but not great. According to the CGC, farmers’ pea deliveries through 13 weeks were 1.13 mln tonnes, below the 5-year average of 1.21 mln and last year at 1.37 mln tonnes. Licensed pea exports totaled 865,000 tonnes, slightly above the 5-year average of 855,000, but trailing last year’s strong pace of 1.05 mln tonnes. In a “normal” year, this movement of peas wouldn’t be a big concern but the 2025 pea crop is nearly a million tonnes larger than last year, including 700,000 tonnes more yellow peas. Canada needs to export more peas, not less, in 2025/26 to avoid a large buildup in ending stocks. Unfortunately, the Indian government’s recent announcement of a 30% import tariff on yellow peas (from all origins), effective November 1, won’t help the situation. Several months ago, In

FVGC executive director plans to retire

The Fruit and Vegetable Growers of Canada (FVGC) president, Marcus Janzen, has announced that Massimo Bergamini will begin a transition from his role as executive director as he moves toward retirement. The Board is grateful for his leadership and for the organizational achievements made during his tenure.

© 2025   Created by Darren Marsland.   Powered by

Badges  |  Report an Issue  |  Terms of Service