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: 90

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

U of G Researcher Receives Funding to Develop More Sustainable Wheat

A University of Guelph researcher has received government funding to help Canadian farmers grow wheat using fertilizer more efficiently while strengthening soil health and the wheat microbiome.  

Will the Iran War Make Already High Food Prices Worse? | OPINION

Food prices in Canada have been rising at a faster rate than overall inflation for the past several years. In fact, food prices are 30 per cent higher than they were a decade ago.

Prairie Swine Centre celebrates 35 years of driving innovation

Over that time, the centre has evolved into one of Canada's premier swine research facilities, delivering practical, industry-focused research that strengthens the financial position of pork producers while advancing animal welfare and environmental sustainability across the Saskatchewan and Canadian pork industries. A foundation built on industry partnership The PSC story began in 1980 when the University of Saskatchewan (USask) built the facility for its swine research and teaching program. The original operation consisted of two 100-sow and one 50-sow farrow-to-wean units, a 240-head feeder barn, and a small office and service building. However, it was in 1991 that PSC transformed into the organization it is today. In 1987, USask and the Saskatchewan Hog Marketing Commission partnered to review the centre’s operations. An advisory board including industry representatives from across Western Canada identified two critical needs: increased emphasis on grower-finisher research, and

Investing in Canada: Why Gate Matters

Canada’s cereals sector has earned a global reputation for quality, consistency, and reliability. That reputation was built over generations by farmers, researchers, exporters, and value chain partners working together to deliver premium grains to international markets. But, as global competition intensifies, maintaining Canada’s leadership requires more than tradition; it requires strategic investment. That’s where the Global Agriculture Technology Exchange (Gate) comes in. In our latest video, Gate Capital Campaign member David Hansen explains why Gate is essential to Canada’s future in global grain markets. Gate will provide the modern infrastructure and technical support that global customers expect, giving them the data, unbiased advice, and confidence they need to continue choosing Canadian cereals. Gate connects global buyers directly with Canadian expertise, showcasing the science, innovation, and collaboration behind our wheat and other cereals. By strengthening technical e

Making Every Pound Count: Nutrient Management in Corn

Fertility starts with the soil and the variables that make nutrients available to a growing crop. Know Your Soil Texture Clay – very fine, soils with >50% clay Silt – rock & mineral particles that are larger than clay and smaller than sand. Soils with >87% silt Sand – very coarse, soils with >70% sand Loam – a balanced mixture of clay, silt and sand (approximately 20-40-40) Soil texture determines a soil’s water holding capacity. Sand has low capacity to hold water and low water content at permanent wilting point (~10-15% v/v). Clay loam has a higher capacity to hold water, therefore has a higher water content at permanent wilting point (~15-20% v/v). Nutrient Balance Nutrient balance is vital to soil fertility and crop production. Nitrogen is most commonly the first and most limiting nutrient for non-legume crops, but without an adequate fertility blend with other nutrients, nitrogen use efficiency is not “maxed out” and suffers. A poorly fertilized corn crop uses just a little l

© 2026   Created by Darren Marsland.   Powered by

Badges  |  Report an Issue  |  Terms of Service