jorc resource estimate, page-16

With news of POtash Corp estending mine shutdowns due to dwindling demand its easy to see why a number of ASX Potash hopefuls ELM STB AGR and POK have struggled of late. Potash and ag. stocks are being avoided lately which imo is a short term issue.

With potash prices hitting a low in late 2010 they have come up about 30% since latest being $476ton. POK are still trying to esatblish a resource so imo will be lesser affected by spot prices/demand than those already exposed. POK has much MC catch up to do if it can define a high grade resource, imo.

Obviously being a resource company it's success is directly related to the price of the commodity so needs to be followed closely.

Potash Extends Mine ShutdownsPrint Share

By: Zacks Equity Research
March 01, 2012 |Comments: 0
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POT | BASFY | MOS Potash Corporation of Saskatchewan (POT) announced that it has extended shutdowns at its Rocanville and Lanigan potash mines in the Western Canadian province of Saskatchewan. The strike has been extended by four weeks til March 31 in order to reduce inventories that are rising due to weak demand.

The Rocanville mine, which has the capacity to produce 2.8 million tons of potash a year, was shut down in December 2011. The company has extended the shutdown at the mine for the second time. The first extension was announced by the company in January 2012. However, Lanigan mine, which produces produce 3.4 million tons in a year, was closed down in January 2012. This is the first time that the company announced to extend the period of shut down at the mine.

Recently, Potash Corp. reported earnings of 78 cents per share in the fourth quarter of 2011, considerably lagging the Zacks Consensus Estimate of 89 cents per share. However, reported earnings increased 39% year over year.

For full-year 2011, earnings came in at $3.51 per share, up 80% year over year. Fourth quarter 2011 sales were $1,865 million versus $1,813 million in the fourth quarter of 2010. Fiscal 2011 sales were $8,715 million versus $6,539 million in 2010.

Although 2011 started on a positive note, it ended with weakened demand. Potash Corp. expects global shipments in the range of 55-58 million tons for the year 2012. In North America, the current cautious approach of dealers, who are managing their potash inventories, is expected to keep shipments for the first quarter of 2012 below the year-ago level.

Potash Corp. forecasts first-quarter 2012 net income per share to be in the range of 55 cents to 75 cents and earnings for the full year 2012 to be between $3.40 and $4.00 per share.

Currently, the company retains a Zacks #4 Rank, which translates into a short-term (1 to 3 months) Sell rating and we have recommended the shares of the company as Neutral for the long-term (more than 6 months). The company competes with BASF (BASFY) and Mosaic Co. (MOS).