The latest reports from Agrium and Potash Corp are well worth a...

The latest reports from Agrium and Potash Corp are well worth a read - backs up the fundamental drivers for 2010 recovery. Better to read the whole reports imo but below some tidbits:

http://www.reuters.com/article/pressRelease/idUS104595+22-Oct-2009+PRN20091022 Potash Corp

The market outlook section is especially worth a look.
one excerpt:
"In more mature markets like the US and Western Europe,
farmers have generated large harvests in recent years that have removed more nutrients from the soil than fertilizer applications have replaced. While the
negative impacts of these practices can be masked in the short term by excellent growing conditions "


http://seekingalpha.com/article/168374-potash-corporation-of-saskatchewan-inc-q3-2009-earnings-call-transcript

"Farmers in the Northern hemisphere relied heavily on nutrients stored in the soil to feed this year’s crops, while south of the equator they appeared to be under applying in their current planning season.

Fertilizer dealers around the world emptied their warehouses and avoided the inventory risk that led to previous write downs and losses largely associated with nitrogen and phosphate."

" Even with the challenges in the past year, the International Monetary Fund is projecting the economies of China and India will grow by 9% and 6.4% respectively in 2010. In those countries the first priority is to improve the quality of life now with luxury items but with better food.

For many people it is the first time they can afford a balanced diet, with protein from animal sources and more fruits and vegetables that puts pressure on the world’s farmers to produce more food essentially from a fixed base of agricultural land. "

"The ability to increase food production by increasing the amount of land anywhere in the world is extremely limited. To meet this growing food demand it will be imperative to replenish nutrients in the soil and maximize yields. Farmers know this and they will start feeding their soil again. The question is not if it will happen, but when the rebound will begin"

"So the margin pressure is increasing and people don’t talk about phosphate rock cost, but phosphate rock cost are also clearly going up around the world as we get farther and farther away from some of these chemical plants with rock mines, and just the transportation cost and lower quality ore and the higher impurities and so, all the beneficiation cost that you have there."

Transcript source: www.SeekingAlpha.com