Doyle predicts strong potash sales By Scott Larson, The...

Doyle predicts strong potash sales

By Scott Larson, The StarPhoenix May 17, 2012 8:43 PM

Read more: http://www.thestarphoenix.com/Doyle+predicts+strong+potash+sales/6640697/story.html#ixzz1vBM8k7N3

Potash sales are set to rebound, says Potash Corp. of Saskatchewan president and CEO Bill Doyle.

“We are going to have record export shipments in the second quarter of this year,” said Doyle, who spoke after addressing Potash Corp. Annual Shareholders Meeting in Saskatoon on Thursday.

“We see a very strong last nine months in 2012 and we see a very, very good year in 2013 as India and others returns to the market in a more fulsome way.”

In 2011 the company garnered $3.51 earnings per share on $4.3 billion in gross revenue, of which $2.7 billion came from potash.

Doyle said the company is on track to increase its capacity to produce 17.1 metric tonnes by 2015, doubling its capacity from 2003.

Since 2003 the company has committed capital spending of $7.7 billion for its potash expansion program, of which $6 billion has been spent in Saskatchewan.

“It is Saskatchewan’s time, and I think it is PotashCorp.’s time,” Doyle said.

But when it comes to added competition from proposed new mines, Doyle doesn’t see many of the projects going ahead.

He said a potash mine is hugely expensive and the time it takes to build a mine.

“The greatest barrier to entering the potash business is the time barrier,” he said. “We know there is no new greenfield mines coming at us (in the next five years).”

“The only one out there that we think has a chance — and it is going to take longer than people say — is the German project (K+S) which is a solution mine (the $3.5 billion Legacy Project near Bethune).

“We think that has a chance of happening, but it is going to be later and more expensive than what has been said.”

Doyle said costs to build such projects are going to go up in the next few years.

“We are going to see big inflation in costs, not only in raw materials but in labour. In 2013 to 2015 Western Canada is going to have a real labour pinch and that’s going to show up in some of the costs in these projects.”