POTASH PLAYS

[Max Power]

Will China Spur a 2010 Potash Rally?

By the tickerspy.com Staff
On 11:32 am EDT, Friday October 16, 2009
Reports suggest that an 860,000-ton potash deal is about to be inked.

According to Reuters, Belarusian Potash Company (BPC) is in the final stages of a Chinese supply deal. Bloomberg reports the move could signal a return in fertilizer demand, according to comments from analysts at RBC. The pricing of the 860,000-ton order has not been disclosed, but, in a separate deal, 300,000 tons will be shipped to Vietnam for $500/ton next year.

Potash-tied components of the Agricultural Chemical and Fertilizer Stocks Index are moving higher on the news, while other fertilizer stocks head south. As of this writing, all but one of the sector's stocks are positive for the week.

Potash of Saskatchewan (NYSE: POT - News), the world's biggest fertilizer producer, according to Bloomberg, is also benefiting from news that Japan's Flour Millers Association said the country may boost its wheat imports after soggy weather cut production by as much as a third.

Meanwhile, Mosaic (NYSE: MOS - News), Compass Minerals International (NYSE: CMP - News) and Intrepid Potash (NYSE: IPI - News) are all trading higher by over 1%. All three have varying degrees of exposure to the potash market.

Agrium's (NYSE: AGU - News) potash exposure may have helped carry it out of the red today. If its intraday trend continues it will likely close in positive territory.

China Green Agriculture (NYSE: CGA - News) continued its selloff Friday morning after dropping sharply into Thursday's close. The stock remains the Index's top performing component over the last week, holding onto an 8% gain.

As of this writing, the Agricultural Chemical and Fertilizer Stocks Index is dead even with the S&P 500 over the last month. It's 3.3% five-day run is enough to rank it among the top-25 tickerspy Indexes for the period.


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