I’ve always had a kind of personal relationship with phosphates, based oddly enough on my annual trips to the beach. My family has vacationed in Ocracoke, North Carolina for over 30 years. A little island off the tip of Cape Hatteras, Ocracoke is accessible via either the “short” ferry from Cape Hatteras, or one of the “long” ferries from the mainland, leaving either from Cedar Island or Swan Quarter, NC. In years when hurricanes have damaged NC 12, the main road to Cape Hatteras, we take the Swan Quarter ferry. What does this have to do with phosphates (and what is this blog doing in the chemical industry community), you ask?
Swan Quarter is only an hour’s drive from Aurora, NC, home of Potash Corporation’s Aurora Mine, the largest integrated phosphate mining and chemical plant in the world. Also one of the biggest fossil hunting destinations on the East Coast. Since my husband and two sons are avid fossil hunters, I’ve spent more time than I can count sweating bullets in the hot North Carolina sun while the rest of my family digs in the trailings from the phosphate mine. Because on top of phosphate deposits are huge deposits of Miocene era fossils, from sharks’ teeth to walrus skulls.
Due to these family trips, I have a real affection for Potash Corporation, who funds the lovely little Aurora Fossil Museum, as well as allowing fossil hunters occasional access to the main mine site, which is amazing.
For this reason – and now I am getting down to the chemical relevant stuff – I was really sorry to hear about the tumult in the potash market this week. Due to the break up of the Russian potash cartel, potash prices plunged, as did the stock prices of Potash Corporation, Agrium, and Mosaic who together produce about 38% of the world’s supply of the fertilizer. Israel Chemicals and Germany’s K+S also suffered.
The dissolution of the Uralkali/Belaruskali cartel is bad news if you are a potash producer, but good news if you are a farmer. Estimates are that potash prices might decline to $300 or less a ton, down from the current $400, as the Russian producers increase their volume. That means farmers will pay less for this crucial nutrient. But it also means that European and North American potash producers will have to rethink their business processes and focus on profitability. Wonder if SAP might be able to help? I hope so, because I want to go back to the Aurora Fossil Museum on next year’s trip to the beach.