The world’s inhabitants is rising quickly and is predicted to achieve over 9.7 billion by 2050.
This case is creating optimistic fundamentals for the agricultural sector, together with the potash market. A bigger inhabitants means a lot greater quantities of meals will probably be wanted; nonetheless, with extra folks will come additional urbanization and fewer farmland with which to work, which means farmers could have no selection however to extend crop yields.
That is the place fertilizers like potash are available. Unsurprisingly, many traders are questioning what potash is and the way they’ll achieve publicity to the potash market. Learn on to seek out out extra about potash investing, and whether or not it might match into your portfolio.
What’s potash?
Potash is a time period that refers to compounds and minerals that include potassium salts. It’s naturally white or colorless, however ore generally takes on a pink or purple coloration as a result of impurities akin to clay. Most potash comes from salt left over from historical evaporated seas that lie underground.
There are a number of various kinds of potash, together with sulfate of potash (SOP) and muriate of potash (MOP), which include potassium sulfate and potassium chloride respectively.
What’s potash used for?
Potash is mostly utilized in fertilizers. All in all, 95 p.c of the world’s potash provide is used to develop meals. Potash fertilizer not solely gives important vitamins to meals, but in addition improves water retention in vegetation and strengthens their roots and stems.
SOP is used on high-value crops, akin to quite a lot of fruit and veggies, nuts, tea, espresso and tobacco, and is seen as premium high quality. MOP is extra widespread, and is often used on greens akin to sugar beets, celery and Swiss chard.
Potash provide tendencies
In keeping with the US Geological Survey’s newest information on potash, world potash manufacturing got here in at 48 million metric tons (MT) in 2024 and consumption totaled 38.8 million MT. The potash sector is affected by oversupply, and that has created decrease costs and put strain on potash producers.
The potash market has confronted volatility in recent times, significantly from geopolitical conflicts. The company estimates that in 2022 potash fertilizer demand decreased to between 35 to 39 million tons from 40.6 million tons in 2021 on account of the Russian-Ukraine struggle.
Canada stands out because the prime potash-producing nation with output of 15 million MT in 2024, the overwhelming majority of which was from the province of Saskatchewan.
Russia is the world’s second largest potash producer, with output of 9 million MT in 2024. Reclaiming its spot because the third largest producer, Belarus’ potash output rose to 7 million MT in 2024. It had fallen considerably within the prior two years, and it ranked at fourth place in 2023 with manufacturing of 4.5 million MT.
Russia’s struggle in Ukraine and its use of Belarus as a staging floor have led to export sanctions on the 2 nations, which previous to 2022 accounted for a mixed 40 p.c of world potash provide. In 2024, that determine was 33 p.c.
All eyes will probably be on the Canadian potash market in 2025 as US President Donald Trump has threatened as much as 25 p.c tariffs on all items imported from Canada into the US. Whereas he delayed the tariffs by one month in early February, it stays to be seen whether or not they’ll finally nonetheless be enacted.
Tariffs on Canadian potash would seemingly end in greater prices for US farmers and shoppers on the grocery retailer, as Canada represents greater than 86 p.c of annual US potash imports, in keeping with Josh Linville, vice chairman of fertilizer at StoneX.
“Whereas the US does produce potash, it isn’t almost massive sufficient to fulfill our demand,” Linville informed the Investing Information Community in an e mail.
Potash demand tendencies
Potash demand is predicted to climb within the coming years. Priority Analysis expects the world’s potash market to develop at a compound annual development fee (CAGR) of 4.93 p.c between 2024 and 2033 to achieve US$97.15 billion.
The agency’s analysts attribute this steady development in potash demand to rising ranges of financial improvement and rising per capita meals consumption because the world’s inhabitants continues to rise.
“The demand for potash is considerably influenced by rising economies akin to China, India, and Brazil, which have sizable agricultural industries,” the report states.
Inhabitants development is subsequently resulting in elevated urbanization and fewer out there agricultural land. Different demand facet tendencies for potash embody the expansion in sustainable agricultural practices and technological advances in agricultural science like genetically modified crops and precision farming.
By way of regional demand, Asia Pacific represents the biggest market share coming in at 38 p.c in 2023. Governments within the area are enacting insurance policies and subsidies to encourage potash use amongst farmers with a view to generate greater crop yields to feed rising populations.
The North American market is predicted to expertise probably the most speedy development over the forecast interval, with a CAGR of 5.11 p.c. On this area, potash is a needed element for sustained agricultural output as many areas of the continent have nutrient-deficient soils.
The best way to spend money on potash
For traders within the potash house and inspired by its outlook, there are a selection of entry factors for investing within the potash market, together with potash shares and potash ETFs. We check out each methods to spend money on potash under. All information and knowledge was present as of January 30, 2025.
Potash shares
There are a lot of potash shares to think about, so it is vital to do your analysis. There are a variety of publicly traded mining corporations with shares listed on main exchanges together with the TSX, ASX and the NYSE. Traders typically select to start with massive producers within the potash sector. All shares mentioned under had market caps above $5 million of their respective currencies on the time information was collected.
Main potash mining shares
BHP (ASX:BHP,NYSE:BHP,LSE:BHP)
BHP is a multinational diversified mining firm growing the Jansen potash mine in Saskatchewan. It’s set to come back on-line in late 2026, and anticipated to provide 8.5 million metric tons of potash yearly.
Compass Minerals Worldwide (NYSE:CMP)
Compass Minerals is a number one producer of SOP in North America. Its SOP plant is positioned in Wynyard, Saskatchewan, and it produces SOP utilizing large-scale photo voltaic evaporation at its Ogden operations in Utah’s Nice Salt Lake.
ICL Group (NYSE:ICL)
Israel Chemical substances Restricted (ICL) Group is a multinational specialty minerals and chemical substances firm targeted on potash, phosphate and superior specialty fertilizers. The corporate produces potash from its mines in Israel and Spain.
Intrepid Potash (NYSE:IPI)
Intrepid Potash is the one producer of MOP in the US. It operates an underground mine and a photo voltaic evaporation mine in Carlsbad, New Mexico, in addition to photo voltaic evaporation mines in Wendover and Moab, Utah.
Okay+S Aktiengesellschaft (OTCQX:KPLUF,ETR:SDF)
Okay+S is a Germany-based chemical firm and the main potash provider in Europe. The corporate additionally has manufacturing amenities in North America and South America.
Mosaic (NYSE:MOS)
Mosaic is an American chemical firm which produces and markets concentrated phosphate and potash crop vitamins. The corporate’s North America Enterprise is liable for roughly 34 p.c of estimated annual potash manufacturing on the continent, and its Belle Plaine mine in Saskatchewan is among the largest-producing potash answer mines on the planet.
Nutrien (TSX:NTR,NYSE:NTR)
Nutrien is Canada’s largest potash firm by far, shaped by means of a merger of Agrium and PotashCorp. The corporate has a potash manufacturing capability of over 27 million MT from its six potash mines in Saskatchewan.
Junior potash mining shares
Agrimin (ASX:AMN)
Agrimin is growing its Mackay undertaking in Western Australia, which it says will probably be shovel prepared in 2025. In keeping with the corporate, the Mackay undertaking comprises the world’s largest identified undeveloped mineral sources of brine-hosted SOP.
Gensource Potash (TSXV:GSP)
Gensource Potash is growing the Tugaske undertaking in Saskatchewan. As soon as in operation, the corporate estimates it is going to produce a minimal of 250,000 MT of MOP per yr.
Highfield Sources (ASX:HFR)
Highfield Sources is advancing on its near-term manufacturing stage Muga MOP undertaking in Spain. The undertaking is anticipated to provide greater than 1 million MT of MOP per yr.
Karnalyte Sources (TSX:KRN)
Karnalyte Sources is a sophisticated development-stage firm targeted on its construction-ready Wynyard potash undertaking in Central Saskatchewan.
Sage Potash (TSXV:SAGE,OTCQB:SGPTF)
Sage Potash is growing its flagship undertaking the Sage Plain potash property within the Paradox Basin of the US state of Utah. As soon as in operation, the undertaking is estimated to provide 150,000 MT of potash yearly, with plans to increase.
Verde AgriTech (TSX:NPK,OTCQB:AMHPF)
Verde AgriTech is an agri-tech firm targeted on making modern merchandise that promote sustainable agriculture. Its major asset is Cerrado Verde, which holds Brazil’s largest recognized potash deposit, with an NI 43-101 useful resource of three.32 billion MT.
Western Sources (TSX:WRX)
Western Potash, a subsidiary of Western Sources, is growing a potash answer mine at its Milestone undertaking in Saskatchewan targeted on MOP manufacturing. Milestone is near Mosaic’s Belle Plaine mine.
Potash ETFs
Those that need extra broad publicity could wish to purchase shares of an exchange-traded fund that features potash shares. Listed below are just a few to get you began.
VanEck Agribusiness ETF (ARCA:MOO)
VanEck Agribusiness ETF follows the value and yield efficiency of the MVIS International Agribusiness Index (MVMOOTR), which tracks the general efficiency of corporations concerned in lots of areas of agribusiness, together with agri-chemicals and fertilizers. The fund’s prime holdings embody Nutrien and Mosaic.
IShares MCSI Agriculture Producers ETF (ARCA:VEGI)
IShares MCSI Agricultural Producers tracks the funding outcomes of an index composed of world equities of agribusiness corporations, together with fertilizer producers. Nutrien, Mosaic and ICL Group are among the many fund’s prime holdings.
IShares International Agriculture Index ETF (TSX:COW)
IShares International Agriculture Index ETF seeks to copy the efficiency of the Manulife Funding Administration International Agriculture Index. Its prime holdings embody Nutrien, Mosaic, Intrepid Potash and ICL Group.
That is an up to date model of an article first printed by the Investing Information Community in 2016.
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Securities Disclosure: I, Melissa Pistilli, maintain no direct funding curiosity in any firm talked about on this article.
Editorial Disclosure: Sage Potash is a shopper of the Investing Information Community. This text isn’t paid-for content material.
Editorial Disclosure: The Investing Information Community doesn’t assure the accuracy or thoroughness of the data reported within the interviews it conducts. The opinions expressed in these interviews don’t mirror the opinions of the Investing Information Community and don’t represent funding recommendation. All readers are inspired to carry out their very own due diligence.
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