Potash deposits are isolated to very few regions of the world, and are controlled by a handful of large mining companies. Most notably, Canadian, Russian and Belarusian mines account for more than 80 percent of global reserves. The remaining 20 percent is spread across 9 countries with very little coming from South America. Other insignificant sources come from the Andes in South America where small junior miners acting in accordance with small communities extract kalunite and sell it commercially for pharmaceutical and cosmetic uses.
The global potash industry is estimated to be capable of producing approximately 60 million tons in 2011.
Demand
The global potash market is driven by the demand of fertilizer. According to some estimates, 95 percent of all potash mined and extracted is used in fertilizers. Potash fertilizer is used extensively in key commercial crops such as corn, rice, soybean, palm oil and sugar cane; and biofuels, which is a new source of demand, but projected to steadily grow.
Emerging markets account for a significant source of demand. Both India and China are rapidly growing and are expected to greatly increase potash consumption. Together, the U.S., Brazil, China and India represent about two-thirds of world potash consumption.
China is the world?s largest consumer of potash, followed by the United States and Brazil respectively. China accounts for around 20 percent of global demand estimated at 9 million tons annually. In order to meet China?s large demand they are targeting domestic production capacity of 4.5 million tons and output of 3.8 million tons by 2015.
The United States? potash demand is related closely to corn acreage as the U.S. uses potash mainly for fertilizing corn, soybeans, cotton and wheat. The U.S.?s demand is expected to rise with the expanding corn market.
Brazil imports approximately 90 percent of its 7 million tones of potash needed. The majority of the potash is dedicated to helping produce sugar cane. India is also one of the largest importers of potash, accounting for 5 million tons mainly from Russia.
Pricing
Prior to 2007 potash was at a stable US $150-200/ton, and once the biofuel craze hit the market prices jumped to over US $800/ton in 2008. Subsequently, the credit crunch gripped markets and prices fell to near $300. However, after a gradual recovery prices are not at $400 with no major fluctuations in sight.
Potash mines can vary greatly in price. The deposit itself is valued according to the potassium content net the costs to get that on to a loading dock in a useable form. Other factors that affect the price of potash on a year-to-year basis include: Stocking/destocking, economic growth cycles, crop commodity prices and weather.
Currently, mined deposits are supplying a substantial amount of potash to meet global demand. However, it is predicted that by the end of this decade current mines will be inadequate to meet future demand. Now more than ever, investing in exploratory research and discovery of new deposits, both brownfield and greenfield, are critical in order to be able to meet demand and hold prices steady.
Potash has evolved into the term widely applied to naturally occurring potassium salts and the commercial product derived from them. However, not all potassium bearing minerals fall within this term, such as kalunite. Kalunite potassium alum is also a naturally occurring potassium salt, but has different commercial applications than that of traditional potash. Additionally, it is not a significant source of potash commercially mined for fertilizer production.
Posting Komentar