Monday, February 7, 2011

Spreading CEO Fertilizer

January 27, 2011
Potash Corp. doubles profit, vows to avoid dramatic price spike

...Potash Corp. chief executive officer Bill Doyle says price increases will be more measured than in mid-2008, when they surged to around $1,000 a tonne...



That's a surge in the chart, not a bubble. I'm not even going to mention the left side of the chart.

“I think people learned a lesson,” Mr. Doyle said Thursday. “We never, ever like to get to the position where the farmer doesn’t make a proper return. As soon as you do that, you are going to bring the whole tent down.”

People learned a lesson. I'm not sure which ones. Farmers? Potash CEOs? Russians? Chinese?

In fact, he criticized his competitors in Russia for signing an agreement to ship potash to China for $400 a tonne, which he sees as too low. While China should get a break as the world’s largest consumer of potash, “they don’t need to have that much of a better price,” Mr. Doyle said.

The CEO of Potash sees $400 potash as too low? Shocker. Thinks China shouldn't shop around? Shocker. Secretly wants roaring 1920s pricing again but "vows" to get there more slowly this time? Shocker. Oops. I said I wasn't going to mention the left side of the chart. Sorry about that.

Source Data:

USGS: Historical Mineral and Material Prices
BLS: CPI-U

4 comments:

mab said...

That surge is due to supply and demand. It all about (in)effiecient markets and value extraction.

Seriously, there's no way that the Fed would allow banks to create massive amounts of credit for commodity speculation.

And there's no way that pension funds would invest in commodities so that pensioners and workers have to pay more for goods.

And there's no way that pension funds would ever "invest" employee CONtributions in private equity companies that gut employee benefits, outsource jobs and raid pension funds.

Making sure "it" doesn't happen here!

getyourselfconnected said...

POT is a nasty bullet proof chart! Gaps up get filled with serious consolidated volume. I am not interested but I know that is a hot potatoe on the robot trades.

Verification is: CHASERS, too funny.

Stagflationary Mark said...

mab,

That surge is due to supply and demand.

I blame the Amish.

Stagflationary Mark said...

GYSC,

Pot's chart speaks volumes. ;)