New Potash Corp CEO sticks with output strategy as competition builds
Tue Jul 8, 2014 3:03pm EDT
By Rod Nickel
WINNIPEG Manitoba (Reuters) - The new chief executive officer of Potash Corp of Saskatchewan (POT.TO: Quote) says he will stick with the Canadian company's focus on supporting the price of potash by matching output of the crop nutrient to demand, rather than maximizing sales volume to fend off competition.
Profits at Potash Corp, the world's second-biggest potash producer, have dropped sharply as potash prices hit a six-year low earlier this year. The breakup nearly a year ago of global potash trading partnership Belarusian Potash Co (BPC) accelerated the slide in price, as it created more competition among producers.
"The principle and the strategy of aligning production with demand has been a very successful one, and so therefore the answer is, there’s no reason to change that going forward," CEO Jochen Tilk told Reuters in an interview on Tuesday. Tilk, an engineer raised in Germany, replaced longtime Potash Corp CEO Bill Doyle on July 1.
Potash Corp sells potash outside North American through its Canpotex partnership with Mosaic Co (MOS.N: Quote) and Agrium Inc (AGU.TO:Quote).
Tilk said "your guess is as good as mine" on whether potash producers Uralkali OAO (URKA.MM: Quote) and Belaruskali forge a new BPC partnership, which could boost potash prices.
http://ca.reuters.com/article/businessNews/idCAKBN0FD27H20140708
