JP Morgan reports a jump in prices per ton in South East Asia.
Potash Corp. of Saskatchewan (NYSE; TSX: POT), the world's leading fertilizer producer climbed to a high of $124 on November 8, only to retreat 20 days later to $110. Israel Chemicals (TASE: CHIM), in which Potash Corp. holds a 10% stake, fell by 10% in November.
At the end of last month, Deutsche Bank downgraded Israel Chemicals to "Hold" from "Buy", saying it preferred to wait on the sidelines for now because of doubts as to whether potash fertilizer prices will top $400 per ton in 2008.
JP Morgan, on the other hand, has no such doubts. "Industry reports indicate that potash spot prices have risen by $50 to $450 per ton, (including the cost of freight) in the Southeast Asia market. We believe this is the first time potash prices have risen as much as $50 in a single transaction," it said in its fertilizer industry review published yesterday.
Published by Globes [online], Israel business news - www.globes.co.il - on November 28, 2007
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