Mosaic CEO points out competitor supply woes

02 October 2008 17:45  [Source: ICIS news]

HOUSTON (ICIS news)--Mosaic CEO Jim Prokopanko said on Thursday that one of his company's largest competitors has declared force majeure (FM) on some of its shipments.

Speaking during the company's first-quarter earnings conference call, Prokopanko did not identify the competitor.

Retailers, however, have claimed as early as a month ago that Potash Corporation of Saskatchewan (PotashCorp) has backed out of some of its shipments because of a strike at three of its plants that began on 7 August. The company has refused to confirm or deny whether it had declared FM.

Prokopanko also said that some customers who had their shipments cancelled had turned to Mosaic to purchase potash, but that Mosaic did not have enough supplies to make additional sales.

“With their supply problems, some industry accounts had FM declared on them, and they [the customers] called us. We have not been able to find the extra production or inventory to serve them. That’s not something we can step in and fill,” Prokopanko said.

The global potash market is very tight, with demand far outstripping supply.

“The simple answer is no, we can’t fill some of the unmet needs right now,” Prokpanko said.

PotashCorp spokesperson Tom Pasztor declined to comment.

Since 7 August, some 500 workers at PotashCorp’s 2m tonne/year plant in Allan, 800,000 tonne/year plant in Cory and 300,000 tonne/year plant in Patience Lake have been on strike. All three facilities are in Canada’s Saskatchewan province.

Management workers from the three facilities have since been pooled together to operate the Allan plant at half capacity.

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By: David Rosen
713-525-2653

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