By Christopher Hopkins, The Saint Consulting Group
A mined salt containing potassium, potash is a primarily used in fertilizer to increase crop yields. It is particularly needed in developing countries with traditional food shortages.
But, as with any mineral that must be mined, the process is not easy. Even for natural resources that assist in providing the world a sufficient food supply, some environmentalists and non-governmental organizations oppose attempts to open or expand mines. In the United States and Canada, organized groups often oppose new mining opportunities.
U.S. potash mining currently takes place in three states, while the largest known reserves are in Canada, Russia, Belarus and Brazil.
Potash is a critical ingredient in fertilizer, and demand currently surpasses supply in much of the world. The strain on supply is driven by the economic growth in China, India and other developing nations. This has resulted in increased prices for the potash over the past few years, peaking at a high of $872 per ton in 2009.
Because of its importance in helping feed the world, potash mining is also being recognized as an investment opportunity. A recent article by Troy Bayer in Seeking Alpha provides interesting background and insights into the situation and the mining companies involved.
Christopher Hopkins is senior vice president for aggregates and mining for The Saint Consulting Group, email firstname.lastname@example.org