Thursday, October 29, 2015

Potash Corp cutting production

Potash Corp of Saskatchewan is cutting production to bolster prices and profits.

The company is closing one of two mines in New Brunswick and won’t have enough extra potash coming from the new mine to match current production in that province for some time.

It is also going to shut down three of its Saskatchewan mines for three weeks in December.

Earlier this month Mosaic announced an eight per cent reduction of its staff at the Colonsay mine in Saskatchewan. It also cited lower fertilizer prices.

Agrium, the third partner in a Saskatchewan export cartel, announced cut-backs late last year.

Jochen Tilk, chief executive officer for Potash Corp said "we have some of the best, most efficient potash assets in the world and we continue to take steps to even further improve efficiencies and lower our costs."

Tilk recalled cuts in 2013 that reduced its production capacity by 3.5 million tonnes.

It plans to permanently close its Penobsquis mine in New Brunswick at the end of November instead of next year, part of its plan to reduce production by 500,000 tonnes during the fourth quarter.

It plans to increase production at its lower-cost Picadilly mine, also in New Brunswick.

The closure at Penobsquis affects 140 contract workers employed by Vic Progressive Diamond Drilling.

"While this will reduce production levels in New Brunswick by approximately 800,000 tonnes annual until we have Picadilly fully ramped up, it aligns with market conditions," Tilk said.

Score one for shareholders and executives' compensation, zero for customers and mine workers.