You Think the Fed Is Confusing? Look at the Potash Industry
This was just one day after POT shares closed 16% lower on the initial news. Including Wednesday's 8.3% rout shares are down almost 25% in 48 hours.
This in spite of POT receiving permission Wednesday from the Toronto Stock Exchange to purchase up to 43,345,992 shares at its discretion between Aug. 2, 2013, and Aug. 1, 2014, subject to "a maximum aggregate amount of $2 billion."
Potash intends to retire all the shares it buys as part of this big-time repurchase program. The other big-name potash producers are Mosaic Company (MOS), down over 23% in two days and Agrium (AGU) which wasn't hit as hard since it deals with a wide assortment of other agricultural products and services.
The following five-year price chart compares shares of POT and MOS. It's a sad chart but may also eventually spell opportunity for bargain-hunters and bottom-feeders.POT data by YCharts
. Stories and rumors abound concerning possible new potash coalitions forming, including a suggestion that URALL might consider joining with Belarus to form a Swiss-based trading company. Whatever happens, few analysts disagree that new global potash projects are likely to be delayed. Mark Gulley, an analyst at BGC Financial was quoted as holding out some hope about the situation. "If Uralkali and Belaruskali can settle their difference, then much, if not all of the damage from yesterday's
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