SASKATOON, Saskatchewan (TheStreet) -- Inventories of the crop nutrient potash declined by 146,000 tons, or about 4%, in North America in November, according to Canadian fertilizer giant Potash (POT) , although the overall size of that potash stash remains severely bloated. Indeed, it's 89% higher than the five-year average.

Potash, the world's largest producer of the eponymous nutrient, puts out a report each month on potash inventories. The latest data suggest that farmers are drawing down from stocks as the economy improves.

Earlier this month, Potash CEO Bill Doyle said that customer demand had strengthened recently; he called November

the best month for potash demand

since May 2008 -- before the financial crisis.

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But the extent to which the potash inventory in North America still exceeds the average level of the last five years demonstrates how savage the downturn has been.

Like just about every other kind of business, farmers faced a double-whammy in 2008 and 2009 from the credit crisis and the recession. With bank lending shut down, with demand for their products weakening, farmers cut back on fertilizer use, sending the industry into a downturn as severe as anything since the dust bowl.

But stock prices in the cyclical ag-products sector have rallied this year ahead of a hoped-for global economic recover. Potash shares have gained 60% year-to-date and 84% from their year low of $63.65. Shares of rival


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have performed even better, rising 70.5% year-to-date and 96% from their the 52-week low.

Tuesday morning, Potash shares were trading at $117.88, up 1.1% from the previous close. Mosaic shares were at $59.81, up 1.4%.

-- Written by Scott Eden in New York


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Scott Eden has covered business -- both large and small -- for more than a decade. Prior to joining, he worked as a features reporter for Dealmaker and Trader Monthly magazines. Before that, he wrote for the Chicago Reader, that city's weekly paper. Early in his career, he was a staff reporter at the Dow Jones News Service. His reporting has appeared in The Wall Street Journal, Men's Journal, the St. Petersburg (Fla.) Times, and the Believer magazine, among other publications. He's also the author of Touchdown Jesus (Simon & Schuster, 2005), a nonfiction book about Notre Dame football fans and the business and politics of big-time college sports. He has degrees from Notre Dame and Washington University in St. Louis.