PotashCorp To Reduce Workforce By 18%

Potash Corporation of Saskatchewan Inc. (PotashCorp) has announced it is taking the difficult but necessary step to reduce its workforce in Canada, the U.S. and Trinidad by approximately 18% from current levels.

The company expects workforce reductions by region as follows:

  • Saskatchewan – approximately 440 people
  • New Brunswick – approximately 130 people
  • Florida – approximately 350 people
  • North Carolina – approximately 85 people
  • Other U.S. locations and Trinidad –  approximately 40 people

Despite confidence in the long-term drivers of its business, a significant portion of fertilizer demand comes from developing markets where growth has been less robust than expected, said PotashCorp President and CEO Bill Doyle. “This sluggish environment has been most visible in our potash and phosphate businesses, and has contributed to challenging market conditions. As a consequence, we must make some difficult decisions to ensure the company continues to be well positioned for the future,” he said.

Following a comprehensive review of business and operational needs, changes were identified to:

  •     Respond to market conditions;
  •     Reduce costs to enhance the global competitive position of the company; and
  •     Maintain operational flexibility in potash to meet anticipated future demand growth.

The changes are intended to optimize PotashCorp’s lowest-cost operations, while retaining the ability to respond to expected demand levels and product needs of its customers, Doyle said. All three business operating segments (nitrogen, phosphate and potash), as well as corporate services, will be impacted by these reductions.

“This is a difficult day for our employees and our company,” Doyle said. “While these are steps we must take to run a sustainable business and protect the long-term interests of all our stakeholders, these decisions are never easy. We understand the impact is not only on our people, but also in the communities where we work and live, and PotashCorp will work hard to help those affected through this challenging time.”

Potash prices have been sliding since mid-summer, when the biggest global producer, Russia’s Uralkali OAO, quit its export partnership with Belaruskali of Belarus and said it would seek to maximize sales volume.

Doyle said he had “no idea” when or if Uralkali and Belaruskali will return to a strategy targeting higher prices and reverse what he has called “the single dumbest thing” he has ever seen.

The turmoil in the usually tightly controlled potash industry, dominated by Uralkali and North America’s Canpotex Ltd. export group, has caused buyers to head for the sidelines to await further price reductions.

“While the (job cuts) announcement blames soft demand in developing markets, we believe the real culprit is the BPC (Uralkali-Belaruskali) break-up and the resulting price declines in both (phosphate and potash),” BGC analyst Mark Gulley said in a note to clients.

Potash demand was weak even before last summer’s spat between Uralkali and Belaruskali; buying from key importers India and China has been particularly sluggish.

Typically, potash demand grows 3% annually, but it has been flat since 2007 due to the recession, Doyle said.

He said Indian demand, influenced by government subsidies on fertilizer, is unlikely to improve much until after Indian elections this spring.

Doyle said spot Chinese purchases should resume this month. A contract between Canpotex – the export arm of PotashCorp, Mosaic Co. and Agrium Inc. – and China’s Sinofert Holdings Ltd. will likely be reached by the end of January, he said.

PotashCorp said on Tuesday it would suspend production at one of its two mills in Lanigan by year-end and cut production at its Cory operations. Both operations are in Saskatchewan. It also plans to stop production at its Penobsquis facility in New Brunswick at the end of the 2014 first quarter.

Doyle said the company will still have the ability to supply buyers with more than 10 million tonnes of potash in 2014, combining production with its large stockpiles.

He could not predict how much potash the company will produce in 2014. But he said 2013 production is likely to amount to around 7.75 million tonnes, a little over half of the company’s capacity, reflecting output curbs.

“We’ll sell exactly what we were going to sell anyway,” without the job cuts, Doyle said. “This doesn’t affect in any way our ability to service our customers.

“We just had too much capacity versus what we were seeing needed in the foreseeable future.”

Sources: PotashCorp News release, Reuters

Leave a Reply

Fertilizer Stories
FertilizerFall Fertility 2014: Forecasting Fertilizer Use
September 7, 2014
Great crops this year have tapped the soil, and fall work is definitely called for, but how challenging will that get? Read More
Aerial view of the West Fertilizer explosion site
FertilizerFertilizer Companies Blame City For West, TX, Explosion
August 6, 2014
El Dorado Chemical Co. and CF Industries contend the city failed to properly train the first responders and had insufficient protocols in place to battle the April 17, 2013, blaze at West Fertilizer Co. that triggered the explosion. Read More
FertilizerThe Fertilizer Institute: New President, Renewed Energy
February 3, 2014
Chris Jahn relishes the opportunity to lead the organization through the challenging times ahead. Read More
FertilizerA New Cycle For Fertilizer Demand
January 2, 2014
Changes in the corn market could have a major impact on the crop nutrients sector in 2014, say experts. Read More
Top 100 Articles
CropLife 100Pinnacle Agriculture Acquires Minnesota Retailer
April 14, 2015
Pinnacle Agriculture Holdings, LLC, ranked No. 6 on the CropLife 100,  has successfully acquired Liebl Ag, LLC in Ada, MN.  Read More
CropLife 100CHS, Aurora Cooperative Complete Fertilizer Storage, Grain Shuttle Loading Facility
April 13, 2015
CHS Inc., the nation’s leading cooperative and ranked No. 5 on the CropLife 100, and Aurora Cooperative (ranked No. 21) Read More
CropLife 100GROWMARK Acquires Missouri Refined Fuels Terminal
April 2, 2015
Bloomington, IL-based GROWMARK and Magellan Pipeline Co. have entered into an agreement in which GROWMARK will acquire the refined fuels Read More
CropLife 100Wilbur-Ellis Acquires South Dakota Retailer
April 2, 2015
Wilbur-Ellis Co.’s Agribusiness Division, a recognized leader in precision agriculture technology and the distribution and marketing of plant protection, seed Read More
CropLife 100The McGregor Co. Closes Smith-Kem Acquisition
April 2, 2015
The McGregor Co. — ranked No. 16 on the CropLife 100 list of largest U.S. ag retailers — has completed Read More
CropLife 100BRANDT Commemorates National Ag Day
March 20, 2015
The Illinois agriculture community gathered at BRANDT global headquarters on March 18 to celebrate National Ag Day behind this year's theme Sustaining Future Generations. Read More
Latest News
Industry NewsCHS Insurance Names New Director Of Sales
April 17, 2015
Bryan Lewis has been named director of sales for CHS Insurance, the nation’s largest agribusiness insurance broker and full-service insurance Read More
Mature Waterhemp in Corn
HerbicidesGenetic Literacy Project: There’s No Such Thing A…
April 17, 2015
Read the latest “analysis” on GMOs from Consumer Reports and you’ll “learn” that glyphosate, the chemical developed by Monsanto (its Read More
HerbicidesNew Resistance To 2,4-D Discovered In Australia
April 17, 2015
In a world-first case of herbicide resistance, researchers have confirmed that sowthistle weed in the south east of South Australia Read More
ManagementNews From RTP Company Visits and Growers Buying Older S…
April 16, 2015
Paul Schrimpf and Eric Sfiligoj discuss recent trips to the Research Triangle Park area and market seed sales trends. Read More
soybean field
StewardshipNew ASABE Standard Establishes Framework For Sustainabl…
April 16, 2015
The American Society of Agricultural and Biological Engineers (ASABE) has initiated a project to develop a new standard to establish Read More
MicronutrientsSouthern States: An Inside Look At Our Tissue Sampling …
April 15, 2015
Remember learning about the food pyramid in school? The nutritional diagram recommends the proper amount of nutrients you need on Read More
Industry NewsArysta Adds New U.S. Fungicides Marketing Manager
April 15, 2015
Arysta LifeScience North America recently hired Deneen Sebastian as its Marketing Manager for U.S. Row Crops, Fungicides. Most recently, Sebastian Read More
FungicidesVerdesian Launches Phosphite-Based Cereal Fungicide
April 14, 2015
A new, phosphite-based fungicide designed for improved suppression of deoxynivalenol (DON) in wheat and barley infected by Fusarium head blight Read More
Mature Waterhemp in Corn
HerbicidesSURVEY: Close To 90% Of Growers Battle Weed Resistance
April 14, 2015
Herbicide resistance management continues to be a priority for corn and soybean growers, and they’re working together more effectively to Read More
CropLife 100Pinnacle Agriculture Acquires Minnesota Retailer
April 14, 2015
Pinnacle Agriculture Holdings, LLC, ranked No. 6 on the CropLife 100,  has successfully acquired Liebl Ag, LLC in Ada, MN.  Read More
StewardshipFMC Corp. Joins Sustainable Agriculture Alliance
April 14, 2015
FMC Corp. has joined Field to Market: The Alliance for Sustainable Agriculture, a multi-stakeholder initiative working to define, measure and Read More
Industry NewsArysta Adds Two To Goëmar Sales Team
April 14, 2015
Arysta LifeScience North America recently announced two new additions to the Goëmar sales team: Steve Kelly, Technical Service Manager – Read More
Valley Variable Rate Irrigation
Precision AgVariable Rate Irrigation Gains Followers
April 14, 2015
Irrigation systems have had the ability to apply different amounts of water throughout a field for decades, using timers that Read More
CropLife 100CHS, Aurora Cooperative Complete Fertilizer Storage, Gr…
April 13, 2015
CHS Inc., the nation’s leading cooperative and ranked No. 5 on the CropLife 100, and Aurora Cooperative (ranked No. 21) Read More
Soybean field
Industry NewsThree Ag Co-ops Poised For Possible Merger
April 13, 2015
Following months of study and preparations, the Board of Directors for United Farmers Coop (UFC), Farmers Elevator Cooperative (FEC) and Read More
Eric SfiligojAgriculture Braces For More Belt-Tightening
April 13, 2015
Spring is in full bloom across the U.S. and ag retailers and their grower-customers are busily getting into high gear. Read More
ManagementPollinator Health and Washington, DC
April 9, 2015
CropLife America’s Kellie Bray speaks with CropLife Editor Eric Sfiligoj regarding bee health and proposed Beltway regulations. Read More
InsecticidesValent Takes On MGK Insecticide Portfolio
April 9, 2015
As of April 1, Valent U.S.A. Corp. became the exclusive provider of the MGK crop protection line of insect control Read More