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

Crop InputsLand O’Lakes Announces Minnesota Water Quality Partnership
May 25, 2016
Governor Mark Dayton and Land O’Lakes, Inc. President and CEO Chris Policinski today announced a new public-private partnership to protect Read More
Crop Inputs2013 West Texas Tragedy Ruled A ‘Criminal Act’ [Updated]
May 11, 2016
A 2013 fertilizer plant blast in West, TX, that killed 15 people and injured 160 others was caused by a Read More
Young Corn Field
Crop NutritionEnhancing In-Season Nitrogen Use Efficiency Is In The Details
May 5, 2016
Spring is here and crops are in the ground. Do you have a plan for your nitrogen during the growing Read More
Truck dumping dry fertilizer
FertilizerFertilizer Logistics Q&A: Southern States’ Joe Wlodkoski
May 2, 2016
Joe Wlodkoski, Director of Agronomy Procurement, Fertilizer, Southern States Cooperative, is a 40-plus year fertilizer industry veteran. He is quite Read More
Trending Articles
Eric SfiligojPity The Monsanto Haters
May 23, 2016
An old saying goes thus: “Be careful what you wish for. You just might get it.” Given current events, there Read More
Monsanto Luling Plant
Crop InputsReport: Bayer Eyeing Monsanto For Possible Mega-Merger
May 16, 2016
Bayer AG is exploring a potential bid for U.S. competitor Monsanto Co. in a deal that would create the world’s Read More
Aerial Drone
Precision AgA Deeper Dive Into The Future Of Precision Ag
May 9, 2016
For about two decades now, through the good and the bad times, the ups and the downs inherent in agriculture, Read More
Palmer amaranth in soybean stubble
HerbicidesWSSA: Billions In Potential Economic Losses From Uncontrolled Weeds
May 4, 2016
What losses would corn and soybean growers experience if they were forced to eliminate herbicides and other control techniques from Read More
Eric SfiligojReasons For Hope In Commodity Prices
May 2, 2016
For many months now, the doomsayers have ruled the day in agriculture. Too much supply with too little demand would Read More
Eric SfiligojMissing The Family Ties In Agriculture
April 25, 2016
By its nature, the agriculture market is cyclical. Up and down cycles come and go with a regular pattern. For Read More
Latest News
ManagementWashington Visit and Bayer/Monsanto Deal Update
May 26, 2016
Editors Paul Schrimpf and Eric Sfiligoj discusses a recent trip to DC and the latest news on the proposed pairing Read More
Fertilizer closeup in hand
Industry NewsVerdesian: Striking A Balance Between Yield & ROI
May 26, 2016
Finely tuned nutrient management plans are helping farmers throughout the U.S. improve nutrient use efficiency, increase return on investment (ROI) Read More
Crop InputsLand O’Lakes Announces Minnesota Water Quality Pa…
May 25, 2016
Governor Mark Dayton and Land O’Lakes, Inc. President and CEO Chris Policinski today announced a new public-private partnership to protect Read More
Soybean Plant closeup
Industry NewsMonsanto Rejects Bayer Bid; Open To More Talks
May 25, 2016
Monsanto Co, the world’s largest seed company, turned down Bayer AG’s $62 billion acquisition bid as “incomplete and financially inadequate” Read More
Corn close up
Crop InputsArysta LifeScience Establishes Global Headquarters In R…
May 25, 2016
Arysta LifeScience has announced plans to relocate its global headquarters from West Palm Beach, FL, to Cary, NC, over the Read More
fertilizer blending and storage, Top 100
BlendersCHS Dakota Expansion Features AGCO’s GSI InterSys…
May 25, 2016
The continued growth of precision agriculture has increased farmer use of customized fertilizer blends best-suited for their soil conditions. Several Read More
ManagementAgriculture 3.5: A Bumpy Road Ahead
May 24, 2016
You may have read my article a few years ago on Agriculture 3.0, which is a term I coined to Read More
Topcon’s X30 display with CropSpec sensors
EquipmentGPS Autosteer Systems: Product Updates From Precision A…
May 24, 2016
Throughout 2015 GPS Steering solutions continued to evolve from what was once an after-market add on, to today’s cab where Read More
Trimble TMX-2050 In-Cab Display
Eric SfiligojThe Precision Ag Revolution Continues
May 24, 2016
It’s funny how much “the first time” tends to mean to someone as they get older. I sometimes can’t recall Read More
Eric Wintemute, AMVAC
Precision AgAMVAC Ups The Ante With New Precision Ag Technology
May 24, 2016
A potentially industry-changing at-plant soil treatment system from American Vanguard Corp., or AMVAC, is coming soon to large growers in Read More
Dry and Liquid Plant
CropLife 100CropLife 100 Map
May 24, 2016
The new CropLife 100 map shows the locations of each of the headquarters of the 2015 CropLife 100 retailers. The interactive Read More
Southern States Cooperative
Corn Field
Industry NewsTiger-Sul Names Veteran Account Manager To Lead Central…
May 23, 2016
With the continuing growth of the sulphur bentonite and precision crop nutrient industry, global agriculture firm H.J. Baker has announced that Read More
Bayer sign
Industry NewsReuters: Bayer Defies Critics With $62 Billion Monsanto…
May 23, 2016
German drugs and crop chemicals group Bayer has offered to buy U.S. seeds company Monsanto for $62 billion in cash, Read More
Eric SfiligojPity The Monsanto Haters
May 23, 2016
An old saying goes thus: “Be careful what you wish for. You just might get it.” Given current events, there Read More
Industry NewsCompass Minerals Hires Industry Veteran To Lead Plant N…
May 19, 2016
Compass Minerals has hired plant nutrition industry veteran Vatren Jurin to steer the company’s portfolio expansion into specialty liquid micronutrient Read More
ASMARK Retailers LIVE! Tour 2016 Group shot The Andersons
CropLife 100The Andersons Rejects Unsolicited Proposal From HC2
May 19, 2016
The Andersons, Inc. has announced that its Board of Directors has rejected two non-binding, highly conditional, unsolicited proposals from HC2 Read More
glyphosate
Crop InputsWHO: Glyphosate ‘Unlikely’ To Cause Cancer
May 16, 2016
Via Reuters.com reporter Kate Kelland: The weed-killing pesticide glyphosate, made by Monsanto and widely used in agriculture and by gardeners, Read More