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Potash Corp. of Saskatchewan Inc. is slashing its work force by 18 per cent amid low prices for its crop nutrients and weak demand in emerging markets.
The agriculture giant said Tuesday it will cut 440 jobs in Saskatchewan, 130 in New Brunswick, 350 in Florida, 85 in North Carolina, and 40 in other U.S. regions and Trinidad.
The company is also ceasing, suspending or cutting production at several operations. Potash Corp. chief executive officer Bill Doyle said the move is an attempt to match output of potash, nitrogen and phosphate with global demand, which has been flat since 2007.
A wide range of jobs – from sales to administration and production – are being eliminated, he said in an interview.
“Despite confidence in the long-term drivers of our business, a significant portion of fertilizer demand comes from developing markets where growth has been less robust than expected,” the Saskatchewan-based company said in a statement.
The emerging markets of China and India have been big drivers in the growth of the global crop fertilizer market, as growing middle classes eat more red meat and spur the proliferation of cattle farming. To feed the livestock, farmers have been buying more fertilizer such as potash to grow grains.
But Mr. Doyle said China is now producing nearly half of its own potash. And India’s potash imports have fallen as the government there reduced subsidies for its purchase.
Potash prices tumbled this year after Russia’s OAO Uralkali quit a Belarus potash joint venture with Belaruskali in order to sell potash on its own. (The other potash cartel is the Canpotex group in North America, which includes Potash Corp., Agrium Inc. and Mosaic Co.)
Potash Corp. said in October its average realized price of potash in the third quarter had fallen by 23 per cent to $307 a tonne from the year-earlier period.
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