Potash Mines Stall as Food Prices Climb

"Alongside concerns about falling yields and rising food prices, potash producers are facing the short-term consequences of slow global growth and are deferring capital expenditures on new mines.

The past two weeks have seen several potash producers halt mine production or shelve plans to progress mine development in response to a softening market in which billion-dollar expansions are not feasible.

Last week, the long-suspected delay in BHP Billiton’s Saskatchewan-based Jansen project came one step closer to reality after BHP announced that it will defer new project expenditures for the remainder of the 2013 fiscal year, which ends in June of next year. Instead, the company’s CEO, Marius Kloppers, told reporters and investors in a conference call that Jansen has “pre-commitment capital of $1.2 billion that is going to keep them very busy and productively busy for the year.”

Read more from Potash Investing News