Demand for potash is coming back after “a year of reduced applications” — but not quickly enough that U.S. fertilizer giant Mosaic Co. plans to keep all its Saskatchewan mines running at their current pace.
Florida-based Mosaic said Tuesday it has now “temporarily curtailed” production at its potash mine at Colonsay, about 65 km southeast of Saskatoon.
Colonsay had been operating at a pace of 1.3 million tonnes per year, Mosaic said, and it plans to expand that annual output to 1.8 million to two million tonnes by late 2023 following the restart of that mine’s second mill.
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Meanwhile, though, “with demand returning slower than expected in the second half of 2022, Mosaic’s inventory levels are sufficient to meet near-term demand,” the company said in a release.
Underground work will continue toward an expected restart of both mills in early 2023, Mosaic said.
The Colonsay mine was brought back online in August 2021, after having been placed in indefinite “care and maintenance mode” in August 2019 due to what it described as “challenging market conditions” at that time.
It was brought back into service in 2021 as Mosaic also ramped up production at its K3 mine near Esterhazy, about 90 km southeast of Yorkton. The company at that time was otherwise facing reduced potash production with early closure of its nearby K1 and K2 mines due to “brine inflow conditions” at those sites.
This new curtailment at Colonsay, however, “reflects near-term dynamics and not long-term agricultural market fundamentals,” Mosaic CEO Joc O’Rourke said Tuesday in the company’s release.
“Crop prices remain strong and continue to support healthy grower economics… After a year of reduced applications, we believe farmers are incentivized to maximize yields, which should drive significant recovery in fertilizer demand in 2023.” — Glacier FarmMedia Network
