We continue to favor fertilizer space on recovering demand – and the old adage, “you can delay but you can’t deny fertilizer applications.”
Potash is -4% on the open after reporting 4Q numbers that missed by a penny but more importantly were accompanied by a 2014 forecast that substantially trailed estimates.
You may not like Vladimir Putin or the Russian government, but we all have to eat. That is the core of the argument for investing in a new type of Russian natural-resource company on the world stage: potash and phosphate producers such as Uralkali.
Fertilizer stocks remain a cult on Wall Street as a way to get exposure to the theoretically unlimited upside potential of the agricultural business. After all, everyone needs to eat, and we trade what we know, right?
The biggest potash supplier in the euro zone is forecasting only a marginal dip in profitability this year and then sees the fertilizer boom picking right up where it left off by 2013. And the stock has gone berserk.