Canadian fertilizer makers Potash Corp. and Agrium announced Tuesday they are in talks to combine into one company, becoming one of the world’s largest producers of potash. That is already affecting the commodity’s price and may soon affect a nearby mine.
Potash is a salt, one of three essential ingredients in fertilizer. In 2015, 32 million tons were mined worldwide.
Dr. Michael Conway with the Arizona Geological Survey says when potash is used for growing crops, its price goes up.
"Just before the great recession, the price of potash went through the roof. I think it was going for nearly $800 or $900 a ton," he said. "And at that point, this potash in the Holbrook Basin became of great interest to several different companies."
Conway was talking about Arizona’s Holbrook Basin, covering 600 square miles in the east-central part of the state. Conway said the price of potash has since fallen and is not mined at Holbrook today.
New Mexico is the largest U.S. potash producer, followed by Utah and Michigan. However, if the price per ton of potash rises, Arizona’s Holbrook mine may again become attractive to global producers. Both companies in the potential merger closed trading at higher prices.
