By Steve Halabura
I begin with a disclaimer – this article was not written by Chat GPT, so consider the innumerable mistakes I tend to make as a badge of authenticity.
A year ago, I was bemoaning the fact that Donald Trump had levelled punitive tariffs against many Canadian products imported by America, and that this would create instability that would threaten Canadian workers, producers, and businesses. I also recall much doom speak regarding the havoc that would envelop our economy. Hope for the best, but brace for the worst, I wrote.
I was surprised – I did not expect as busy a year as it turned out to be. I found myself spending more time behind the keyboard than I had planned, and it was not just potash projects alone. Among other things, I found myself involved in the search for natural hydrogen, converting forest biomass into fuel pellets, and contributing to several economic development initiatives. The keyboard is a harsh master, and many days I found myself as tired as if I had spent the same amount of time splitting rocks with a mallet.
This work regimen left me with several burning questions:
- Why are Teams/Zoom meetings even more draining than face-to-face meetings?
- Has the AI/chip/data centre investment craze siphoned off even more capital from conventional capital markets than previous crazes (remember cannabis? And crypto?)
- Has being doused with punitive tariffs become almost a badge of honour?
- Why is potash not sexy?
Since this is a potash publication, I will leave the first three questions alone and return to number four later. But to begin with, I have several opinions on potash tariffs, to which I make two observations.
The first derives from news media reports concerning the most recent threat of “serious tariffs” to be placed on American imports of Canadian – i.e., Saskatchewan – potash, which, in the perfect phrasing of Saskatchewan Premier Scott Moe, should be “treated seriously, but not taken literally”. It seems this is also the attitude of the province’s biggest producers – Nutrien and Mosaic – whose share price did not tank during the news flow.
The second observation concerns why American intentions to replace Saskatchewan’s potash imports may be wishful thinking. Much has been made in the media that America imports 90 per cent to 95 per cent of its requirement; however, no one has asked why this is so. Is it because the industry is in a nascent phase, and the investment of additional capital will somehow vastly increase domestic production?
No, it is the opposite way around. There is not that much new potash to be had in the traditional production regions of America, like New Mexico, Utah, and Michigan. If fact, this is the reason there is a potash industry in Saskatchewan. After the Second World War, established producers from New Mexico came to Canada because their existing mines were depleted and new deposits needed to be developed. To anyone wishing to replace Saskatchewan production with new American production I can only say is: “good luck with that!”.
But, what about the rest of the world?
A year ago, Nutrien forecasted a global shipment range of between 73 and 75 million tonnes for 2025, demand forecasted to increase sales to between 74 and 77 million tonnes for 2026, for an annual growth of about 1.4 per cent. U.S. demand remains stable, between 11 to 13 million tonnes of finished product. It’s interesting to note that the positive financial outcomes for 2025 are due to “favourable affordability and limited global capacity additions due to ‘announced project delays’”. But more on that last bit further on in this piece.
From the viewpoint of Saskatchewan, what did 2025 look like?
From January to October 2025, Saskatchewan mines produced 12.5 million tonnes (K2O) or 19.8 million tonnes (KCl) of potash, as compared to January to October 2025 production of roughly the same amount. In other words, it was flat production.
Sales during the same periods were $7.9 billion from January to October 2025, as compared to $6.8 billion for the corresponding period in 2024, which is an increase of 17.6 per cent.
Realized pricing was CDN$399 per tonne (KCl) in January 2025 as compared to CDN$343.43 per tonne (KCl) in 2024, which is an increase of 14 per cent from the previous year.
This rough analysis tells us that compared to a year ago, while production rate remained flat, price per tonne increased, which demonstrates to me that 1) price is being driven upward, slightly shrinking availability in the marketplace; and 2) global supply is stable, which is where potash producers (and buyers) like it.
From the viewpoint of the established producers, what did the year look like? Let’s look at integrated fertilizer giant Nutrien, which I take to be a bellwether of the industry.
For Nutrien, sales price (FOB mine site) for the nine months ended September 30, was US$250/t, up from US$220/t during the same period in 2024, with growth shown by a Finished Product (MOP) Sales volume in Q3 2025 of 4.0 MMt, slightly up from 3.9MMt in Q3 2024.
Overall, while production volumes were slightly down from 2024, prices were up from the previous year, again supporting the thesis of stability in the marketplace without any disruption by geopolitical or supply forces.
If producers and buyers in the global potash sector crave stability, what possible factors could upend these tranquil waters?
Geopolitically, some form of rapprochement between Russia and Ukraine seems likely in 2026, which may mean that “sanctions” affecting Russian sales and shipments of goods may be restored to pre-war levels. I don’t think this will introduce much instability into supply and pricing, because people with much better connections than me are certain that Russian and Belarusian potash is entering the marketplace. Will new production ramp up, thus placing more product into the market? This depends upon the current state of Russian mine assets, and whether they have been able to maintain maintenance and production levels. Again, an assessment that is above my pay grade.
What about significant increases in supply? By this, I mean the soon-to-be-online Jansen mine, owned and built by BHP. Its construction has dominated the news over the past several years, and it is intended to make BHP the dominant force in the sector.
As reported by Mining.com in an article published on July 18, 2025, the company reported that Jansen’s first stage will cost up to 30 per cent more and come online a year later than originally planned. BHP announced it now plans to spend between $7 billion and $7.4 billion on Phase 1, up from the original USD$5.7 billion estimate. Completion was also pushed back a year to 2027.
The second stage of the project was also pushed back two years, to 2031. It temporarily paused its intended USD$4.9 billion investment in Phase 2, pending further design and cost estimation review.
Jansen is a conventional shaft and tunnel mine and is like the mines that its competitors Nutrien and Mosaic operate along the Highway 16 Potash Corridor. Such mines have always presented significant challenges in the form of shaft sinking through the notorious Blairmore formation, known for its high-capacity water flow, ground control, and mine layout once operations are at the mining level.
What is interesting is that several weeks after the Jansen news, Rio Tinto announced that it too remains a player in Saskatchewan potash; however, it was following the ways of some of the smaller potash juniors and was studying mining methods that overcome the almost impregnable barrier to entry created by a conventional shaft and tunnel mine.
Rio has quietly operated a permit north of the K+S Bethune mine for the past several years, quietly drilling resource estimation wells, and several wells designed to test what Rio calls an “unorthodox approach to extraction” at its “Texas” project.
Unlike BHP, Rio is planning to build a solution mine, which uses wells drilled from surface to penetrate the potash beds, then use a solvent fluid to dissolve the potash and bring it surface, where the potash is removed and the solvent is re-injected to dissolve more potash.
Rio was experimenting with what they call selective solution mining using oil well directional drilling and “clever science around what you use to dissolve the mineral and how you manage the flows”.
The above is directly out of the playbook of several junior potash companies (like my own enterprise, Buffalo Potash Corp.) that have been socializing this method of mining for several years, as it could very well be sufficiently revolutionary to doom any future considerations of traditional shaft mines.
Rio was careful to point out that more work is required to demonstrate the technology, and that feasibility and pilot testing remains to be done. However, the prize is significant – new selective solution mines would be a fraction of the cost of a conventional tunnel mine and could be deployed anywhere new deposits need to be developed.
I take the above to mean this: a) there will be several years of stability on the supply side of the potash equation, as no new, big tonnages are likely to appear in the marketplace; b) “announced production delays” open a runway for the nimbler, cheaper solution miners to seize market share, assuming they successfully navigate the pilot and implementation stages; and c) by 2028, the world will need probably need another 2.3 million tonnes of product, which may be fillable by existing producers, and solution miners who get their operations up and running.
In summary – look toward 2026 to be a year of steady, stable sales, with upward pressure on pricing.
In closing, I can probably go back to sleep now, and let the potash bus drive itself; however, given the past few years, maybe these are famous last words!
‘Nuff said.
