PotashCorp (POT.TO)

Wouldn’t touch this. There is a lot more supply on the market and demand has not been growing. This was part of a pricing cartel which the Russians broke. Free market pricing isn’t quite as high as what the cartel would like it to be. This gives you poor pricing and poor supply/demand.

Upgraded this morning to outperform. Stock has come back to a breakout point which is where you want to buy it. This is a support level. A good time to buy it.

Up a little over last year. On a relative basis versus a lot of other stocks on the market, it is not performing so well. Grain prices are extremely weak. Fertilizer prices are not particularly strong. Commodities are not the best place to be.

Potash had a bit of a bounce recently since the cartel broke up. There is a bit of a sentiment shift because the cartel is beginning to get its act together, the pricing for potash still seems to be fairly challenged. Given positive market sentiment, the stock could appreciate back up closer to its highs but he thinks the price is fairly valued now. It could get up to $40 at which time he would be a seller.

The problem most recently is that potash is sold through groups. It’s collusion. It is not real market price. It’s hard to make money in a stock when you don’t know where the commodity price is going. Wait until things sort themselves out.

Short term, capacity has been increased and there have been buyer strikes. The main issue is what happened in Russia and it looks like that damage is being repaired. If you see signs of that completed he would be a buyer.

It is timely now. He just bought it. Replacing fertilizer is an ongoing thing. They have to put it on every three years. There are a lot of positive developments in Potash. Cartel is put back together. Pricing is going to be better than people think. Hold it and see what the spring brings. AGU is the grocery store for potash, not the same thing. POT is the low cost guy.

Sold his holdings a few weeks ago. His research couldn’t find anything positive going forward. Concerned about the breakup of the cartel as well as concern about no Chinese or Indian buyers of fertilizer right now. If you look out over the long-term, this price of fertilizer is still very, very high.

It is very surprising what has gone on with this company. Had a lot of issues with the Russian cartel in the summer. He prefers Agrium (AGU-T). This could be a situation where you are waiting for a catalyst. He pays a lot of attention to what the market is telling him and in this case, it has been telling him not to own this stock for quite some time.

Doesn’t think the outlook for the potash industry is very good over the next couple of quarters. There was a recent announcement with regards to Chinese pricing, which was particularly favourable. Feels the street is overestimating its earnings expectations for the sector. He is Short this and paired it against Mosaic (MOS-N). This has been an interesting trade for him.

(Market Call Minute.) Potash prices remain under pressure and he thinks they will be for some time.

iShares Global Agriculture (COW-T) or Potash Corp (POT-T)? The potash situation is nowhere near being solved. The oligopoly in Russia is still a disaster. There are not a lot of people buying potash, possibly waiting for it to hit bottom, but who knows when that is going to happen.

(Market call minute.) Good company and a great area to be in but at these levels he would rather own Agrium (AGU-T).

It is probably not worth a shot at these levels. He might look at it south of $30 perhaps. An intriguing story. There is huge potential. Prefers Agrium (AGU-T) right now.

Thinks this stock is now at a point where you can really look at it and get a good value Buy on it. Nice yield. In the agricultural space, which he likes. This is the low cost and swing producer. Confident that this will rebound.