Colonsay potash mine to resume production this month: Mosaic

 

Colonsay potash mine to resume production this month: Mosaic

ALEX MACPHERSON, SASKATOON STARPHOENIX

Published on: January 4, 2017 | Last Updated: January 4, 2017 6:30 PM CST

 

Almost exactly a year and a half after shuttering its Colonsay potash mine amid an extremely weak fertilizer market, Mosaic Co. says the sprawling operation east of Saskatoon should be up and running again this month.

All of the roughly 330 employees laid off in July were back at work by Dec. 5, and the Plymouth, MN-based company anticipates that the mine will again be producing potash by mid-January, Mosaic spokeswoman Sarah Fedorchuk said in an email.

“We do not anticipate idling Colonsay this year. We expect supply reconciliation and demand growth will result in a productive operating environment and are optimistic that 2017 will be a stronger year for the potash industry.”

Mosaic said in July that it would temporarily “idle” the mine east of Saskatoon and rely instead on its Esterhazy and Belle Plaine facilities in the province — which are cheaper to operate — amid “really challenging” market conditions.

Potash prices have fallen sharply over the last eight years, to around US$200 per tonne from a peak of almost US$900 per tonne in 2008. Industry experts have predicted a rebound, driven by dwindling inventories and a growing global population.

However, low demand has already led to cutbacks in Saskatchewan’s multi-billion-dollar potash industry, with companies like Mosaic and Potash Corp. of Saskatchewan Inc. taking steps to reduce costs, including production cuts and layoffs.

Mosaic’s decision to temporarily shutter its Colonsay operation became controversial when unionized miners, who were without a contract at the time, raised concerns about voting on a new agreement while out of work.

The company said last month that its decision to acquire Vale SA’s fertilizer business, which includes a massive undeveloped potash project near Kronau, for $2.5 billion is consistent with its search for value at the “at the low points in the cycle.”

 

 

 

About prosperitysaskatchewan

Consultant on Saskatchewan's natural resources.

Posted on January 5, 2017, in economic impact, potash. Bookmark the permalink. Leave a comment.

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