BHP sees potash heading toward deficit as demand outpaces supply
BHP Group, the world’s largest mining company, expects the global potash market to tighten over the next decade as demand grows and geopolitical risks strain fertilizer supply chains.
With demand for the crop nutrient rising 2% to 3% annually, there is limited additional supplies beyond BHP’s Jansen potash project. That adds to a fertilizer supply shock triggered by the war in the Middle East, as farmers worldwide rush to secure critical nutrients. A market deficit is expected by 2035, according to Karina Gistelinck, the group’s head of potash.
“We expect a tight market, with significant pressure on the supply side,” she said in an interview Tuesday.
Jansen, in Saskatchewan, Canada, is scheduled to begin operations in mid-2027, reaching 4.1-million tons of annual capacity within two years. A second phase would lift output to about 8.5-million tons early next decade.
Gistelinck is in Brazil seeking to convert preliminary commercial agreements into binding contracts ahead of Jansen’s startup.
The South American nation — which imports almost all of its potash — is set to be a key market, reflecting its roughly 20% share of global demand. The miner is also targeting Southeast Asia, China, India and US as major buyers.
BHP has “learned a very expensive lesson” as it has blown past cost estimates for Jansen, raising projected investment in the first phase to $8.4-billion, the executive said. She described potash as “the iron ore of the future” for BHP, signaling its ambition to build a major new earnings driver.
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