Fertilizer production is not only an economic driver in Canada, but it is also a critical resource for customers around the world, especially in the United States.
During the rail strike by CN Rail and CPKC in the summer of 2024, one of the majorly concerned stakeholders was U.S. farm groups based on the reliance on supplies of Canadian potash. Canadian-produced potash remains vital to the U.S.’s ability to produce enough corn for feed, ethanol production and export requirements, at a time the U.S. heightens its focus on reducing exposure to international integrated supply chains in favour of U.S. domestic supply chains.
Unlike fabrication or processing, you can’t just relocate the potash mines and the over one billion metric tonnes in reserves to a U.S. location. The 360 million-year-old deposits are where they are, which is a major economic lottery win for the province of Saskatchewan.
You also can’t just do without it, either. Potash functions as an activator for many enzymes and metabolic pathways in plants, including those for photosynthesis and protein and starch formation in grain. Potassium plays a role in the flow of water, nutrients, and carbohydrates within the plant.
With the Russian invasion of Ukraine, potash supplies have faced political barriers and views from the developed world. The largest suppliers of potash in the export market are Canada, Russia. and Belarus, with Canada being double Russia in terms of overall production.
I believe that potash exports into the U.S. will be one of the trading examples Canada will refer to routinely in its discussion with the Trump administration as “fair” trade becomes more of a focus. Although an example of (now demonized?) “nearshoring,” this is an example where it is beneficial to both countries and alternative supply options are less than preferable by the American people, and domestic production is less than substantial.
For the U.S. corn farmer, Canadian-produced potash is critical for achieving the top yields. According to StoneX, over the past three years, Canada accounts for roughly 87 per cent of potash imports by the U.S. while Russia sits at 9.5%.
