New Potash Corp CEO keeps output tactics
Potash Corp.'s (TSX:POT) (NYSE:POT) new chief executive said recently that he intends to continue the company's practice of supporting potash prices by trying to align output with demand.
Jochen Tilk, who took the helm of the world's second-largest potash producer on July 1 after former CEO Bill Doyle retired, said that his company's tactics are the right ones.
"There was consistency because people in the company believed that was the best way going forward and that has proven to be the case,” Tilk told Business News Network.
Potash producers, including the Saskatchewan-based firm, have in the past refrained from flooding the market with the fertilizer in order to keep prices higher.
Russian giant OAO Uralkali (MCX:URKA) undercut these efforts almost a year ago when it dissolved a cartel-like marketing partnership to maximize its potash production and obtain a bigger worldwide market share.
The move helped weaken potash prices, which hit a six-year low earlier this year, hurting Potash Corp.'s bottom line.
The sharp drop in fertilizer prices underpinned the Canadian company's weak performance last year and called its strategy of pursuing price over volume into question.