Out Fox The $treet

Potash trades around multi-year lows as the fertilizer markets fail to meet expectations. Belarus and Russia signal a possible cooperation that might provide some relieve to the potash market. The stock has limited upside as the company fails to produce enough earnings to cover the dividend over the next couple of years. After nearly five years of declining stock prices,  Potash Corp. (NYSE: POT )  is finally showing some signs of stability. The foundations of any rally in the stock remain shaky as the long-term supply issues aren't resolved by production cuts. Read the full article on Seeking Alpha. Disclosure: No position. Please review the disclaimer page for more details. 

Summary Potash Corp generally exceeded Q214 estimates based on strong cost controls. The potash market to remain under pressure even if new growth targets are hit. Investors should consider the recent rebound in Potash Corp a gift that is contrary to the long-term fundamentals in the main fertilizer. The latest quarterly report from Potash Corp (NYSE: POT ) shows some improvements in the fertilizers markets. In a previous article , the question was whether any value existed in the potash stocks going forward. The real concern is that large miners like Rio Tinto (NYSE: RIO ) and BHP Billiton (NYSE: BHP ) have sights clearly on establishing potash mines and expanding market in this area due to historically higher margins. Read the full article at Seeking Alpha. Disclosure: No positions mentioned. Please review the disclaimer page for more details. 

Summary Potash stocks have rebounded too much in the last year. Demand regularly fails to meet growth forecasts. Mining giants continue to explore entering the potash market. Following a year rebounding from the collapse of the Belarusian marketing arrangement, the potash stocks of Potash Corp. ( POT ) and Mosaic ( MOS ) sit in a precarious position. Investors are now bullish on the stocks, yet several market situations suggest the market doesn't have the long-term potential most continue to project. Read the full article at Seeking Alpha. Disclosure: No positions mentioend. Please review the disclaimer page for more details. 

Over the weekend, PotashCorp ( NYSE: POT     ) announced that an external mining executive had been chosen to replace longtime CEO Bill Doyle. While investors have been unhappy with the company's stock returns, the industry as a whole faces numerous fundamental issues that will override the effect of the  CEO selection. T he recent breakdown in the Belarusian potash marketing arrangement and new market entrants such as BHP Billiton ( NYSE: BHP     ) will have bigger impacts on the stock. PotashCorp is the leading contributor to the North American potash marketing organization called Canpotex. The new leader will have to stabilize demand for this arrangement with the disruptions caused by Russia and determine how to deal with  high margins for potash that are drawing global miners into the market. Read the full article here .  Disclosure: No positions mentioned. Please review the disclaimer page for more details. 

The recent potash deals with China provided the market some hope for a floor in pricing, but investors shouldn't confuse that with a recovery. The pricing for potash slumped during 2013 due to a disagreement between the Belarusian partners of Belaruskali and OAO Uralkali. The high margins afforded North American potash producers were smashed, sending shares of PotashCorp  ( NYSE: POT     ) , Mosaic ( NYSE: MOS     ) , and Intrepid Potash ( NYSE: IPI     ) down to multi-year lows. Last week, agreements from both Canpotex (the North American marketing partnership between Potash, Mosaic, and Agrium ) and Uralkali were for 700,000 metric tons of potash in the first half of 2014 at market prices. Canpotex didn't disclose the price, while Uralkali accepted a settlement of $305 per metric ton. The pricing possibly provides for a global floor for potash prices, but it in no way indicates any recovery in pricing. Read the full article ...

After several weak months of potash pricing caused by the collapse of the Belarusian Potash marketing arrangement, Potash Corp. ( NYSE: POT     ) made a decision last month to cut costs in just about every corner of the company. Considering the apparent pricing advantage of Russian producer OAO Uralkali, will those cost cuts be enough to matter? Potash is a Canadian-based fertilizer stock that controls a majority of the Canpotex marketing partnership. Both Mosaic ( NYSE: MOS     ) and Agrium ( NYSE: AGU     ) provide a smaller level of potash to what is commonly referred to as the Canadian potash 'cartel.' Besides potash, Potash Corp. mines other fertilizers including phosphates and nitrogen, but previously potash was the most important by far, providing gross margins approaching 60% and a majority of the gross profit generated by the company. Read the full article here . Disclosure: No positions mentioned. Please review the disclaim...

Last summer, fertilizer stocks plummeted on fears that the Russia-Belarus potash dispute would flood the market with cheap potash. The issue sent shares of Mosaic ( NYSE: MOS     ) and Potash ( NYSE: POT     ) plunging and didn't help Agrium ( NYSE: AGU     ) either. Fertilizer stocks have been interesting investments over the last few years with the long-term theme of demand from emerging markets not playing out. On the flip side, the dispute between Russia and Belarus brought to the surface the pricing structure in the potash market that might not be sustainable. Read the full article here . Disclosure: No position mentioned. Please review the disclaimer page for more details.