Q: II would like to buy NTR for long term hold but I am concerned about BHP,s possible opening of a potash mine in Canada, what are your thoughts please?
5i Research Answer:
Like oil, potash is a global commodity, and investors are well aware of new potential supply coming on stream. Yes, more supply can pressure prices, but generally demand is more important. In a cyclical business, when demand surges prices will rise as investors know about current and future supply, and this is typically reflected in setting contract prices. In other words, we would not see this new mine as reason to avoid NTR. It is cheap partially because of the global supply/demand scenario right now anyway.