February '26 Farmer Fertilizer Newsletter - Potash

February '26 POTASH

NOLA Potash Price Graph

Please remember that this is looking at the cost of one short ton of potash sitting in a barge at NOLA (New Orleans, Louisiana).  Your cost is not going to be the same.  This should be looked at more in regards to the price direction rather than the actual pricing.

 

What everyone wants to know first, what do we think will happen going forward

Global

It remains to be very hard to see why global potash values would either rise or fall substantially in the short-term.  Supply and production levels continue to appear strong vs current global demand.  That should keep things fairly steady, assuming the world can stay getting along.  Therein lies the biggest danger, I think, to potash in the short-term: global politics.  We are still watching the Russia/Ukraine war closely given Russia's continued spot as the 2nd largest exporter.  China is always a wild card and with them being a major buyer, they should be watched.

Longer-term, the outlook is unchanged as well.  Assuming production increases as expected, it would take a lot to push global values higher with that many tons available.

Globally, I still think the near term markets remain relatively stable (barring unforeseen circumstances) and longer term markets should remain relatively stable to weaker on ample supplies.

However, never sleep on potash.  As soon as we think things can stay quiet, something will come out of nowhere.

 

North America

Let's talk about the fundamental POV and the emotional POV of the N.A. potash markets.

Fundamentally, there is plenty of supply and plenty of demand to meet it.  Overall, that should keep values steady, but in season demand could pressure logistics and see a bit of a price spike.

Emotionally, do not sleep on President Trump threats on Canada.  Personally, I do not think he intends to ever take that step.  I think in order to get what he wants, he lobs out something ridiculous that throws everyone off and when the dust settles, everyone is content to give him the thing in the middle that he wanted all along.  However, as soon as we think he will not do something, he will.  Even if tariffs were placed on Canada, we then have to wonder if potash would be included since it is now a "critical mineral" and part of the N.A. trade agreement.

All to say that our outlook remains mostly steady with us keeping a watchful eye on in season logistical costs that could spike for a short time.  The other eye is watching U.S. / Canada relations.  If the U.S. places tariffs on Canada that include potash, it will very likely be U.S. values rising to pay the tariff rate to keep imports coming.

 

General Global Potash Information

 

What has happened in the last 30 days?

N.A. winter programs released late (after 1st of 2026), but at solid values

If you went to your retailer/supplier before the turn of the calendar and were put off that they did not have a potash value to offer you, I am here to say that it was not their fault.

Normally, most fill programs from the fertilizer manufacturers are released before the end of the calendar year.  That gives the retail sector time to receive the values and figure out what to do with them in time for you the farmer to walk in and make year end/beginning purchases.  

2026 did not start off normally.  It was not until the first week of January that the programs were announce.

On the one hand, it really irritated me as it made an already hard discussion between the retailer/farmer even harder.

On the other hand, the prices that were rolled out were solid.

Let's get one thing right.  The prices were still high.  Given all that is going on with farming, every fertilizer price is high.

However, potash is basically in line with where grain prices sit.

If you take a glance at the ratio chart below, you will notice that the bigger red line is right in the middle of most years.  Sure, there have been other weeks/years where the ratio was better.  However, when you look at where the potash ratio value is in relation to nitrogen/phosphate products, potash starts looking really good.

Again, hopefully if you walked in to get year end pricing, your supplier was able to figure something out.  If they were not, they are not the one to blame.  I am just glad that the potash manufacturing side did not try to rally the price.

 

Renewed threats by President Trump against Canada puts U.S potash market on edge

Fortunately for global potash buyers, values have continued to appear solid and a decent value vs grain prices.  The outlook continues to be relatively stable priced with no big fears popping up.

Unfortunately for U.S. farmers, you need to watch U.S. / Canada relations because it could be devastating for your potash price.

In recent weeks, President Trump has gone back to threatening Canadian goods as he pushed back against a reported trade agreement with China.  It looks like that is something he will not take sitting down.  Personally, I do not think he has any intentions of following through with these types of threats.  These massive statements are more meant to get the attention of the counter party to show that he means business.  However, there is not guarantee that he will not follow through so we need to watch for it.

If he were to go through with the 100% tariff threat, what would that mean for U.S. potash markets?

The simple answer - U.S. values would likely rise to pay most/all the tariff rate to keep imports coming.

My POV is that politicians do not know how tariffs truly work in commodity markets like this.  They see it from a simplistic "the other guy will send me a check" perspective.  From that viewpoint, they are absolutely right and have reason to celebrate.  However, they should ask a follow up question: where did the tariff funds come from?

When you look at the pie charts below, you notice that Canada accounts for almost all U.S. potash imports.  Russia is an extremely distant 2nd with only 10% of market share.  Further, the U.S. potash market is almost entirely reliant on imports.  We have production, just not enough to cover our demand...and why would we?  Canada is the world's single largest potash producer/exporter.  As long as we maintain good relations, it is like having our own production.

So not only do we have to consider that most of our imports come from Canada and it would be difficult to rearrange our logistics to get it from elsewhere around the world, we also have to think about timing.  It is February.  A large part of the Midwest could easily start applying in 30-days.  That simply is not enough time to pivot.

All of this to say that U.S. potash buyers would have little choice but to pay the demands of the Canadian potash manufacturer.  They do not want to cut their price drastically due to the tariff.  Instead, they will basically say "you will pay the base potash price AND the tariff rate or we will ship elsewhere or slow/stop production".  U.S. potash buyers today need Canadian potash more than Canadian potash manufacturers need U.S. demand.

The end result, Canadian firms would pay the tariff...using U.S. farmer money.

Again, it seems doubtful that this will actually play out. Even if tariffs are put into place, it is far from guaranteed that potash is included.  It is now considered a critical mineral.  It is also part of the North American trade agreement.  Two very big hurdles that would need leapt before potash prices skyrocketed.

Still, do not slep on this story.  Things can change in a blink of an eye.

 

Where are current values in relation to the past

 

Bull/Bear Factors

Because no market is ever guaranteed to go higher/lower, we try to consider the factors that can sway values so that we are able to act when they occur rather than react.

• Bullish Factors
• Global relations with Russia deteriorate and effect their export flows – honestly, I do not fear this one...much.  Russia has enough "allies" that are willing to ignore U.S./western trade restrictions and penalties to comfortably offload their annual supplies.  Places like China and Brazil are more than large enough for that.  However, patience over this invasion will eventually run thin.  If that happens and the world steps up to start impacting Russia's export ability, we could see potash run.  Fear of losing the 2nd largest exporter will do that to a market.
• U.S. moves to stop trade with Canada or Russia...or both - U.S. based farmers, you better keep an eye on Trump threats/promises against Canada.  We have now seen big Don specifically threaten Canadian potash.  While that threat came and went with no action, we now know he considers that a tool.  If he decides to roll with it, he is right that Canadian potash manufacturers will pay the price...but they will pay the price using U.S. farmer dollars after the U.S. price rallies.
• With potash being the best priced fertilizer, there is a surge in spring demand – of all the major fertilizers, potash is the only one that makes sense vs grain prices, vs historical prices, etc.  It is the only one acting normally.  I do not think we are going to see a massive surge in demand because of this, but we do need to watch for it.  Also, phosphate is still very high priced.  Nitrogen prices are firming fast.  Do we see potash try to ride the wave?

• Bearish Factors
• Cash strapped farmers cut back on potash applications in an effort to save money – this is a more likely scenario.  I do not need to tell anyone here how bad 2026 looks for farm operations.  Financially speaking, it is crap.  Even though potash values have done a lot of work to stay connected to the market, that does not mean it cannot be penalized.  If farmers are suffering through cash flows, we could see spring demand/application rates lowered as a cost savings approach.
• The outlook remains that supplies go from good to better - this is one we continue to hold very close.  We continue to look at today's market and see the potash market well supplied.  We continue to look off into the distance and see a potash market that gets even more well supplied.  End of the day, that is a win for buyers.  An extremely well supplied market keeps prices under pressure as tons chase demand.
• Preplant weather across N.A. keeps farmers from the field until planting  – this is a stretch, I know.  I really couldn't come up with a solid 3rd bearish factor because I really struggle to see values lower near term.  However, if Mother Nature turns sour and keeps most regions out of the fields for much of February/March/1st half April, even if the demand is there it doesn't matter if tractors cannot run.  It is a long shot but if it happened, demand could be substantially lower and prices would feel that weight...especially as it starts eying summer.

 

Where are the current potash/grain ratio values today

• Josh Linville’s Focal Points
• Any success of the U.S./world making moves to stop/block trade with Russia - this still does not look very likely but as long as Russia continues to invade Ukraine, it needs to be watched.  Russia has been able to not only maintain many of their fertilizer exports, in some cases (urea) the numbers have risen.  However, if we see a red line crossed that ends with the world being successful in stopping Russian potash exports, that means losing some/all of the world's 2nd larges exporter.  There are a lot of tons around the world, but I'm not sure there is enough to make up that difference.
• U.S. vs the world: the tariff! - anyone else sick and tired of hearing about tariffs.  It is an almost daily discussion/conversation and there have been so many different tariffs floated that I had no idea what is real and what is not.  The U.S. gets almost all of its imports from Canada (88%) and Russia (10%).  It would be a struggle to make up those two parties.  Don't get me started on all of the different scenarios if other nations start getting involved.  Just know that tariffs rarely work as politicians believe they will.  In the case of potash, it is very likely that the farmers of the country that puts tariffs in place will be the one that pays the higher price.  If you start finding out your country is putting something in place, watch very closely.
• U.S. subsidy payments getting spent, and where - I know this is very U.S. specific, but it matters.  Overall, government payments should NOT affect the overall S&D.  However, as a friend pointed out, timing matters.  Imagine the market knows there is 500 tons of demand coming every month between January and June.  That is 3,000 tons total but spread evenly...spread evenly until government payments come out.  Suddenly, all 6 months or 3,000 tons of demand steps up right now.  That is likely going to boost price ideas.

StoneX Ratio Calculation

The ratio calculation is derived from Bloomberg historical grains values as well as fertilizer values from StoneX, NPKFAS, and Argus.

The calculation is simply dividing the fertilizer price by each grain price.

All data was sourced from StoneX unless otherwise noted.