2011 - Potash Corp Industry Overview - Complete

2005 2015F 2010
PotashCorp Potash Operational Capability

of PotashCorp and Its Industry 2011
overview
11.2mmt
17.1mmt
While parts of the world continue to deal with economic uncertainties,
some things remain unchanged: Population is increasing, people in
developing countries want better diets, per-capita arable land and water
resources are declining. Rising demand for food is placing unprecedented
pressure on global supplies and supporting higher prices for a wide range
of crops. To keep pace, farmers must grow bigger, better crops, and
fertilizer, especially potash, can help them reach that next stage of growth.
This Overview describes the industry and market conditions that infuence
our strategies and decisions today, and examines the trends that will
shape our business tomorrow.
This document contains forward-looking statements or forward-looking information (forward-looking statements). These statements are based on
certain factors and assumptions, including with respect to: foreign exchange rates; expected growth, results of operations, performance, business
prospects and opportunities; and effective income tax rates. While the company considers these factors and assumptions to be reasonable based
on information currently available, they may prove to be incorrect. Several factors could cause actual results to differ materially from those
expressed in the forward-looking statements, including, but not limited to: fuctuations in supply and demand in fertilizer, sulfur, transportation and
petrochemical markets; changes in competitive pressures, including pricing pressures; adverse or uncertain economic conditions and changes in
credit markets; the results of sales contract negotiations with major markets; timing and amount of capital expenditures; risks associated with
natural gas and other hedging activities; changes in capital markets and corresponding effects on the companys investments; changes in currency
and exchange rates; unexpected geological or environmental conditions, including water infow; strikes or other forms of work stoppage or
slowdowns; changes in and the effects of, government policies and regulations; and earnings, exchange rates and the decisions of taxing
authorities, all of which could affect our effective tax rates. Additional risks and uncertainties can be found in our Form 10-K for the fscal year
ended December 31, 2010 under the captions Forward-Looking Statements and Item 1A Risk Factors and in our other flings with the US
Securities and Exchange Commission and the Canadian provincial securities commissions. Forward-looking statements are given only as at the date
of this document and the company disclaims any obligation to update or revise the forward-looking statements, whether as a result of new
information, future events or otherwise, except as required by law.
Advantages
Learn about our strategies and
the advantages we believe will
drive our long-term growth.
06 Potash
10 Phosphate
12 Nitrogen
Agriculture
Read about the key long-term
drivers of our business and the
fundamentals for key agricultural
commodities.
16 Global Development
20 Crop Overview
26 Crop Economics
Nutrients
Understand the key success
factors and the outlook for each
of our primary nutrients.
30 Potash
39 Phosphate
45 Nitrogen
Resources
52 Potash
53 Phosphate
54 Nitrogen
55 General
57 Planting Calendar
58 Nutrient Uptake /
Removal by Crop
59 Glossary of Terms
2 Overview
Our Business Is Meeting the Worlds Need for Fertilizer
PotashCorp has built the worlds largest fertilizer enterprise by capacity on world-class
potash resources and high-quality phosphate and nitrogen assets.
As our name suggests, potash is the primary focus of our company and the driver of our
growth. We are the worlds largest producer by capacity
1
, with fve large, low-cost mines
in Saskatchewan and one in New Brunswick. Our interests in offshore potash-related
businesses in Jordan, Israel, Chile and China add depth to our global position.
As the worlds third largest phosphate company by capacity, we have large, lower-cost rock
reserves and the industrys most diversifed product line.
By ammonia capacity, we are the third largest nitrogen producer, and our high-quality,
well-positioned assets enable us to be a lower-cost supplier to the large US market.
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Potash Facilities
1 Cory SK
2 Patience Lake SK
3 Allan SK
4 Lanigan SK
5 Rocanville SK
6 Sussex NB
Phosphate Facilities
Mining/Processing:
1 Aurora NC
2 White Springs FL
Upgrading:
3 Weeping Water NE
4 Joplin MO
5 Marseilles IL
6 Cincinnati OH
7 Geismar LA
Nitrogen Facilities
1 Geismar LA
2 Lima OH
3 Augusta GA
4 Trinidad
Investments
1 SQM, Chile (32%)
2 ICL, Israel (14%)
3 APC, Jordan (28%)
4 Sinofert, China (22%)
Potash
1 Cory SK
2 Patience Lake SK
3 Allan SK
4 Lanigan SK
5 Rocanville SK
6 Sussex NB
Investments
1 SQM, Chile (32%)
2 ICL, Israel (14%)
3 APC, Jordan (28%)
4 Sinofert, China (22%)
Phosphate
Mining/Processing:
1 Aurora NC
2 White Springs FL
Upgrading:
3 Weeping Water NE
4 Joplin MO
5 Marseilles IL
6 Cincinnati OH
7 Geismar LA
Nitrogen
1 Geismar LA
2 Lima OH
3 Augusta GA
4 Trinidad
1
Refers to nameplate capacity, which may exceed operational capability (estimated annual achievable production).
Our Company
3 Overview
All Three Nutrients Important, But Potash Is Our Primary Focus
We produce a broad range of products used to make fertilizers, animal feeds and products
for industry. With the worlds increasing need for more and better food, fertilizer is the
primary driver of our growth.
Each nutrient plays a vital and specifc role in food production around the world and to
PotashCorps success but we believe our unmatched potash assets provide the opportunity
to generate the greatest gross margin with the least volatility over the long term. To leverage
our position in this key nutrient, we employ a Potash First strategy.
What makes our potash position so advantageous? We believe that farmers rising demand
for this essential nutrient gives it the greatest long-term growth prospects, that its industry
structure is unique among the three nutrients and that the barriers to entering the business
make our existing and new capacity increasingly valuable.
How Produced:
Mined from evaporated sea deposits
How Used:
Fertilizer:
Improves root strength and disease
resistance, enhances taste, color and
texture of food
Feed:
Aids in animal growth and milk production
Industrial:
Used in food products, soaps, water
softeners, de-icers and drilling muds
How Produced:
Mined from ancient sea fossils
How Used:
Fertilizer:
Aids in photosynthesis, speeds crop
maturity
Feed:
Assists in muscle repair and skeletal
development
Industrial:
Used in soft drinks, food additives and
metal treatments
How Produced:
Synthesized from air using steam and
natural gas or coal
How Used:
Fertilizer:
Builds proteins and enzymes, speeds
plant growth
Feed:
Essential to RNA, DNA and cell maturation
Industrial:
Used in plastics, resins and adhesives
Share of 2010 0ross Marg|n
P
N
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Nitrogen 2010 Phosphate 2010

Potash 2010
Our Nutrients
4
Section
Advantages
Advantages
PotashCorps growth potential increases as world demand
for potash rises. As the worlds largest potash producer
bycapacity with the majority of brownfeld expansions
under construction, we believe our unique leverage in our
namesake nutrient provides a signifcant opportunity to
increase earnings in the years ahead. We complement our
potash position with world-class phosphate and nitrogen
businesses and have strategic advantages in both nutrients.
K
P
N
of global potash capacity,
worlds largest producer
years of permitted reserves
at our Aurora facility
of lower-cost ammonia capacity primarily
supplying the large US market
20
%
30+
3.5MMT
5
Potash 6 Phosphate 10 Nitrogen 12
Advantages
6
Opportunity to Signifcantly Grow
Sales Volumes
We believe new potash supply will be required
in coming years to keep pace with rising
demand. In 2003, we began a CDN $7.5 billion
expansion program designed to raise annual
operational capability at our existing mines
to 17.1 million tonnes by 2015
approximately double our 2005 level.
By mid-2011, two-thirds of this expansion
capital was already spent and fve parts of
a nine-project program were completed. We
are continuing work on the remaining four
expansions at Cory, Allan, Rocanville and
New Brunswick.
Our operational capability is expected to
grow in each of the next four years, providing
the opportunity to signifcantly increase sales
volumes as demand for potash rises.
Largest Producer by Capacity
The structure of the potash industry is unique
among fertilizers, a result of concentrated
global reserves and signifcant barriers to
entry. In an industry with only 12 major
producers, PotashCorp is the largest, with
approximately 20 percent of global capacity.
With more mines than any other company,
we believe we are in the best position to
grow. By 2015, we expect our share of
global capacity to increase to approximately
23 percent.
Our investments in ICL, APC, Sinofert and
SQM further enhance our ability to beneft
from the projected growth in potash demand.
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Potash
Advantages
7
PotashCorp Brownfeld Expansion
Advantage
The advantage of our brownfeld expansion
program is even more pronounced when
measured against potential greenfeld mines.
PotashCorp can leverage existing
infrastructure and has a team with extensive
experience in developing potash assets,
therefore we believe our new tonnes are
being built at a fraction of the estimated
time and cost of a greenfeld mine.
Our ability to add operational capability
more quickly and cost-effectively is the
reason we believe our expansion program
is so important and holds such potential.
Greatest Relative Volume Growth
Potential
With more existing capacity and brownfeld
expansion projects under construction
than any other global producer, we consider
PotashCorp uniquely positioned to capitalize
on the anticipated growth in potash demand.
We believe our commitment to growing our
capability even through the global economic
downturn has given us a signifcant
advantage over competitors. We expect
PotashCorp will have more than half of the
new capability that comes on stream in
the next four years*, giving us the greatest
potential growth in volumes in the industry.
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Advantages
8
Opportunity to Lower Per-Tonne
Mining Taxes and Operating Costs
We also expect to achieve lower per-tonne
mining taxes and operating costs as our sales
volumes rise.
As we have increased our operational
capability, we have beneftted from the
deduction of our capital expenditures against
current potash proft taxes. As our capital
expenditure deductions decline, our proft
tax rates are expected to rise. While higher
gross margin per tonne increases the taxes
payable, we anticipate higher sales volumes
will lower our per-tonne taxes since proft
taxes are capped at 5.7 million tonnes.
Additionally, we expect that limited fxed
operating costs will be added as we increase
our operational capability, meaning that
per-tonne fxed costs should be lower as our
volumes grow.
Rising Demand Creates Potential
for Higher Prices
In 2011, potash prices have moved higher
as demand has continued to challenge the
operational capabilities of producers around
the world, reinforcing the need for investment
in new supply. In addition to upcoming
brownfeld projects, we anticipate greenfeld
production will be necessary early in the next
decade to meet growing demand, creating
the potential for prices to move higher to
encourage this more costly investment.
We believe our expansion projects will
provide the opportunity to sell more tonnes
at potentially higher prices, creating a
powerful earnings multiplier.
0
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0
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2015 2014 2013 2012
PotashCorp Prov|nc|a| M|n|ng Jax Sens|t|v|ty
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Advantages
Potash
9
Signifcant Potential for Growth
in Potash Margin
In 2011, increased sales volumes and prices
have pushed potash gross margin to near
record levels. With demand expected to rise,
we believe our expanding potash capability
provides a unique growth opportunity.
The powerful levers of selling more volumes
at higher prices, with the potential for lower
per-tonne operating costs, offer signifcant
gross margin potential in the years ahead.
Beyond the opportunity for margin expansion,
the potential for lower per-tonne mining
taxes and improved earnings from our equity
investments provides signifcant growth
potential.
Potash-Related Investments
Provide Increased Financial Value
The value of our enterprise extends beyond
our individual operations and growth
opportunities. Our investments provide
signifcant fnancial and strategic value that
we believe is often overlooked.
Like PotashCorp, we believe producers APC,
ICL and SQM are preparing to participate
in anticipated future demand growth by
expanding their existing operations. We
also expect Sinofert, Chinas largest potash
distributor, to proft from increasing demand.
As earnings in these companies grow, we
expect to beneft through higher dividends
(ICL, Sinofert) and greater equity earnings
(APC, SQM).
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PotashCorp Potash 0ross Marg|n Sens|t|v|ty
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2011 Potash 0ross Marg|n Iorecast
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Advantages
10
Integrated Rock Supply Provides
Lower-Cost Position
Access to lower-cost phosphate rock is the
basis for success in the phosphate business.
Our integrated operations at Aurora and
White Springs produce 93 percent of our
total phosphate rock requirements. Our
facility in Geismar, Louisiana, which accounts
for the remainder of our requirements,
purchases rock under contract from a global
phosphate rock supplier.
Non-integrated producers that must rely on
imports or domestic purchases for their rock
supply to produce processed phosphate
products have a signifcantly higher cost of
production than most integrated producers.
Access to Long-Lived, High-Quality
Phosphate Rock Reserves
PotashCorp is the third largest phosphate
company in the world by phosphoric acid
capacity, with mines at Aurora, North Carolina
and White Springs, Florida.
Our mines have access to long-lived,
permitted reserves which we believe is
an increasingly valuable position, especially
in North America.
Based on current reserve estimates at Aurora,
our largest phosphate operation, we can
mine at existing levels for more than 30 years,
with signifcant resource potential beyond
that time frame. At our White Springs
operation, we have a life-of-mine permit.
0
100
200
300
400
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100
800
0t|er
Arror|a
Su|ur
8oc|
Norlrterated lroducer
Scerar|o #2.
8oc| = S250/rt
Norlrterated lroducer
Scerar|o #1.
8oc| = S150/rt
lrterated lroducer
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Su|ur Arror|a 0t|er
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30
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w||te Spr|rs Aurora
PotashCorp Phosphate kock Prof||e
8ee|.e \eo| /rr.o| Cooc||, -|||||cr !crre 8cc|
l|c.er orJ |c|o||e |ee|.e e|r|||eJ orJ |c |e e|r|||eJ o c uecer|e| 3, 200.
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||re ||e | |oeJ cr o.e|oe orr.o| |cJ.c||cr |o|e c| ||e |e.|c. |||ee ,eo|.
'c.|ce. lc|o|Cc|
PotashCorp Phosphate kock keserves
65%
28%
33
1T
0
1
2
3
4
5
o
1
w||te Spr|rs Aurora
6.0
3.6

Advantages
Phosphate
11
Historically More Stable Margins in
Feed and Industrial Products
Historically, industrial and feed sales have
been less seasonal and cyclical than fertilizer
sales, increasing the quality of earnings for
our phosphate business.
While certain periods (like 2008) can offer
exceptional returns for companies primarily
leveraged to solid fertilizer markets, the
value of our diversifed product offering
becomes more pronounced in diffcult
market conditions (like 2009).
Over the long term, we believe relative
stability in the phosphate business can deliver
more value to our shareholders.
Diversifed Product Mix
PotashCorp has the phosphate industrys
most diversifed product line. The high
quality of our rock at Aurora allows us to
optimize our phosphoric acid to provide
the most proftable combination of
downstream products.
While fertilizer makes up a large portion of
our total phosphate sales volumes, we sell
a greater portion to the feed and industrial
markets than our competitors do. Few
producers globally have the high-quality
rock required to produce certain purifed
acid and feed products.
0
200
400
o00
800
1,000
L|qu|ds
So||ds
leed
lrdustr|a|
2011 2010 2009 2008 2001 200o 2005 2004
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Advantages
12
Lower-Cost Supplier to the
US Market
Accessibility to lower-cost natural gas and
proximity to markets are critical factors for
success in the nitrogen business, and we
believe our facilities in the US and Trinidad
position us well to serve the large US market.
In Trinidad, we have four modern, highly
effcient ammonia plants. With a short sailing
distance to the US, we are a lower-cost
exporter to this market.
The competitiveness of our US assets has
improved with the rapid development of
shale gas, which provides a signifcant cost
advantage compared to nitrogen producers
in Ukraine and Western Europe. We expect
to further leverage this position by investing
$158 million to resume approximately
500,000 tonnes of ammonia production at
Geismar, Louisiana in the third quarter of 2012.
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Well-Positioned to Supply Key
US Market
Nitrogen is largely a regional business and
the US is our primary market. We supply it
through the combined production from our
plants in Trinidad and the US, supplemented
to a small degree by purchased imports.
Our extensive distribution system delivers
these products to our customers.
Trinidad provides approximately two-thirds
of PotashCorps ammonia and is well situated
to service the sizable US market. Our US
plants are located in regions geographically
insulated from the highly competitive
US Gulf, which we believe allows us to better
serve local agricultural markets and industrial
buyers for which quality and security of
supply are key.
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Advantages
Nitrogen
13
Long-Term Gas Contracts
in Trinidad
Our gas contracts in Trinidad are primarily
indexed to ammonia prices, supporting
proftability when those prices rise and
helping protect margins if they fall. While
the competitiveness of our US-based nitrogen
operations has signifcantly improved in
recent years, our asset position in Trinidad
provides added stability in an often volatile
commodity.
We believe this is a long-term advantage
more than 80 percent of our average
Trinidad natural gas volumes are locked in
through 2012, and more than 60 percent
are secured through 2018.
Target Historically More Stable
Industrial Markets
Industrial nitrogen markets have traditionally
provided more stable demand and margins
than fertilizer. We have focused our nitrogen
business on these markets because of their
relative stability. In 2010, 63 percent of
PotashCorps total nitrogen sales went to
industrial customers including close to
80 percent of ammonia sales from our
US plants.
With the ability to deliver more than half of
our US-produced ammonia sales by pipeline
to such customers, we also beneft from
lower transportation and distribution costs.
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Advantages
14 Agriculture
Agriculture
Millions of people with rising incomes want to feed their
families better diets with high-quality fruits and vegetables
and protein from meat. With pressure on global crop
supplies mounting, the need to sustainably increase
production is clear and is supporting strong prices for a
wide range of crops grown globally. Farmers are responding
to these opportunities striving to increase yields by
applying more fertilizer, especially potash.
World Crop Consumption
1980
2.2 billion tonnes
2000
3.4 billion tonnes
2020F
4.9 billion tonnes
Source: USDA
15
Global Development 16 Crop Overview 20 Crop Economics 26
Agriculture
16
Large Developing Countries Lead
Economic Growth
In many cases, the countries where
population is rising dramatically are also
leading global economic growth, and their
economies are expected to continue to
thrive. While there will always be fuctuations,
the long-term potential of large developing
countries such as China and India is expected
to have a signifcant impact on global
economic growth for decades to come.
As economies grow and incomes rise, the
priority for most people in emerging nations
is to improve their diets. We expect that
ongoing economic growth will continue to
improve the affordability of and desire for
more and better food.
Signifcant Urban Growth in
Developing Countries
Each year, the global population grows by
about 75 million. By 2020, almost 800 million
people more than twice the number in
North America today are expected to be
added to the current world population. It is
a simple reality that more people mean more
food must be produced.
While population has grown at a steady
pace, its composition is changing. Most
growth is occurring in developing countries
and, more specifcally, in urban areas.
Urban dwellers today account for around
half of the world population, but this share
is expected to rise to more than two-thirds
by 2050. This is an important shift as urban
consumers tend to eat higher-quality diets
that include meat, fruits and vegetables.
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Agriculture
Global Development
17
Rising Population Places Strain on
Existing Land Base
As populations rise and urban areas expand,
less arable land per person is available for
agriculture. This trend has been occurring for
decades and is expected to continue, given
the worlds fnite land base and projected
growth in population.
The strain on arable land is most pronounced
in developing countries, where less than
0.2 hectares per person is available for crop
and animal production. These are also the
countries with the greatest need to raise
food production, which highlights the
importance of increasing crop productivity
on a long-term basis.
Food Consumption Increasing,
Diets Better Balanced
The shift towards more-balanced diets is
evident in many developing countries. In
China, a signifcant increase in the daily
intake of fruits, vegetables and protein from
meat, eggs and fsh continues to displace
starch-based diets.
In India, the movement to more balanced
diets is just beginning. Fruits and vegetables
are becoming a bigger component of the
daily diet and protein consumption has slowly
started to rise.
While consumption levels in these countries
are unlikely to soon approach those in
developed countries, the process of improving
diets in these nations is expected to be a
long-term driver of global food demand.
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Agriculture
18
Opportunity to Increase Yields
in Developing Countries
The Food and Agriculture Organization of
the United Nations (FAO) projects that
approximately 90 percent of growth in global
crop production over the next 40 years will
come from improvements in yield and
increasing cropping intensity. The greatest
opportunity will be in developing countries
where yields currently lag those in the
developed world.
While this process will not occur overnight,
we expect the adoption of best management
practices in these countries will lead to
signifcant yield improvements over time.
These practices include the use of balanced
fertilizer applications, improved seed
technology, greater mechanization and
more effcient irrigation systems.
Pressure on Water Supply Increases
as Populations and Economies Grow
Not only is land constrained, water availability
is becoming an increasingly important issue
in many countries. In the developing world,
renewable water resources per capita have
declined by more than 50 percent over the
past four decades. The strain on water supply
has occurred amid rising demand for
agriculture and industrial purposes.
The competition for available water is
unlikely to abate as populations expand and
economies grow in developing countries.
It will be vital that agriculture use its share
effciently, and potash which helps plants
retain water is expected to play an
important role in achieving this.
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Agriculture
Global Development
19
Developing Countries Lag
US Corn Yield Progress
The disparity in corn yields between the
US and developing countries highlights the
importance of best management practices.
In the US, the use of balanced fertilizer
applications and other best management
practice has contributed to signifcant
yield growth.
Yields in most developing countries are a
fraction of the US total and have been
constrained primarily by less advanced farming
practices. Indias corn yields, for example, are
approximately one-quarter of those in the US,
much like the yields achieved there in 1940.
Need for Balanced Fertilizer
Application
Research has shown that more than
40 percent of the worlds food production
can be attributed to fertilizer use. Obtaining
the right application balance among nitrogen,
phosphate and potash is key to ensuring a
plant achieves its full potential.
Fertilizer application rates on corn in
developing countries, in particular the use
of potash, are a fraction of those in the US.
We believe that better fertilization practices
will play a signifcant role in improving yields
in these countries.
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Agriculture
20
Grain Inventories Expected to
Remain Tight Beyond 2012
Multiple production defcits over the past
decade have pulled grain inventories well
below their historical level. This is not a
sustainable situation and provides little
margin for error in meeting the challenge
of anticipated rising world demand.
We believe replenishing global grain
inventories will require renewed commitment
to high-yield farming, including proper
fertilization. Crop production next year will
need to be nearly double the historical
average just to maintain inventories at their
current low levels and must triple that
average to make a positive impact on
grain supplies.
Grain Production Has Not Kept
Pace With Rising Demand
The need to increase food production is not
a new story. Grain consumption has been
rising steadily for decades and is projected
to exceed production in 2011 for the eighth
time in 12 years.
In 2011, grain production is forecast to
increase by almost 4 percent but is still
expected to fall short of world demand. We
believe that simply achieving good yields is
no longer adequate to meet long-term
growth in demand.
10
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Stoc|stouse Scerar|o 3
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Agriculture
Crop Overview
21
Mandated Ethanol Use Expected
to Support Strong Corn Demand
The US corn crop represents nearly 40 percent
of total world production, and most of it is
used for food and animal feed. However,
rising demand for alternative fuel sources over
the past decade has meant that more corn
has been dedicated to ethanol production.
In 2011, ethanol is expected to account for
approximately 39 percent of total corn
usage. Despite concerns around the potential
removal of tax credits and import tariffs,
government mandated blending levels remain
in place and support signifcant demand for
corn-based ethanol.
With strong demand and less than ideal
weather in key producing regions, corn
stocks-to-use ratios could reach record low
levels in 2011/12.
Strong Demand Has Tightened
Corn Stocks
Corn is a staple crop used primarily for food
and animal feed purposes and accounts for
nearly 50 percent of the worlds total grain
consumption and production.
The US and China are the two largest
producers with nearly 60 percent of total
global production. Despite signifcant
increases in acreage and yields in the US,
strong growth in consumption continues
to pressure global supply.
Although it is the second largest producer,
China represents only a small percentage
of global corn trade. However, its rising
livestock production has been a major factor
in its recent shift from major exporter to net
importer of corn. Its imports are expected to
increase in the years ahead.
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Agriculture
22
Asian Countries Are Signifcant
Players in Vegetable Oils Markets
Not only are people in developing countries
striving for more balanced diets, their demand
for the oils required to add nutritional value
and favor to the food they eat is growing.
Over the past decade, the production of
vegetable oils (the category that includes all
edible oils) has more than doubled. With
more than 70 percent of the worlds total
production of palm oil, Southeast Asian
countries such as Malaysia and Indonesia
have become signifcant players in the global
vegetable oil market. Crops grown to produce
these oils have signifcant requirements for
nutrients, especially potash.
Growth in Soybean Production
to Meet Chinas Rising Demand
When it comes to soybeans, the US, Brazil
and Argentina are key. Together, they
account for more than 80 percent of
world supply.
Chinas rising demand for high-protein
animal feed and edible cooking oil has been
the primary driver behind the explosive
growth in its soybean imports more than
14 percent per year over the past 10 years.
Most of this growth has been met by a rapid
rise in soybean acres in Brazil and Argentina,
where production has increased by more
than 70 percent over the last decade.
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Agriculture
Crop Overview
23
Growth in Chinas Demand Driving
Increased Cotton Imports
China, India and the US account for
approximately 62 percent of the worlds total
cotton production. Although only 2 percent
of global acreage is dedicated to this crop, it
accounts for approximately 4 percent of total
fertilizer demand.
With the growth of China as a key
manufacturing region including the
production of clothing products its cotton
imports have risen more than eightfold over
the last two decades.
Concentration Among a Few
Wheat and Rice Exporters
Wheat and rice are typically referred to as
the staples in most diets. The move away
from starch-based diets has slowed
the growth in consumption, but rising
populations and increased demand for
wheat as animal feed are expected to
continue to require higher production of
both these important staples.
Global wheat and rice trade is concentrated
among a few large producing regions. The
former Soviet Union and the US are the major
wheat exporters while rice trade is dominated
by Thailand and Vietnam. Given their share
of global trade, variability in production levels
and government export policies in these
countries can have a signifcant impact on
the global marketplace.
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Agriculture
24
Signifcant Growth in Fruit and
Vegetable Production
The drive to improve diets in the developing
world has had a profound impact on global
production of fruits and vegetables, which
has risen by nearly a third over the past
decade. China has signifcantly increased its
production capacity for these typically
high-value, high-return crops to keep up
with growing domestic consumption and
capitalize on export opportunities to the
developed world.
Fruits and vegetables are important crops
for the fertilizer business as they are large
consumers of all nutrients, especially potash,
which aids in the maturing process and helps
enhance color, taste and texture.
Pressure on Brazilian Producers
to Meet Rising Demand for Sugar
While sugar is an important crop for
farmers in India, rising world demand for this
commodity has also given farmers in Brazil
signifcant incentive to increase acreage and
fertilizer consumption on land currently used
for sugar cane.
Brazil is the largest producer of sugar in the
world, accounting for almost one-quarter
of total production. More than half of its
sugar cane crop is used to produce ethanol
a proftable industry started in Brazil more
than 30 years ago and the demand for
sugar for both food and fuel usage is expected
to rise in the years ahead. Since sugar cane
is a signifcant consumer of potash, rising
demand for the crop is expected to
signifcantly impact Brazils need for potash.
0
500
1,000
1,500
2,000
2,500
3,000
0t|ers
8ra/||
uS
N|er|a
lrd|a
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2011l 2001 1991
0
20
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o0
80
100
120
140
1o0
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0t|ers
Ar|ca
westerr As|a
Sout| Last As|a
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2011l 2001 1991
'0t|ers' 8 'Ar|ca'
ra|e sare co|or to corb|re.
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0
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|||||cr !crre
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$TC\KN4CY5WICT&GOCPF
Agriculture
Crop Overview
25
Cocoa Production Concentrated in
Africa and Southeast Asia
Cocoas production and import profle is
very similar to that of coffee. Production is
highly concentrated among the 10 largest
producing countries, which account for
94 percent of the world total, and imports
are primarily dominated by the EU and
the US.
While Africa is not a dominant producer
of many of the major world crops, it is a
signifcant producer of cocoa. Cte dIvoire
(Ivory Coast), Ghana, Nigeria and Cameroon
together account for more than 60 percent
of world production. With the expectation
that agricultural practices and production
will continue to improve in the decades
ahead, Africas potential fertilizer demand
is signifcant.
Brazil Is the Leading Coffee
Producer and Exporter
Coffee requires a specialized climate and
conditions and, as a result, the top
10 producing countries account for more
than 80 percent of world production. Brazil,
Vietnam and Colombia together produce
the majority. With coffee prices at or near
record levels, growers around the world are
striving to maximize production through
improved fertilizer usage to capitalize on the
unprecedented economic opportunity.
Most global coffee trade is concentrated
around developed countries, with the EU
and the US accounting for more than
two-thirds of total imports.
0
1
2
3
4
5
0t|ers
Careroor
N|er|a
u|ara
lrdores|a
Cte d'l.o|re
2011l 2001 1991
0t|ers
ur|ted States o Arer|ca
Ha|a,s|a
Lu
wor|d Cocoa Prof||e
|||||cr !crre
0t|ers
Careroor
N|er|a
u|ara
'c.|ce. u'u/, l/0
lrdores|a
Cte d'l.o|re
Product|on Import Prof||e
Lu
Ha|a,s|a
55%
13%
11%
21%
0t|ers
uS
!c|o| 200 |rc|| e||ro|e - 3. r||||cr |crre
0
2
4
o
8
10
0t|ers
lrd|a
lrdores|a
Co|orb|a
v|etrar
8ra/||
2011l 2001 1991
0t|er
lapar
ur|ted States
Lu
wor|d Coffee Prof||e
|||||cr !crre
0t|ers
lrd|a
lrdores|a
'c.|ce. u'u/, l/0
Co|orb|a
v|etrar
8ra/||
Product|on Import Prof||e
Lu
uS
45%
24%
T%
24%
0t|ers
lapar
!c|o| 200 lrc|| - o.3 r||||cr |crre
Agriculture
26
Crop Returns Expected to be Well
Above Historical Levels
Higher crop prices have supported
exceptionally strong farmer economics in
most key growing regions.
In Malaysia, rising palm oil prices have nearly
tripled grower revenues, far exceeding the
rise in variable production costs. Returns for
key crops grown in Brazil have approached
record levels in 2011. Soybeans, the largest
potash-consuming crop in Brazil, are
projected to provide returns roughly twice
the previous fve-year average.
Higher crop prices have resulted in substantial
growth in US farm returns. In 2011, US corn
grower returns over variable costs are forecast
at more than $600 per acre.
This economic incentive has supported an
increase in fertilizer consumption in each of
these key regions.
Broad Strength in Global
Crop Prices
One of the keys to meeting the worlds
food needs is to ensure that farmers have an
economic incentive to increase production.
This requires crop prices at supportive levels,
not for short periods as has occurred in the
past but on a sustained basis.
In 2011, prices for many crops have
approached or exceeded record levels. This
strength extends beyond the traditional grains
and oilseeds, as key fertilizer-consuming
crops such as sugar, cotton and coffee also
have signifcantly higher prices.
0
400
800
1,200
1,o00
2,000
8e.erue
8eturr 0.er var|ab|e Costs
11l 10 09 08 01 0o 05
0
100
200
300
400
500
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8e.erue
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8e.erue
11l 10 09 08 01 0o 05
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var|ab|e Costs
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8e.erue
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var|ab|e Costs
u'S//c|e
/CNC[UKC1KN2CNO
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50
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11 10 09 11 10 09 11 10 09 11 10 09 11 10 09 11 10 09 11 10 09
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10,ear
A.erae
\eo||cJo|e o c l.|, 20
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Agriculture
Crop Economics
27
Balanced Fertilization Can Provide
a Signifcant Economic Return
Balanced fertilization is critical for any crop
to achieve its full yield potential. Long-term
trials illustrate the signifcant yield beneft
from applying recommended levels of potash
in conjunction with nitrogen and phosphate.
In the case of oil palm in Malaysia, potash
accounts for up to 45 percent of the yield
potential. The impact is similar for other key
crops such as corn and soybeans.
We believe strong prices for crop commodities
have increased the long-term economic value
of applying potash, and encourage growers to
improve the fertility of their soils.
Expect Fertilizer Cost Percentage
Will Remain Below Historical Levels
Strong prices for a number of crops grown
globally have driven down the cost of
fertilizer as a percentage of revenue. Based
on current prices for corn and fertilizer, the
cost of nutrients as a percentage of crop
revenue is expected to remain well below the
historical average for the 2012 crop year.
We believe this makes the situation much
more sustainable than in 2008 when
fertilizer costs increased dramatically. It also
provides greater opportunity for improved
nutrient prices particularly for potash,
where supply/demand fundamentals are
expected to be tightest.
0
5
10
15
20
25
30
35
40
45
50
uS
Corr
8ra/||
So,bear
Ha|a,s|a
0|| la|r
0
2
4
o
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5\ear A.erae
2011
uS
Corr
8ra/||
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Ha|a,s|a
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le|cer|
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5\ear A.erae
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5
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30
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10\ear A.erae
Scerar|o 3
Scerar|o 2
Scerar|o 1
u|stor|ca|
2012l 2011l 2010 2009 2008 2001 200o 2005 2004 2003 2002 2001
Iert|||ter Cost Percentage of 0S Corn kevenue
le|cer| u|stor|ca|
)DUP3ULFH
6FHQDULRV
(e| |.|e|
S5.00
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ST.00
'cero||c |oeJ cr l08 ||JWe| c|o| ||ce c SS90/'!, Cer||o| l|c||Jo u/l ||ce c So00/'! orJ \0L/ .|eo ||ce
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10\ear A.erae
Agriculture
28 Nutrients
Nutrients
As demand for food rises, so does the requirement for crop
nutrients. While all three nutrients work best together to
ensure the health of the plants they nourish, we believe
the greatest opportunity for PotashCorp lies with our core
nutrient, potash. Demand for potash is expected to grow
the fastest in coming years because it has been historically
under-applied relative to the other primary nutrients. Whats
more, high-quality, economically viable deposits are rare
and barriers to entering the business are signifcant.
6QVCN(GTVKNK\GT&GOCPFs/KNNKQP0WVTKGPV6QPPGU
(
Source: Fertecon, IFA, PotashCorp

29
Potash 30 Phosphate 39 Nitrogen 45
Nutrients
30 Nutrients
Economically Mineable Deposits
Are Geographically Concentrated
High-quality, economically mineable
deposits are geographically concentrated
and, as a result, potash is produced in only
12 countries. Canada, Russia and Belarus
together account for just over two-thirds
of global capacity and, according to the
United States Geological Service, almost
90 percent of estimated reserves. The
Canadian province of Saskatchewan has
almost half of world reserves and 35 percent
of global capacity.
Conventional Mines Account for
Most Potash Production
Potassium chloride (KCl), commonly called
potash, is mined from ore deposits located
deep underground or extracted from salt
lakes or seas.
Conventional underground mines account
for almost 80 percent of global potassium
chloride capacity, and underground solution
mines for approximately 6 percent. The
remainder is obtained by harvesting natural
brines from potassium-rich water bodies,
typically using solar evaporation.
Potash is sold for the agricultural market
primarily as solid granular and standard
products. Granular product has a larger and
more uniformly shaped particle that can
be easily blended with solid nitrogen and
phosphate fertilizers and is typically used in
more advanced agricultural markets such as
the US and Brazil.
Canada 46%
kuss|a 35% 0ermany 2%
8e|arus 8%
8rat|| 3%
Ch|na 2%
Israe| 0.5%
0S 1%
Ch||e 1%
Iordan 0.5%
wor|d Potash keserves
'|o|e c Wc||J' c|o| |ee|.e, |ee|.e o |rJ|co|eJ |, ||e u' Cec|c|co| '.|.e,
0||e| cc.r|||e |c|o| e|cer|.
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5GRCTCVG2QVCUJ
(TQO5CNV
Potash
31
Greenfeld Projects Require
Signifcant Investment
Entry into the potash business carries
substantial risk because of the signifcant
cost to build new supply. We estimate
that CDN $4.1 billion would be needed to
develop a conventional 2-million-tonne
greenfeld mine and mill in Saskatchewan.
Surface facilities make up the largest portion
of the required investment, and would be
similar for any mining method.
Developing the necessary infrastructure
outside the plant gate (including rail
capabilities, utility system and port facilities)
and the potential purchase of a deposit
could push the total cost of developing a
greenfeld mine above CDN $6 billion.
Major Consuming Markets Are
Heavily Dependent on Imports
Not only are potash deposits geographically
concentrated, the major offshore consuming
markets in Asia and Latin America have
little or no indigenous production capability
and rely primarily on imports to meet their
needs. This is an important difference
between the potash business and the other
major crop nutrients. Trade typically
accounts for approximately 80 percent of
demand for potash, which ensures a globally
diversifed marketplace
The large producing regions of Canada
and the former Soviet Union have small
domestic requirements and therefore are
signifcant exporters.
0
1
2
3
4
5
o
1
!ota| Acqu|s|t|or
o uepos|ts
ue.e|oprert o
lrrastructure
Surace
lac|||t|es
H|re
ue.e|oprert
Lst|mated 0reenf|e|d Potash Cap|ta| Costs
Cu\S 8||||cr
lrrastructure ard
lotert|a| uepos|t
lurc|ase
H|re ard H|||
S1.18
S3.08
S0.6M
S1.28
S0.0M
S1.08
S4.18
S0.68
S2.28
S4.T8S6.38
8oeJ cr 2rr|e|,eo| ccr.er||cro| r|re |r 'o|o|c|eWor, cc| cc.|J .o|, JeerJ|r cr ccr.er||cro|
.. c|.||cr r|re, Je|| c c|e |cJ,, ec|o||c |cco||cr orJ c||e| oc|c|. lrc|.Je eco|o||cr, ccr||rerc, orJ
cWre| cc|.
ueerJer| cr ec|o||c |cco||cr, occe orJ J||orce |c c||. lrc|.Je |o||co|, .|||||, ,|er, c|| oc|||||e, e|c.
8oeJ cr .|||c|, |ec||eJ cc| c |ecer| .|c|oe.
'c.|ce. /|LC, lc|o|Cc|
As|a
3.9
3.3
19.0
22.5
IS0
10.2
16.6
North Amer|ca
8.6
2.2
5.5
0.T
Lat|n Amer|ca
M|dd|e Last
0.8
Afr|ca
0.5
Ucean|a
5.3
6.T
Lurope
1PUBTI5SBEF
%PNFTUJD4BMFT
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T8%
wor|d Potash Product|on and 0emand
|||||cr !crre rC| - 200 1SPEVDUJPO
%FNBOE
1PUBTI5SBEF
%PNFTUJD
4BMFT
Nutrients
32 Nutrients
PotashCorp Is the Largest Producer
by Capacity
PotashCorp is the industrys largest producer,
accounting for approximately 20 percent of
global capacity. This position is strengthened
by our investments in other potash producers
around the world: ICL, APC, SQM and
Sinofert (through its ownership stake in
Qinghai Salt Lake Potash).
We supply the export market primarily
through Canpotex, the offshore marketing
agent for the three Saskatchewan producers.
Including exports from our New Brunswick
mine, Canadian producers account for
approximately 37 percent of global trade.
Following the merger of Uralkali and Silvinit
in 2011, exports from producers in Russia
and Belarus will be handled by Belarusian
Potash Company (BPC).
Building New Potash Supply
Requires Signifcant Time
The extensive time required to develop new
supply is also a major consideration in potash
capacity investment decisions. We believe it
would take at least seven years from the start
of development to achieve full operational
capability, assuming no major permitting or
construction diffculties.
Existing infrastructure can be leveraged in
brownfeld expansions, so they typically take
less time than a new mine. After construction
is complete, however, both require extensive
ramp-up which can take at least two years
for greenfeld and some major brownfeld
projects. This fact is often underestimated in
evaluations of potential potash projects.
0UIFS
,4
#FMBSVTLBMJ
6SBMLBMJ
42.
"1$
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"HSJVN
.PTBJD
1PUBTI$PSQ
0UIFS
&VSPQF
.JEEMF&BTU
'46
$BOBEB
wor|d Potash Producer and Lxport Prof||e
Percentage of 2010 kC| Capac|ty
u|o|o|| |e|eer| ||e re|eJ er|||, c u|o||o|| orJ '||.|r||
lc|o|Cc| |r.e|rer|. lCL (4, /lC (28, '0| (32 orJ '|rce|| (22
8oeJ cr rore|o|e cooc||,, W||c| ro, eceeJ ce|o||cro| coo|||||, (e||ro|eJ orr.o| oc||e.o||e |cJ.c||cr |e.e|.
'c.|ce. le||eccr, C8u, ll/, lc|o|Cc|
.PTBJD
"HSJVN
*$-
"1$
1PUBTI$PSQ
20%
14%
1T%
14%
8%
8%
9%
3%
4% 3% 6SBMLBMJ
#FMBSVTLBMJ
42.
0UIFS
,4
Percentage of 2010 kC| Lxports
$BOBEB
3T%
36%
13%
10%
4%
'46
&VSPQF
0UIFS
.JEEMF
&BTU
*
)TGGPHKGNF&GXGNQROGPV6KOGNKPG
8oeJ cr 2 rr| ccr.er||cro| r|re |r 'o|o|c|eWor, cc.|J .o|, JeerJ|r cr Je|| c c|e |cJ,, ec|o||c |cco||cr, e|c.
'c.|ce. lc|o|Cc|
&GXGNQROGPV6KOGNKPG Year 1 Year 2 Year 3 Year 4 Year 5 Year Year 1 Year 8
Viueral Lease
Lxploratiou
Luviroureutal
lufrastructure
head lrare/Shaft Siukiug
Viue 0evelopreut/8arpup
Lugiueeriug 8 0esigu
Coustruct Vill
Potash
33
Shorter Shipping Routes Beneft
PotashCorp
With most global potash traded across
borders, mainly by ocean vessels, timely and
cost-effective distribution systems are key
to supplying customers needs. Sailing times
of 30 days or more are common to some
markets, requiring signifcant upfront
planning between supplier and customer
to ensure the potash arrives in time for key
application seasons.
Producers in the Middle East ICL and APC
have logistical advantages into India, while
Canadian producers beneft from a shorter
sailing distance to China out of Canpotexs
West Coast terminals. PotashCorp, the only
producer shipping from the East Coast of
Canada, at Saint John, New Brunswick, has
a signifcantly shorter route to Brazil than our
competitors do.
Majority of Capacity Is Located
Near the Lower End of Cost Curve
Potash operating costs are largely impacted
by geological conditions such as ore grade
and consistency, operational size, labor costs
and degree of automation. Energy prices are
a relatively small factor for conventional
mines, which on average require less natural
gas per tonne produced than solution mines.
When producing at high operating rates
and in a low energy cost environment the
cash cost of production for most producers is
within a relatively narrow band. Higher-cost
facilities are primarily older, smaller-scale
European and US plants. When energy costs
are high, solution mines are likely to reside
on the higher end of the cost curve.
Additionally, limited scalability of solution
mines compared to conventional mines
is an important consideration in capital
investment decisions.
Comparat|ve Ucean Ire|ght Sa|||ng 0ays
6RXUFH206
Ch|na Ind|a 8rat||
vancouver 1T 30 28
Sa|nt Iohn 35 26 16
Israe| 24 10 23
Iordan 24 10 23
0ermany 3T 22 19
kuss|a 38 23 21
0
25
50
15
100
125
150
115
200
225
S|te Cost
0
20
40
o0
80
100
Curu|at|.e Capac|t,
2QVCUJ+PFWUVT[5KVG%QUV2TQHKNG
u'S/!crre C.r.|o||.e Cooc||, - le|cer|
'||e cc| o|e co|c.|o|eJ |oeJ cr |cJ.c||cr cc| o| |ec||eJ cooc||,.
'c.|ce. C8u, lc|o|Cc|
S|te Cost
Curu|at|.e Capac|t,
Nutrients
34 Nutrients
Prices Are Strong for Many
Potash-Intensive Crops
Potash is consumed globally by a wide range
of crops. Grains and oilseeds account for just
over half of total consumption and most of
the remainder is consumed by crops such as
sugar, cotton, coffee, fruits and vegetables.
This market diversity means that demand for
potash is not reliant on the economics of
only a few crops.
The current strength in prices for a broad
range of crops grown around the world is
supporting strong demand for potash in
most major markets.
Lower Freight Rates Have
Enhanced Potash Netbacks
Ocean freight rates declined sharply in late
2008 as commodity trade dropped during
the global economic downturn. A signifcant
increase in new ship builds in the past few
years has kept rates relatively low despite a
recovery in global shipping demand.
With more than 90 percent of Canpotexs
sales made on a delivered basis (meaning the
shipper pays the freight), lower freight rates
have the potential to positively affect our
realized prices.
0 30 o0 90 120 150 180
8araras
w|eat
8|ce
!ea
Cocoa
So,bear
la|r 0||
Cottor
Corr
Suar
Coee
8ubber
0t|er
Suar 8 Cottor
lru|ts 8 veetab|es
0||seeds
ura|rs
wor|d Crop Pr|ces and Potash 0se
le|cer|oe lrc|eoe Ccro|eJ |c 0\eo| /.e|oe
'c.|ce. wc||J 8or|, ll/
wor|d Crop Pr|ces (lu|, 2011} wor|d Potash 0se by Crop
ura|rs
0||seeds
36%
1T%
22%
14%
11%
lru|ts 8
veetab|es
Suar 8
Cottor
0t|er Crops
0
10
20
30
40
50
o0
10
80
11 10 09 08 01 0o 11 10 09 08 01 0o 11 10 09 08 01 0o 11 10 09 08 01 0o
lenny, nudge "11" lo clicks lo
lhe righl lo align number under bar.
1EGCP(TGKIJV4CVGU8CPEQWXGTVQ/CLQT2QVCUJ/CTMGVU
u'S/!crre
%JKPC +PFKC /CNC[UKC $TC\KN
\eo||cJo|e o c l.|, 20
'c.|ce. 0|'
Potash
35
Rising Demand and Limited
Domestic Production Capability
in Latin America
Latin American farmers are among the
worlds most market-oriented growers.
With near-record prices for a wide range of
crops grown in this region, potash sales are
expected to reach record levels in 2011. Brazil
is the largest market, accounting for more
than 75 percent of the regions total demand.
With only two small operations, the region
imports more than 80 percent of its potash
requirements. Shipments from Canada and
the former Soviet Union account for almost
60 percent of the total.
Domestic Producers Supply
Majority of North American
Demand
North America is a relatively mature market
for granular potash. Demand recovered to
near historical highs in 2010, and we expect
it to remain strong throughout 2011.
Domestic producers supply approximately
90 percent of the North American market,
with Canadian suppliers accounting for the
majority of this supply. Offshore imports into
the US Gulf and East Coast, primarily from
Russia and Israel, provide the remainder.
0
2
4
o
8
10
12
lrport 8are
0s|ore lrports
uorest|c lroducer S||prerts
2011l 2010 2005 2000 1995
0t|er
uerrar,
lsrae|
lSu
Carada
C|||e
8ra/||
Potash Market Prof||e - Lat|n Amer|ca
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2010 Sh|pment Prof||e
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lrport 8are
0s|ore lrports
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Carada
8ra/||
C|||e
2010 S||prerts - 8.o r||||or torres
30%
29%
8%
5%
T%
8%
13%
uerrar,
lsrae|
lSu
0t|er
0
2
4
o
8
10
12
14
S||prert 8are
0s|ore lrports
2011l 2010 2005 2000 1995
0t|er
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Carada
Potash Market Prof||e - North Amer|ca
6RXUFH)HUWHFRQ,31,3RWDVK&RUS
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S||prert 8are
0s|ore lrports
Carada
2010 S||prerts - 10.2 r||||or torres
T8%
9%
2%
11%
uS
0t|er
lSu
Nutrients
36 Nutrients
India Relies on Potash Imports to
Meet Rising Demand
Indias potash consumption increased by
nearly 10 percent annually over the 10-year
period ending in 2010, but farmers still
apply potash fertilizer at rates well below
scientifcally recommended levels. Given the
delay in settling new contracts and limited
product availability in the second half of
2011, we expect a signifcant decline in
Indias imports this year. With its pressing
need to increase crop productivity and
restock depleted inventories, we expect
strong demand in 2012.
India relies entirely on imports to meet its
potash demand. Typically, former Soviet
Union producers have supplied more than
40 percent of volumes with the remainder
split among suppliers from Canada, Israel,
Jordan and Germany.
Chinas Rising Food Production
Needs Drive Long-Term Growth
China is the largest consumer of potash
fertilizer, accounting for approximately
20 percent of global use. With reduced
domestic inventories and an anticipated
return to pre-downturn consumption,
imports are projected to rise in 2011.
We believe Chinas domestic production
capability is limited and it will have to
import approximately three-quarters of its
annual requirements over the long term.
Typically, producers in the former Soviet
Union supply approximately one-third
of the shipments through a combination
of rail and ocean deliveries.
0
1
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0t|er
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lrport 8are
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Carada
32%
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8%
10%
3%
2%
3%
uerrar,
lsrae|
lSu
lordar
0t|er
Potash
37
Tightening Global Supply/Demand
Fundamentals
Higher prices for potash refect the strength
in global agricultural fundamentals and the
increasing pressure on world potash supply.
Since the third quarter of 2010, spot prices
in North America and Brazil have risen by
approximately 50 percent. While these are
signifcant increases driven by strong demand,
we believe realized prices do not yet refect
the levels necessary to support long-term
investment in greenfeld potash capacity.
Demand Rising for Other Asia
Regions Potash-Intensive Crops
Large populations and expanding economies
in many Asian countries have driven a rapid
increase in crop production. As a result,
potash consumption in Asian countries
(excluding China and India) has grown by
nearly 80 percent over the past two decades.
With strong prices for potash-intensive
crops such as oil palm, sugar, fruits and
vegetables, demand in 2011 is projected at
record levels.
With no domestic potash production, the
regions rising demand is met by increasing
imports. Typically, Canada has been the
largest supplier of potash to this region,
accounting for more than 40 percent of
total imports.
300
350
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0t|er
Nutrients
38 Nutrients
New Supply Required to Meet
Growing Demand
Demand for potash rose by more than
3 percent annually through the 15 years
prior to the global economic downturn
the highest rate among the primary
nutrients. We believe supportive agriculture
fundamentals and the need to catch up on
years of under-applying potash in developing
countries will drive strong growth in
consumption over the medium term.
With the long lead time required for
developing new supply, we believe the
industry will be challenged to meet
the worlds rising potash demand in the
years ahead. This supports the need for
long-term investment in operational
capability to meet growing demand.
Excluding PotashCorp, Limited
New Operational Capability
Expected in Medium Term
While some observers believe that new
supply could outpace the global need in the
coming years, what is often overlooked is
the challenge of operating mines around the
world at full operational capability. In 2011,
reported geological, logistical and operational
issues constrained the industrys ability to
meet underlying demand, highlighting the
need for new capacity.
The long time horizon on developing new
potash capability means we have a good
view of the global supply picture for the next
several years. Between 2011 and 2015, we
expect approximately 10 million tonnes of
brownfeld operational capability will be
added at existing facilities, with PotashCorp
representing the majority of this.
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lrojects
Potash
39
Rock Reserves Are Geographically
Concentrated
The basis for success in the phosphate
business is access to lower-cost phosphate
rock, a resource that is geographically
concentrated. China, the US and Morocco
together account for approximately two-
thirds of world rock production and Morocco
alone typically supplies more than one-third
of global exports.
Approximately 30 percent of global
phosphate producers are non-integrated,
relying on imports or domestic purchases
for their rock supply. India has limited
indigenous supply of phosphate rock and
is the worlds largest importer, accounting
for about 30 percent of global trade.
North American producers generally have
integrated rock supplies, with imports
accounting for less than 10 percent of
total domestic consumption.
Broad Range of Phosphate
Products
Phosphate rock is mined from underground
ore deposits and reacted with sulfuric acid to
produce phosphoric acid, which is a feedstock
for a wide variety of phosphate products.
Phosphoric acid can be evaporated to
produce merchant-grade phosphoric acid
(MGA), a product that can then be converted
into liquid fertilizer. It can also be combined
with ammonia and granulated to produce the
solid fertilizers DAP and MAP or evaporated
to produce superphosphoric acid (SPA), a
form of liquid fertilizer.
To produce animal feed products, phosphoric
acid can be combined with limestone or
phosphate rock, or it can be purifed by
solvent extraction to make industrial-grade
phosphoric acids.
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Nutrients
Phosphate
40 Nutrients
Morocco Is the Largest Phosphate
Exporter
With access to large, high-quality reserves,
Morocco is the largest exporter of phosphate
rock and phosphoric acid. Offce Chrifen
des Phosphates (OCP) has announced plans
to increase its capability to produce and
export fertilizer products such as DAP and
MAP. Industry consultants forecast that this
increased processing capability could result
in reduced exports of phosphate rock
and phosphoric acid, tightening supply of
these products for non-integrated
phosphate producers.
Solid phosphate fertilizer exports are more
evenly distributed between suppliers in the
US, China, Russia and Morocco. Chinas share
is expected to decline sharply in 2011 as its
government attempts to ensure adequate
supply for the domestic market.
PotashCorp Is the Worlds Third
Largest Producer
The top 10 global phosphoric acid producers
account for approximately 45 percent of total
capacity. These are primarily integrated
producers located near the large phosphate
rock basins in North Africa, North America,
China and Russia.
PotashCorp is the third largest producer of
phosphoric acid with almost 2.4 million
tonnes of capacity. We use this acid to
produce a wide range of products for
fertilizer, feed and industrial purposes.
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Phosphate
41
Limited New Capacity Expected
Until 2013
Most new export-oriented phosphate capacity
through 2015 is expected to be associated
with projects in Saudi Arabia and Morocco.
Maaden in Saudi Arabia started commercial
production of DAP in June 2011 and is
expected to produce 300,000-400,000
tonnes this year. We expect it will be fully
ramped-up to its stated capacity of
approximately 3 million tonnes of DAP by
2013. The majority of capacity additions in
Morocco are forecast to be completed
between 2013 and 2015.
As new export supply comes online, some
high-cost capacity typically that of
producers without access to lower-cost
rock may be displaced.
Fertilizer Accounts for Majority
of Global Phosphate Use
Fertilizer accounts for approximately
90 percent of global phosphoric acid use.
Solid fertilizers DAP and MAP are the
most common phosphate products used
by farmers.
The increasing demand for phosphate
fertilizers has driven phosphoric acid
consumption up by more than 3 percent
annually over the past decade. China and
India have been the largest growth markets
due to their rising domestic requirements
for food production. We expect strong
agriculture markets will support signifcant
growth in phosphate demand over the
coming years.
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Nutrients
42 Nutrients
Signifcant Advantage for
Integrated Producers
Prices for phosphate rock, sulfur and
ammonia, the primary inputs for the
production of solid phosphate fertilizers,
have increased signifcantly over the past
fve years. Rock prices have more than
tripled since 2005, which has resulted in
higher production costs for the approximately
30 percent of global producers that rely
on purchased rock. Higher prices for
ammonia and sulfur have further elevated
production costs.
The price of solid phosphates has historically
followed the costs of non-integrated producers
closely. Their higher costs provide a signifcant
margin opportunity for producers with their
own supply of rock.
Expect Tight Market in the
Short Term
Given strong demand, delayed expansion
projects and announced plant closures, we
expect tight phosphate markets for the near
term. Operating rates in 2012 are projected
at historically high levels.
Beyond 2012, rates are expected to decline
slightly as Maaden ramps up to full capacity
and new supply in Morocco is brought on
stream. However, we believe strong demand
will offset the majority of this new supply,
resulting in a relatively balanced market.
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Phosphate
43
Increase in Imports to Meet Rising
Consumption in India
India primarily produces solid phosphate
fertilizer with imported raw materials: rock,
phosphoric acid, ammonia and sulfur. With
increasing demand and limited domestic
production capability, its imports of DAP
have nearly tripled since 2007. It now
accounts for almost 40 percent of global
DAP and MAP trade and has been a major
driver of export growth over the past
fve years.
As the government works to ensure that
rising domestic demand for food is met,
India is expected to continue to increase
its imports of phosphate products.
Strong Demand and Reduced
Supply Capability Have Tightened
Inventories
For more than a decade, US phosphate
exports trended lower as China moved from
a major import position to become a net
exporter of phosphate. This resulted in an
extended period of excess supply in the
industry and forced the closure of higher-
cost, ineffcient US capacity.
Improved demand, tight sulfur supplies
and the closure of a non-integrated US
production facility have tested the industrys
supply capabilities over the past year. We
expect tight supply conditions to continue in
the near term, given the prospects for strong
demand from markets around the world.
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Nutrients
44
Saudi Arabia and Morocco
Increasing Export Capability
New export supply from Saudi Arabia and
Morocco is expected to capture most of the
growth in global demand for phosphate
imports over the medium term. The closure
of a domestic production facility in 2011 is
expected to reduce the amount of US
phosphate available for export.
Exports from China are expected to decline
from the record levels of 2010 due to the
implementation of tighter export tax policies
and the potential closure of small-scale,
ineffcient facilities.
Demand Met by Higher Imports
and Domestic Production
Brazil is the second largest phosphate
importing country in the world, after India.
It imports a variety of solid fertilizer products:
MAP, DAP, TSP and SSP.
Phosphate consumption in Brazil is expected
to reach record levels in 2011, driven by
agronomic need and strong prices for a wide
range of crops produced there. Domestic
production capability has increased in recent
years so import volumes have not returned
to the record levels of the past. We expect
future demand growth will be met by further
domestic capacity expansions as well as
increased imports.
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Nutrients
Phosphate
45
PotashCorp Is the Third Largest
Producer
Nitrogen is a highly fragmented and
regionalized business because of the
extensive availability of natural gas globally
and high transportation costs. The 10 largest
nitrogen producers account for approximately
19 percent of global ammonia capacity.
PotashCorp is the third largest producer
by ammonia capacity, with a large-scale
operation in Trinidad and two producing
facilities in the United States. In 2011, we
announced plans to resume ammonia
production at our Geismar, Louisiana plant
in the third quarter of 2012, which we expect
will increase our annual ammonia capacity
by almost 500,000 tonnes.
Access to Lower-Cost Hydrogen
Source Is Key to Nitrogen Success
Ammonia is synthesized from hydrogen
sources (primarily natural gas or coal),
steam and air. It is a concentrated source
of nitrogen and the basic feedstock for all
upgraded nitrogen products. It is also used
to produce various industrial products and
for direct-application fertilizer.
Urea is the most commonly used nitrogen
fertilizer product and is also the feedstock
for industrial products such as plastics,
resins and adhesives. Liquid forms of urea
and ammonium nitrate are combined into
UAN solution, which is used in agriculture.
Ammonium nitrate is made by combining
ammonia with nitric acid and has both
industrial and agricultural uses
(PotashCorp does not sell agriculture-
grade ammonium nitrate).
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AN
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0k
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0.35 t/t
32.5 HH8tu/tor
0.29 t/t 0.22 t/t 0.58 t/t
0.18 t/t 0.80
t/t
0.45 t/t 1.01 t/t 1.01 t/t
Nutrients
Nitrogen
46
Expect North America to Head
Development of Shale Gas
The primary US shale gas basins currently in
production are located in the Appalachian
Basin, Texas, Louisiana and Arkansas. Despite
some environmental concerns that have
delayed development in certain states, there
is signifcant potential for future production
growth in North America.
Shale gas production is currently limited in
other regions of the world although large
deposits exist in the former Soviet Union,
Argentina, South Africa, Europe and China.
While these provide long-term potential,
we expect that the majority of shale gas
production over the next fve years will
occur in North America.
Supply Rising Due to Development
of Shale Gas Deposits
Shale gas production, which uses horizontal
drilling and hydrofracturing technology to
extract gas trapped in shale formations, has
contributed to the resurgence in US natural
gas production. Supply from shale gas
deposits has increased more than twelve-fold
over the past 10 years.
The US Energy Information Administration
projects that shale gas production will rise by
almost 4 percent annually over the next two
decades, more than offsetting potential
declines in conventional production. We
expect this new source of supply could
encourage increased industrial usage of natural
gas as consumers look for economical and
relatively low-carbon energy sources.
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Nitrogen
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47
Ammonia Is Consumed Mainly in
Its Home Market
The physical properties of ammonia require
high-pressure containers, making it costly
and diffcult to transport. As a result, most
ammonia is consumed close to where it
is produced.
China is the largest market and consumes
almost one-third of the worlds ammonia.
Although it is the largest global producer,
it uses virtually all that it produces and is not
a signifcant factor in world trade.
The majority of new ammonia capacity
is expected to come on line in China for
internal consumption and in the Middle East
and North Africa primarily for export of
nitrogen-based products.
US Likely to Maintain Its Favorable
Gas Price Position
The development of shale gas has dramatically
improved the competitive position of US
nitrogen producers compared to suppliers in
Ukraine and Western Europe. Industry
consultants expect this favorable gas pricing
environment will continue for at least the
next three to fve years.
In Europe, major industrial buyers continue
to increase their purchases of gas from the
spot market but still meet a signifcant portion
of their needs through contracts linked to
the price of oil. Gas prices in Ukraine are
expected to be linked to European prices
and remain above those paid in the US.
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Nutrients
48
Relatively Balanced Ammonia
Market Outside of China
With limited global capacity additions in
recent years and strong demand, the
nitrogen market has tightened. Beginning in
2012, a number of new nitrogen plants are
expected to come online, adding to world
supply. However, with above-average growth
in demand anticipated between 2011 and
2015, we expect nitrogen markets to remain
relatively balanced over this period.
Ammonia capacity additions in China
are expected to meet rising domestic
demand and enable the closure of small,
ineffcient facilities.
Strong Agriculture Fundamentals
Drive Consumption Growth
Global ammonia demand is forecast to grow
at an average annual rate of approximately
3 percent over the next fve years, well
above the historical growth rate of closer to
2 percent. Strong agricultural fundamentals
are expected to drive this growth as fertilizer
uses account for approximately 80 percent
of global ammonia demand.
Consumption for industrial purposes
is expected to continue its recovery
following the sharp decline during the
economic downturn.
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Nutrients
Nitrogen
49
Trinidad Is the Major Offshore
Supplier to the US Market
The improved cost position for US nitrogen
producers has resulted in a stabilization of
domestic production. While we do not
expect greenfeld nitrogen plants will be
built in the US, domestic ammonia supply
could increase in the medium term.
Resumption of ammonia production
at our Geismar, Louisiana plant and
potential debottlenecking projects at
other facilities are the most likely sources
of incremental supply.
Increased domestic production could reduce
the amount of supply needed from higher-
cost offshore producers, primarily from the
former Soviet Union. Trinidad is expected to
remain the largest exporter of ammonia to
the US, accounting for more than 60 percent
of its total imports.
Expect Majority of Import Growth
From Asian Markets
The US is the largest ammonia importer
and typically accounts for approximately
35-40 percent of world trade. Europe, a
higher-cost producer, accounts for roughly
25 percent of trade. The majority of growth
in imports is expected in Asian countries,
for industrial uses and for the production of
fertilizer products.
The former Soviet Union, Latin America, the
Middle East and North Africa are the primary
ammonia-exporting regions due to their
lower-cost natural gas and limited domestic
consumption. Trinidad, the largest exporting
country, accounts for almost 25 percent of
global trade.
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Nutrients
50
Most Growth in Urea Exports
Expected in Asian Countries
The US and India are the major importing
countries, accounting for approximately
one-third of global trade. Countries in Asia,
Latin America and Europe are expected to
account for the majority of demand growth
over the coming years.
China is the worlds largest urea exporter,
although annual volumes have fuctuated due
to changes in government export policies.
We anticipate exports in 2011 will be kept
well below the 2010 record due to rising
energy costs, along with the governments
continuing focus on adequacy of domestic
supply and environmental concerns
associated with older plants.
New export supply will be added in the
Middle East and North America to meet
rising demand.
Majority of New Urea Export
Supply Located in Middle East and
North Africa
Solid urea can be handled easily and at a
signifcantly lower cost than ammonia,
and therefore is shipped more readily. More
than 25 percent of global urea production
is traded.
Asia is by far the largest producing region
and China alone accounts for approximately
35 percent of the global market. Its new
capacity will be developed to meet rising
domestic requirements and to replace older,
ineffcient nitrogen plants.
The majority of new export-oriented urea
capacity is expected in the Middle East and
North Africa, due to the availability of
lower-cost natural gas.
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Nutrients
Nitrogen
51
Potash 52
Phosphate 53
Nitrogen 54
General 55
Planting Calendar 57
Nutrient Uptake /
Removal by Crop 58
Glossary 59
Resources
Resources
52 Resources
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PotashCorp Product|on Cost Prof||e - Potash
2010 Product|on Cost Compos|t|on
6RXUFH3RWDVK&RUS
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Potash
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Canpotex Sales Profle by Region
Percentage of Annual Sales Volumes
China India Other Latin Other
Asian America Countries
Countries*
2008 13 16 39 25 7
2009 6 32 43 13 6
2010 14 14 41 25 6
* All Asian countries except China and India
Source: Canpotex, PotashCorp
Conversion Factors:
To convert: To: Multiply by:
K K
2
O 1.2046
K
2
O K 0.8302
KCl Product K
2
O 0.6100
K
2
O KCl Product 1.6393
53 Resources
Phosphate
Production Factors:
To produce 1 short ton of: Requires:
Sulfuric Acid 0.33 tons sulfur
(100% H
2
SO
4
)
Phosphoric Acid 2.8 tons sulfuric acid
(100% P
2
O
5
) 3.5-4.0 tons phosphate rock
Diammonium Phosphate in raw material form:
(46% P
2
O
5
0.44 tons sulfur
0.23 tons ammonia
Monoammonium Phosphate in raw material form:
(52% P
2
O
5
0.53 tons sulfur
0.145 tons ammonia
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3PDL
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ue|srar
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5
lrdustr|a|
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Conversion Factors:
P P
2
O
5
2.291
P
2
O
5
P 0.4364
BPL P
2
O
5
0.4577
P
2
O
5
BPL 2.1852
54
Nitrogen
Production Factors:
To produce 1 short ton of: Requires:
Ammonia 32.5 MMBtu natural gas
Urea 24.0 MMBtu natural gas
Ammonium Nitrate 17.2 MMBtu natural gas
UAN Solution (32% N) 13.7 MMBtu natural gas
Urea Solution 0.58 tons ammonia
0.78 tons CO
2
Urea Prills (46% N) 1.01 tons urea solution
Nitric Acid (22% N) 0.29 tons ammonia
Ammonium Nitrate Solution 0.80 tons nitric acid
0.22 tons ammonia
UAN Solutions (32% N) 0.45 tons ammonium
nitrate solution
0.35 tons urea solution
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/BUVSBM(BT
PotashCorp Product|on Cost Prof||e - Ammon|a
6RXUFH3RWDVK&RUS
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20%
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L|ra
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!r|r|dad
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Resources
0.1
0.0
0.1
0.2
0.3
0.4
0.5
0.o
0.1
0.8
Nort| Arer|ca
2010 2008 200o 2004 2002 2000 1998
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6RXUFH3RWDVK&RUS
0
1
2
3
4
5
o
1
So|ut|ors/N|tr|c Ac|d/Arror|ur N|trate
urea
Arror|a
2010 2008 200o 2004 2002 2000 1998
2QVCUJ%QTR0KVTQIGP5CNGU8QNWOGU
0LOOLRQ7RQQHV
6RXUFH3RWDVK&RUS
urea So|ut|ors/N|tr|c Ac|d/Arror|ur N|trate Arror|a
Conversion Factors:
N NH
3
1.2159
NH
3
N 0.8225
55
General
Fertilizer Conversion Factors:
Tons (long) pounds 2240.0
Tons (long) metric tonnes 1.0160
Tons (long) short tons 1.2000
Tonnes (metric) pounds 2204.6
Tonnes (metric) long tons 0.9842
Tonnes (metric) short tons 1.1023
Tons (short) pounds 2000.0
Tons (short) long tons 0.8929
Tons (short) metric tonnes 0.9072
General Conversion Factors:
acres ha 0.4048
ton/acre tonne/ha 2.2411
lb/acre kg/ha 1.1228
lb kg 0.4545
Crop Weight Conversion Factors:
Corn (US) 56 lb/bu 39.368 bu/tonne
Soybean (US) 60 lb/bu 36.744 bu/tonne
Wheat 60 lb/bu 36.744 bu/tonne
Rice Paddy (US) 45 lb/bu 48.991 bu/tonne
Resources
Potash Products K
2
O Content
Potassium Chloride (MOP) 60-63.2%
Potassium Sulfate (SOP) 50-54%
Potassium Nitrate 46.60%
Potassium Magnesium Sulfate 21.90%
Potassium Sodium Nitrate 14%
Phosphate Products P
2
O
5
Content
Phosphate Rock (0.4577 x BPL)
66% BPL 30.20%
68% BPL 31.10%
72% BPL 33.00%
Wet Phosphoric Acid (fltered production acid) 28-48%
Phosphoric Acid (Merchant Grade AcidMGA) 54%
Superphosphoric Acid (SPA) 69-70%
Normal (Single) Superphosphate (SSP) 18-20%
Triple Superphosphate (TSP) 46%
Diammonium Phosphate (DAP) 46%
Monoammonium Phosphate (MAP) 48-53%
Monocalcium Phosphate (MCP) 48.1% P
2
O
5
,
21.0% phosphorus,
17.0% calcium
Dicalcium Phosphate (DCP) 42.4% P
2
O
5
,
18.5% phosphorus,
21.0% calcium
Tricalcium Phosphate (DFP) 41.2% P
2
O
5
,
18.0% phosphorus,
31.8% calcium
Nitrogen Products P
2
O
5
Content N Content
Anhydrous Ammonia 82.20%
Aqua Ammonia 20.5-28%
Ammonium Nitrate 33-34.5%
Ammonium Sulfate 20.5-21%
Ammonium Thiosulphate 12%
Sodium Nitrate 16%
Urea 46%
Urea Ammonium Nitrate Solutions 28-32%
Calcium Ammonium Nitrate (CAN) 27%
Diammonium Phosphate (DAP)
1
46% 18% (16-21%)
Monoammonium Phosphate (MAP)
1
(48-53%) 11% (10-12%)
1
The range in brackets is the variation worldwide. The stated percentage is typical of
US product.
56
Industry Facts
Company Information
0
500
1,000
1,500
2,000
2,500
0pportur|t, Cap|ta|
Susta|r|r Cap|ta|
2015l 2014l 2013l 2012l 2011l
2QVCUJ%QTR%CRKVCN5RGPFKPI(QTGECUV
u'S |||||cr Susta|r|r Cap|ta|
lc|eco| |oeJ cr o|c.eJ |cjec|
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0pportur|t, Cap|ta|
Facility
Standard Capacity*
Expansions/
Debottlenecking
Investment
(CDN$ Billions)
Construction Projects Completed (2005-2010)
Rocanville 0.75 MMT $0.13
Allan 0.40 MMT $0.21
Lanigan 1.50 MMT $0.41
Patience Lake 0.36 MMT $0.11
Cory I 1.20 MMT $0.90
Total 4.21 MMT $1.76
Projects in Progress
New Brunswick** 1.20 MMT $1.66
Cory II 1.00 MMT $0.74
Allan 1.00 MMT $0.55
Rocanville 2.70 MMT $2.80
Total 5.90 MMT $5.75
* Includes, as applicable, both bringing back previously idled capacity and expansions
to capacity and does not necessarily refect current operational capability
** Net capacity increase assuming closure of existing 0.8 MMT mine
Resources
A Comparison View of Our Nutrients
Potash (KCl) Phosphate (P
2
O
5
) Nitrogen (NH
3
)
PotashCorp % of World Capacity
1
20% (#1 in world) 5% (#3 in world) 2% (#3 in world)
# of Producing Countries 12 ~ 40 ~ 60
Time for Greenfeld (including ramp-up) Minimum 7 years
2
3-4 years 3 years
Cost of Greenfeld (excluding infrastructure) CDN $4.1 billion
2
2 million tonnes KCI
US $1.6 billion
3
1 million tonnes P
2
O
5
US $1.6 billion
4
1 million tonnes NH
3
Cost of Greenfeld (including infrastructure)
5
CDN $4.7-$6.3 billion
2 million tonnes KCI
US $2.1-$2.3 billion
1 million tonnes P
2
O
5
US $1.7-$1.9 billion
1 million tonnes NH
3
K P N
1
Based on nameplate capacity, which may exceed operational capability (estimated annual achievable production level)
2
Estimated time and cost for a conventional greenfeld mine in Saskatchewan
3
Phosphate rock mine, sulfuric acid plant, phosphoric acid plant and DAP/MAP granulation plant
4
Ammonia/urea complex
5
Includes rail, utility systems, port facilities and, if applicable, cost of deposit
Source: Fertecon, CRU, AMEC, PotashCorp
PotashCorp Expansion Projects
57
Planting Calendar
Customers in different parts of the world require potash at various times of the year to correspond with their planting seasons. These
calendars lay out typical patterns of potash purchases and the planting and harvesting for selected crops. Due to the range of planting/
harvesting times from the north to the south, the calendars represent a typical location and may not be representative of the entire country.
Brazil Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
% K Used
by Crop
20% 25% 34% 21%
Potash Purchases
% by Quarter*
Soybeans 34% Harvest Plant
Sugar Cane 20% Plant / Harvest
Corn 19% Harvest Plant
Fruits & Vegetables 5% Multiple potash applications throughout the year
US Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
% K Used
by Crop
26% 30% 22% 22%
India Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
% K Used
by Crop
24% 15% 25% 36%
Potash Purchases
% by Quarter*
Kharif Rice [90%] Harvest Plant Harvest
Rabi Rice [10%] Plant / Harvest Plant
Winter Wheat 8% Harvest Plant
34%
China Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
% K Used
by Crop
28% 19% 25% 28%
Potash Purchases
% by Quarter*
Rice
Single Crop [50%] Plant / Harvest
Early Double-crop [25%] Plant / Harvest
Late Double-crop [25%] Plant / Harvest
Corn [North] Plant Harvest
Corn [South] Plant Harvest
Winter Wheat [70%] Harvest Plant
Spring Wheat [30%] Plant Harvest
* Percentage purchased by quarter based on 2006-2008 purchases
Potash Purchases
% by Quarter*
Corn 46% Plant Harvest
Soybeans 15% Plant Harvest
Winter Wheat [70%] Harvest Plant
Spring Wheat [30%] Plant Harvest
5%
28%
2%
4%
Resources
58
Nutrient Uptake / Removal by Crop
Crop Statistics for Selected Crops
Crop Nutrient Uptake Crop Nutrient Removal
for Selected Crops (lb/acre) for Selected Crops (lb/acre)
Specifed Yield N P
2
O
5
K
2
O N P
2
O
5
K
2
O
Rice 7,000 lb/acre 112 60 148 89 47 25
Wheat 45 bu/acre 99 35 69 68 27 15
Corn 160 bu/acre 213 90 213 144 61 43
Grain Sorghum 8,000 lb/acre 250 90 200 94 56 38
Soybeans 50 bu/acre 245 54 115 190 42 65
Rapeseed 35 bu/acre 105 46 83 66 32 16
Sugar Cane 50 tons/acre 210 100 330 100 63 175
Cotton 1,500 lb/acre 180 63 126 100 44 59
Flue-Cured Tobacco 3,000 lb/acre 126 26 257 84 15 156
Sweet Potatoes 300 cwt/acre 156 69 313 156 69 300
Grapes 12 tons/acre 102 35 156 100 35 156
Nutrient Uptake: the total nutrients absorbed by the growing crop.
Nutrient Removal: the quantity of nutrients removed in the harvested portion of the crop.
cwt = hundred weight
Source: IPNI
Resources
World Fertilizer Use by Crop
N P K
Wheat 17% 16% 6%
Rice 16% 12% 13%
Corn 17% 13% 14%
Other Coarse Grains 5% 5% 3%
Oilseeds 6% 13% 17%
Cotton 4% 4% 2%
Sugar Crops 3% 4% 9%
Fruits & Vegetables 16% 18% 22%
All Other Crops 16% 15% 14%
Source: IFA
59
Glossary
General
Mixed fertilizers contain more than one nutrient. Fertilizer graded as
5-20-20 contains 5% nitrogen (N), 20% phosphorus (P
2
O
5
) and 20%
potash (K
2
O) by weight. The nutrient breakdown is always stated in the
same order, and is referred to in the industry as N-P-K.
Liquid fertilizers come in two types: solution, in which all the plant
nutrients are dissolved in solution; and suspension, a saturated solution in
which some plant nutrients are suspended (by gelling clay).
Metric tonnes equal 2,204.6 pounds or 1,000 kilograms. Most offshore
sales are made in metric tonnes and US dollars. To convert to short tons,
multiply by 1.1023.
North American and Export or Offshore Markets The North American
market includes Canada and the United States, while the export or
offshore market is the rest of the world.
Product tonne is a standard metric measure of the weights of all types
of potash, phosphate and nitrogen products.
Short tons are the equivalent of 2,000 pounds. They are rarely used in
Canada since metrication but are used in the United States. The
corporations US price lists are in US dollars per short ton. To convert to
metric tonnes, multiply by 0.9072.
FSU is the former Soviet Union.
Grain includes wheat, rice and coarse grains, unless otherwise noted.
E is for Estimated.
F is for Forecast.
Potash
Potassium (K) is the seventh most common element in the earths crust.
Economically recoverable deposits are usually found combined with
chlorine in the chemical compound potassium chloride, commonly
referred to as potash.
Potash (KCl) Potash fertilizer is muriate of potash (KCl, potassium
chloride). Potassium also combines with other materials in specialty
fertilizers such as potassium sulfate (K
2
SO
4
), potassium magnesium sulfate
(K
2
Mg
2
(SO
4
)
3
) or potassium nitrate (KNO
3
).
K
2
O is potassium oxide, a term used in the fertilizer industry to defne
potassium content. To convert KCl product tonnes to K
2
O, multiply by
0.61.
K
2
O tonnes are units of measurement of the nutrient value of potassium-
containing fertilizers produced by different facilities. PotashCorp potash
product is guaranteed to contain a minimum of 60% K
2
O.
Canpotex Limited is an export company owned by all Saskatchewan
potash producers.
Operational capability is the estimated annual achievable production
level.
PhosPhate
Phosphorus (P) is widely distributed in nature in combination with other
elements. Economically recoverable deposits most commonly contain
phosphate rock (apatite), which is used in production of phosphate
fertilizers and phosphate chemicals.
DAP, diammonium phosphate, is the major solid phosphate fertilizer. Its
excellent handling properties and N-P-K composition 18-46-0 make it
well suited to both large- and small-scale agriculture.
MAP, monoammonium phosphate, is a solid fertilizer with typical N-P-K
composition 13-52-0.
TSP, triple superphosphate, is a solid fertilizer produced from phosphate
rock and phosphoric acid, which has N-P-K composition 0-46-0.
MGA, merchant grade phosphoric acid available in amber or green, has
N-P-K composition 0-54-0. It is primarily used to produce DAP.
Superphosphoric acid (SPA), with N-P-K composition 0-70-0, is used to
manufacture liquid fertilizers. PCS Phosphates LoMag is superphosphoric
acid with its magnesium content substantially reduced through fltration.
P
2
O
5
, phosphoric pentoxide, is a term used to express content of
phosphorus. To convert P to P
2
O
5
, multiply by 2.2915.
P
2
O
5
tonnes are the units of measurement of phosphorus-containing
fertilizers, which vary from product to product. DAP is typically 46% P
2
O
5
.
Animal and poultry feed supplements (Dical, Monocal, DFP) are an
important source of phosphate nutrients. They are solid products with
differing calcium and phosphate contents. These products are sold on
the basis of their phosphorus content.
nitroGen
Nitrogen (N) is a gas which makes up 78 percent of the atmosphere. It is
an essential nutrient for plant growth. Some plants, including legumes
such as soybeans, can fx nitrogen from the air, but most take it from the
soil. It must be applied to soil for each crop because its nutrient value is
consumed during each growing season.
Ammonia (NH
3
) is produced primarily from natural gas and air as the frst
step in the production of nitrogen fertilizers. It can also be applied directly
to soils. Anhydrous ammonia (NH
3
) is a gas with N-P-K composition
82-0-0, which is changed under pressure to a liquid, and stored and
transported in this form.
Ammonium nitrate (NH
4
NO
3
), with N-P-K composition 34-0-0, is
water-soluble and used as a solid in industrial applications and as a liquid
in nitrogen solutions. Half its nitrogen is in ammonium form, half in nitrate
form.
Nitric acid (HNO
3
), produced by an ammonia oxidation process, is used
in the production of ammonium nitrate and as an intermediate for
industrial purposes.
Nitrogen solutions (UAN) are produced by blending ammonium nitrate
and urea solutions. Used in manufacturing starter fertilizers and for
direct application on soils, they vary in nitrogen content (28-32%) and
are non-pressure solutions.
Urea (CO(NH
2
)
2
), N-P-K composition 46-0-0, is the most commonly
produced and widely traded nitrogen product. It is used as fertilizer and
for industrial purposes.
Resources
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2011 - Potash Corp Industry Overview - Complete

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2005 2015F 2010

PotashCorp Potash Operational Capability

Nitrogen 2010 Phosphate 2010

Source: Fertecon, IFA, PotashCorp

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