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Potash Corp's head office in Saskatoon is pictured on November 3, 2010.David Stobbe/Reuters

Shares of Potash Corp. of Saskatchewan Inc. are surging on speculation the company's rivals in Belarus and Russia may once again team up – a development that could potentially mark an end to potash's long swoon.

Prices for the crop nutrient have plunged since the heady days of 2010, when BHP Billiton Ltd., the world's largest miner, attempted to acquire Potash Corp. during the frenzy of the commodity supercycle.

One key factor in the protracted slide was the split-up in 2013 of the marketing alliance between state-owned Belaruskali of Belarus and Uralkali of Russia, which had previously helped to support global prices for potash.

Comments by Belarus President Alexander Lukashenko on Thursday fuelled speculation that the two large fertilizer producers may be open to renewing their partnership. "New Uralkali shareholders are coming to me every month saying, 'Accept us,'" Mr. Lukashenko told Reuters. "We are not against it. Let's unite, on our conditions."

But his comments were played down by several analysts. "We believe Lukashenko was responding generally to a question about the possibility and stated he wouldn't be against 'on our conditions,'" Joel Jackson of Bank of Montreal wrote in a note. "Well, what's new about that? [The alliance] broke up in mid-2013 because they disagreed on 'conditions.'"

Andrew Wong of RBC Dominion Securities said Mr. Lukashenko's comments will boost share prices of potash producers, but cautioned that a reborn alliance might have only a limited impact on the market.

"Potash buyers have been more hardened in negotiations over the past several years and could push back against attempts at industry co-operation," he warned.

The potash industry is wrestling with a persistent glut of its product as new mines and expansions of existing projects flood the market with supply. Bumper farm crops in recent years have added to the industry's woes by driving down prices for many agricultural commodities and reducing the incentive for farmers to invest in fertilizers and boost production.

In response, Potash Corp. closed a brand-new mine in New Brunswick earlier this year and throttled back on production in Saskatchewan.

Other major producers are also taking a cautious approach. K+S AG of Germany is beginning production at its new Legacy mine near Bethune, Sask., this year, but said this week that it will adjust output according to price and demand, rather than necessarily running the new operation at full tilt.

The persistent gap between bountiful supply and restrained demand may not close any time soon.

"Global supply growth will exceed growth in demand in the long term," says a report prepared last year for the International Fertilizer Industry Association. The report, by IFIA directors Patrick Heffer and Michel Prud'homme, warns that the potential global surplus will swell after 2017 as many large new projects begin production.

Potash isn't traded on any public exchange, so observers usually look to the contract between foreign suppliers and Chinese buyers as one key indicator of market conditions. A deal is frequently struck at the start of the year, but this year no agreement has yet been announced.

In one hopeful sign, Belaruskali signed a deal this week with IPL, India's largest potash buyer, according to Mr. Lukashenko. He gave no details about prices or volumes, but Indian buyers usually wait until after the Chinese deal is concluded to agree on a contract, so the pact may signal a thawing in the market.

News of the Indian breakthrough along with speculation about a reborn marketing alliance in Belarus and Russia lit a fire under potash stocks. Potash Corp. shares gained 5.14 per cent, while Mosaic Co. was up 4.7 per cent and K+S advanced 5.9 per cent.