Skip to main content
The Globe and Mail
Support Quality Journalism
The Globe and Mail
First Access to Latest
Investment News
Collection of curated
e-books and guides
Inform your decisions via
Globe Investor Tools
Just$1.99
per week
for first 24 weeks

Enjoy unlimited digital access
Enjoy Unlimited Digital Access
Get full access to globeandmail.com
Just $1.99 per week for the first 24 weeks
Just $1.99 per week for the first 24 weeks
var select={root:".js-sub-pencil",control:".js-sub-pencil-control",open:"o-sub-pencil--open",closed:"o-sub-pencil--closed"},dom={},allowExpand=!0;function pencilInit(o){var e=arguments.length>1&&void 0!==arguments[1]&&arguments[1];select.root=o,dom.root=document.querySelector(select.root),dom.root&&(dom.control=document.querySelector(select.control),dom.control.addEventListener("click",onToggleClicked),setPanelState(e),window.addEventListener("scroll",onWindowScroll),dom.root.removeAttribute("hidden"))}function isPanelOpen(){return dom.root.classList.contains(select.open)}function setPanelState(o){dom.root.classList[o?"add":"remove"](select.open),dom.root.classList[o?"remove":"add"](select.closed),dom.control.setAttribute("aria-expanded",o)}function onToggleClicked(){var l=!isPanelOpen();setPanelState(l)}function onWindowScroll(){window.requestAnimationFrame(function() {var l=isPanelOpen(),n=0===(document.body.scrollTop||document.documentElement.scrollTop);n||l||!allowExpand?n&&l&&(allowExpand=!0,setPanelState(!1)):(allowExpand=!1,setPanelState(!0))});}pencilInit(".js-sub-pencil",!1); // via darwin-bg var slideIndex = 0; carousel(); function carousel() { var i; var x = document.getElementsByClassName("subs_valueprop"); for (i = 0; i < x.length; i++) { x[i].style.display = "none"; } slideIndex++; if (slideIndex> x.length) { slideIndex = 1; } x[slideIndex - 1].style.display = "block"; setTimeout(carousel, 2500); }

Potash Corp. fell 7.8 percent to $14.84 in New York, the largest decline since July 2013.

Reuters/David Stobbe

Potash Corp. of Saskatchewan Inc., the largest supplier of its namesake fertilizer in North America, fell the most in more than two years after analysts at JPMorgan Chase & Co. said lower nutrient prices probably will prompt management to cut payments to shareholders.

Potash Corp. fell 7.8 percent to $14.84 in New York, the largest decline since July 2013.

The company last week announced an indefinite suspension of operations at its new mine at Picadilly in New Brunswick, Canada, to help reduce a global oversupply that has seen potash prices slump. Additionally, prices are falling for nitrogen- based fertilizers such as urea, something the company also produces. That increases the probability Potash Corp. will reduce its annual dividend to $1 from $1.52 currently, JPMorgan analysts led by Jeffrey Zekauskas said in a note Monday.

Story continues below advertisement

"Our base case is that Potash Corp. will reduce it because the dividend was set during a period of cyclical strength and a higher level of earnings and industry structure conditions that does not resemble today's business landscape," Zekauskas said. "The dividend yield would move from almost 10 percent to 6 percent under our assumptions."

He also cut his rating on Potash Corp. shares to neutral from overweight, the equivalent of buy.

A Potash spokesman didn't return a call seeking comment. Chief Executive Officer Jochen Tilk told investors at a conference on Jan. 21 that the company's board will discuss the dividend when it meets this week. Potash Corp. reports fourth- quarter earnings on Jan. 28.

Jonas Oxgaard, an analyst at Sanford C. Bernstein & Co. who recommends buying the shares, also expects the dividend will be reduced, he said in a note Monday.

"The fear of Potash Corp. going into financial distress and having bigger problems than paying dividends likely outweighs any reward the company is getting from the dividend at this stage," Oxgaard said.

Report an error
Tickers mentioned in this story
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

Comments that violate our community guidelines will be removed.

Read our community guidelines here

Discussion loading ...

To view this site properly, enable cookies in your browser. Read our privacy policy to learn more.
How to enable cookies