Organizational Profile
Overview
PotashCorp is an integrated producer of fertilizer, industrial and animal feed products. We are the world’s largest fertilizer enterprise by capacity, producing the three primary plant nutrients: potash, phosphate and nitrogen. With approximately 20 percent of global capacity* at our Canadian operations, we are the world’s largest potash producer. We are the third largest global producer of phosphate and nitrogen. Our products serve customers on six continents.
Our head office is in Saskatoon, Saskatchewan. We also have a major corporate office in Northbrook, Illinois and production facilities in Canada, the United States and Trinidad.
For further information about our company’s 2009 performance and strategies, see our 2009 Online Annual Report.
*Based on our nameplate capacity.
Legal Form and Ownership
PotashCorp is a publicly traded Canadian corporation (organized under the Canada Business Corporations Act) with all shares listed and traded on the Toronto and New York stock exchanges (symbol POT).
We had 296,975,550 common shares outstanding at the end of 2009. Institutional shareholders in Canada and the United States are the primary holders.
All monetary amounts in this report are stated in US dollars, unless otherwise noted.
Operations and Investments Map
Business Segments and Operations
PotashCorp has potash operations in Canada, phosphate operations in the United States and nitrogen operations in the United States and Trinidad.
We produce most of the product we sell, and do not use outsourcing as a production strategy.
Potash Operations
Potash (potassium chloride) is the residue of ancient evaporated seas, and PotashCorp mines and refines this potash. Saskatchewan mines are located at depths of approximately 1,000 meters. Potash is processed in above-ground mills.
The refining process separates clays and sodium chloride from the potash and then dries, screens and, if customers want, compacts the product. Potash is primarily used as a fertilizer but can also be applied as a de-icing salt.
In 2009, we produced 3.4 million tonnes of potash, well below the 8.7 million tonnes in 2008. Our 2009 production was our lowest as a publicly traded company, and was due in large part to the global downturn.
Phosphate Operations
Phosphate comes from marine fossil-bearing ore beds. PotashCorp mines the ore and transports it to processing plants.
Phosphate rock is crushed and combined with sulfuric acid to produce phosphoric acid (P2O5), which is used as a feedstock for the solid fertilizers diammonium phosphate (DAP) and monoammonium phosphate (MAP), liquid fertilizers such as merchant-grade phosphoric acid (MGA), superphosphoric acid (SPA), purified acid and other products.
Phosphoric acid can be combined with limestone or phosphate rock to produce animal feed products. It can also be purified by solvent extraction to produce industrial-grade phosphoric acid.
In 2009, we mined 6.7 million tonnes of phosphate rock for internal use, down from 7.1 million tonnes in 2008, and produced 1.5 million tonnes of phosphoric acid (measured as P2O5), down from 1.9 million tonnes the previous year.
Nitrogen Operations
PotashCorp produces nitrogen products used in fertilizers, industrial products and animal feed.
Nitrogen is not mined – it exists in the atmosphere. However, plants cannot absorb nitrogen in its natural state, so it is converted into ammonia or other products. We make ammonia by extracting nitrogen gas from the air and combining it with hydrogen reformed from natural gas.
Ammonia is used to produce upgraded nitrogen products, including urea, nitrogen solutions, ammonium nitrate and nitric acid. Ammonia, urea and nitrogen solutions are sold as fertilizers. Urea is also used in animal feed, and all products except nitrogen solutions are sold for industrial use.
PotashCorp produced 3.1 million tonnes of ammonia in 2009, up from 3.0 million tonnes in 2008. We also produced 1.4 million tonnes of urea solids, 1.0 million tonnes of nitric acid, 0.7 million tonnes of nitrogen solutions and 0.5 million tonnes of ammonium nitrate solids.
Investments
We invest in offshore potash businesses to expand our global reach in the potash business. Our investments include:
- 28 percent of Arab Potash Company (APC) in Jordan, a key supplier of potash to India and Asia;
- 14 percent of Israel Chemicals Ltd. (ICL) in Israel, a supplier of potash and phosphate fertilizer to Europe, Brazil, India, China and Israel;
- 32 percent of Sociedad Quimica y Minera de Chile (SQM) in Chile, a specialty producer of potash, iodine and lithium;
- 22 percent of Sinofert Holdings Limited (Sinofert), the largest distributor and importer of potash and other fertilizers in China.
Suppliers
With our ongoing expansions, services for engineering and construction account for the largest portion of PotashCorp’s annual procurement in 2009. Other significant goods and services purchased include production feedstocks such as natural gas, ammonia and sulfur, rail and ocean freight services, electricity, and materials for maintenance and repair.
Top Suppliers in 2008 and 2009
The total value of goods, materials and services purchased in 2009 was $3.7 billion, down 17 percent from $4.5 billion in 2008. These are provided by more than 650 key suppliers, mainly in the United States, Canada and Trinidad.
Find more discussion on our relationships with suppliers and how we foster long-term relationships with them here.
Customers
In potash, Canpotex Limited (Canpotex), the offshore marketing company owned by the three Saskatchewan producers, handles all sales of Saskatchewan potash to markets outside of the US and Canada.
In phosphate, PhosChem, a US marketing association that includes Mosaic, sells our phosphate fertilizers offshore.
In North America, PotashCorp sells all three fertilizer nutrients to retailers, cooperatives and distributors, who provide storage and application services to farmers.
Governments and private importers in China and India usually buy under contract, while spot sales are more prevalent in other markets. Historically, these contracts with China have been on an annual basis, but in 2010 Canpotex signed its first quarterly contract with this major customer.
Industrial customers for nitrogen products and phosphoric acid, including purified phosphoric acid, are mainly based in North America. We have long-term relationships with industrial customers, and industrial products have historically experienced less seasonality and cyclicality than fertilizer sales.
The main customers for animal feed products are US bulk food producers, and their proximity to our plants is an advantage. Brazil and Mexico are our largest international customers. These products are also typically less seasonal and cyclical than fertilizer sales.
Learn more about how we build long-term relationships with our customers.
Employees
Our physical assets are important, but our employees are the key to our success. We strive to attract and retain talented, motivated and productive employees who are committed to our long-term goals.
Employee Engagement
Employment Statistics and Performance
Underground Success Story (Engineers-in-Training)