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The fallout from the potash "nuclear bomb"
The equivalent of a nuclear bomb's been detonated in the potash industry - that's how Saxo Bank's Head of Commodity Strategy, Ole Hansen, describes the decision by Uralkali to walk away from a cartel that had fixed prices for years.
Ole says their decision has thrown the market right open. There could be a dash for market share, he says and prices are bound to fall dramatically.
Ole likens Uralkali's decision to Saudi Arabia deciding to leave OPEC. He says potash prices could fall by more than a quarter.
Individual potash company shares have fallen sharply since the news broke. Peter Garnry, Saxo's Head of Equity Strategy, has sympathy for miner, BHP Billiton, which has invested heavily in a new potash project. He says it's going to be very difficult to make money on the long side of this trade. But, as with most things, there will eventually be a recovery.
01:27 minutes
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