Saskatchewan's Economic Outlook

[thefourthtower]

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[Ruckus]

Originally Posted by Nathan

It will still take years to threaten the cartel though... PotashOne's earliest production projection is 2015, and the volume won't be near that of the cartel... and Vale as a new entrant will take a while to get up and running too... BHP's mine will take a long time to develop as well (if they follow through).

So the cartel's position is still solid into the future.. plus they are increasing production with new projects as some of the new entrants emerge. Unless they dismantle it themselves, it will take a while to overthrow it.

It may happen within the next couple years. I really thought publicly held Agrium would be acquired before privately held Mosaic. I don't fully understand Cargill's decision to sell.

They're spinning it off through a complicated process. I don't have the vocabulary to explain it, so here's a few articles for context.

Saskatchewan must have role in Mosaic deal: Wall
Paul Waldie
From Thursday's Globe and Mail
Published Wednesday, Jan. 19, 2011 7:01PM EST
Last updated Wednesday, Jan. 19, 2011 7:04PM EST

Missing pieces to a BHP Mosaic
Stephen Bartholomeusz
Published 3:32 PM, 19 Jan 2011 Last update 10:13 AM, 20 Jan 2011

The potash sector operates in mysterious ways. Could PCS and Agrium protect the cartel by buying up Mosaic shares? Or could protecting the cartel be done other ways? Maybe Saskatchewan should buy shares in Mosaic eh?

[rypinion]

Originally Posted by Ruckus

I don't fully understand Cargill's decision to sell.

I thought I read that it is because the Cargill family wants to diversify their holdings a little.

[Stormer]

Originally Posted by rypinion

I thought I read that it is because the Cargill family wants to diversify their holdings a little.

About half the shares were owned by the original Mr. Cargill's grandaughter who recently died and left almost all her shares to a charitable trust. The trustees naturally don't want all their eggs in one basket. The trust can sell the Mosaic shares but keep the Cargill shares and keep control of Cargill itself within the family. Plus there are tax benefits to doing this.

[Ruckus]

Originally Posted by rypinion

I thought I read that it is because the Cargill family wants to diversify their holdings a little.

But Mosaic is a solid company now, and into the foreseeable future. I get the feeling there is more to this move than simply diversifying their portfolio (is that the correct term? ).

[thefourthtower]

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[Stormer]

Conference Board Outlook released today:

Strong resource prices will make Saskatchewan and Newfoundland and Labrador the fastest growing provincial economies in 2011. Anchored by growth in the potash industry and steady gains in the energy sector, Saskatchewan is poised for a period of prolonged economic prosperity. Saskatchewan’s real growth domestic product is forecast to increase by 3.9 per cent in 2011 and 4.5 per cent in 2012, which would be the fastest growth among the provinces in both years.

http://www.conferenceboard.ca/press/...s_In_2011.aspx

[Stormer]

Financial Times of London story on Sask.:

Please respect FT.com's ts&cs and copyright policy which allow you to: share links; copy content for personal use; & redistribute limited extracts. Email ftsales.support@ft.com to buy additional rights or use this link to reference the article - http://www.ft.com/cms/s/0/dded8740-3...#ixzz1EnlGxtVb

The PotashCorp saga highlighted a dramatic transformation in Saskatchewan’s fortunes. Not long ago, the province evoked images of little more than endless prairie wheat fields. Three sheaves of grain still adorn its flag.
With little urbanisation and few newcomers, Saskatchewan was for decades stuck in a mindset shaped by the Great Depression.
One of Mr Wall’s left-of-centre predecessors was the architect of Canada’s universal healthcare system. To this day, the government controls four pillars of the economy – the phone company, motor vehicle insurer, and gas and power utilities. Saskatchewan is one of few areas in North America that does not observe daylight savings time.
But the commodities boom is reshaping the economy and society at large.
“There are times in the past year when I’ve given my head a shake and asked, is this Saskatchewan?” says Mo Bundon, chief operating officer of Harvard Developments, a real estate group. Harvard is building a 21-storey office tower in Regina, the first such development since the early 1990s

Foreigners are also pouring in to alleviate labour shortages. The Hotel Saskatchewan in Regina estimates that a fifth of its staff are recent immigrants

http://www.ft.com/cms/s/dded8740-3ba...44feabdc0.html

[Stormer]

Press reports say:

Wall will reportedly also hold meetings in London with representatives from Shell, Rolls-Royce, Rio Tinto, Siemens and EDF, Britain’s largest nuclear operator.

Rio Tinto sold out its potash interests in the Regina Project to Vale when they needed cash. Now they are rolling in dough and want to get back in.

Shell is interesting. They don't have much investment in the province now. It is probably about carbon capture and storage:

http://www.shell.com/home/content/me..._14052008.html


The others are all involved in nuclear and power generation.

[brithgob]

Seeing Shell's name reminds me of that old rumour about the company opening a major office in Regina/White City. Whatever happened to that, I wonder.

[Scruff Bucket]

Province gets its first AAA credit rating
LEADER-POST STAFF MAY 25, 2011

For the first time in its 106-year history, Saskatchewan's credit rating is AAA, as Standard & Poor's has upgraded the province's credit rating to the highest level possible.

"The upgrade was warranted because of low and declining debt burden, rebounding economy, strong liquidity and moderate support from the federal government," S & P said in a news release.

"The province's operating-aftercapital results will continue to improve with the strengthening economy and operating revenue growth and that liquidity will remain strong," S & P concluded.

Finance Minister Ken Krawetz noted that Saskatchewan is the only province in the country to have received a credit rating upgrade this year. ...

Read more: http://www.leaderpost.com/business/Province+gets+first+credit+rating/4835911/story.html#ixzz1NOuJSqr3

Also, Star Phoenix's (slightly different) version:

Sask. credit rating best ever
Standard & Poor's upgrades province to AAA rating
Leader-Post May 25, 2011 ...

Read more: http://www.thestarphoenix.com/business/Sask+credit+rating+best+ever/4836129/story.html#ixzz1NOw8q0fl