Fertilizer Companies Surge After Uralkali Mine Develops Sinkhole

Fertilizer companies surged Tuesday amid a report that Uralkali evacuated its Solikamsk-2 mine.

According to Uralkali, “A sinkhole with a diameter of 30-40 metres has been detected to the east of the Solikamsk-2 production site, outside the metropolitan area. To ensure safety in the area of potential soil subsidence, access to the site has been prohibited.

“The Solikamsk-2 minefield is adjacent to the Solikamsk-1 minefield. Together with geologists from leading scientific establishments, the Company continues to closely monitor these minefields and will provide further updates on the situation in due course.”

Amid the news of the Uralkali mine closing, Credit Suisse upgraded CF Industries Holdings CF from Neutral to Outperform and raised its target price from $228 to $315 on the belief that “CF will further improve its industry positioning over the next 2-3 years and generate best-in-class free cash flow versus peers,” according to analyst Christopher S. Parkinson.  The stock closed at $269.69 Tuesday, down 0.12 percent.

Fertilizer companies were largely up Tuesday and in pre-market trading Wednesday, including Potash Corp./Saskatchewan (USA) POT, Mosaic Co MOS, Agrium Inc. (USA) AGU, Intrepid Potash, Inc. IPI and the Market Vectors Agribusiness (ETF) MOO.

Terra Nitrogen Company, L.P. TNH traded down 7.53 percent amid the news as shares fell Tuesday to $122.70.