The pandemic helped drive curtailments in investments in the
commodity sector, supply chains continue to see widespread
disruption, and turmoil in Eastern Europe has further complicated
the outlook for potash supply, with an estimated 30%-40% of the
world’s supply either off the market or in question. As a result,
potash prices are close to record highs. Moreover, crops that
consume high amounts of potash (like corn, soybeans, wheat, and palm
oil) are also trading close to record highs, which is helping drive
strong farmer economics and continued demand for our key products.
As a company with higher fixed costs, lower variable costs, and
lower royalty rates, when fertilizer prices are high and demand
remains steady, the result can be a significant, positive
bottom-line impact – this was a key reason why our first quarter
2022 adjusted EBITDA of $50.2 million was the highest in almost a
decade.