* Says contracts priced in the range of $700/tonne
* Key contracts with India, China still to come
* Potash Corp shares up 3.3 pct
(Adds analyst comments, background; in U.S. dollars unless
TORONTO, July 9 Potash Corp of Saskatchewan
(POT.TO) (POT.N) said on Thursday its export consortium
Canpotex has signed a contract with customers in Korea and
Taiwan covering potash shipments for the second half of 2009.
Potash Corp, the world's largest fertilizer maker, said the
new contract that varied based on the grade of potash, priced
in the range of $700 a tonne on a delivered basis.
Last month, Canpotex signed a contract with Japanese
customers covering shipments for the second half of 2009, which
were priced at similar levels.
The price of potash -- a key crop nutrient -- has remained
stubbornly high even as demand has collapsed, as a small group
of companies, which account for roughly 75 percent of global
potash supply, have drastically cut production in a bid to
Analysts and investors are keenly awaiting the outcome of
contract negotiations with China and India, as global potash
spot market prices are typically pegged above these key
"Due to small volumes, these transactions (with Korea and
Taiwan) are not expected to have a meaningful impact on price
discovery to larger markets such as China and India, as well as
Brazil and Southeast Asia," BMO Capital Markets analyst Edwin
Chee said in a note to clients.
Most analysts now expect these contract prices to decline
this year in light of the collapse in demand. The contracts
with the two Asian giants are likely to close some time in the
next two months.
China is the world's largest potash buyer and it typically
negotiates annual contracts with Belarussian Potash Co (BPC)
and Canpotex, at a substantial discount to spot market prices.
BPC is a 50-50 joint venture between Russia's Uralkali
(URKA.MM) and Belaruskali, while Canpotex is a partnership
between Potash Corp, Mosaic Co (MOS.N) and Agrium Inc (AGU.TO).
These five companies along with K+S SDFG.DE and Russia's
Silvinit SILV.RTS account for about 75 percent of global
Shares of Potash Corp were up 3.3 percent at C$108.85 on
the Toronto Stock Exchange on Thursday afternoon.
(Reporting by Euan Rocha; editing by Rob Wilson)