* Says to think about further markups after Easter holidays
* Confirms 2011 outlook for marked gain in sales, profit
* Previous price hikes have been fully accepted -unit head
* Shares up 1.5 pct, among top DAX gainers
(Adds shares, analysts' comment)
By Ludwig Burger
MERKERS, Germany, April 15 German potash miner
K+S SDFG.DE will consider more fertiliser price increases in
its main European market with farmers unfazed by a price hike in
K+S said demand from fertiliser wholesalers remained strong,
as the spring fertilising season for European farmers which
accounts for more than half of the company's potash sales, gets
into full swing.
"Our price increases have been realised in full. Confidence
has returned to the business," said the head of the group's
fertiliser unit, Joachim Felker. "Nobody in wholesale trade is
expecting that there won't be (further) price increases."
"After Easter (April 22-25) we will provide a new price
guidance," said Chief Executive Norbert Steiner, adding that the
agriculture sector would be given time to digest the recent
price increase and that any further markups would be moderate.
Last month, K+S raised the price of its standard granular
potash in Europe by 5.4 percent to 353 euros ($508) per tonne,
following a 5.7 percent markup in December. [ID:nWEA7378]
He also confirmed the group's previous outlook for 2011
sales and operating profit to rise significantly from last year.
Shares in K+S climbed 1.5 percent to 53.76 euros at 1239
GMT, among the top gainers on the DAX blue-chip index .GDAXI.
"This fully confirms our view that the latest (price) hike
... announced four weeks ago was not the last one." said Equinet
analyst Michael Schaefer, adding he now expected the next price
rise to be between 15 euros and 20 euros.
The executives' remarks prompted analyst Harald Gruber at
Silvia Quandt Research to reiterate his "bull case" view of K+S.
"The initiative (to lift prices further) is called for as
wholesalers are bullish on their business, obviously registering
firm demand from farmers," Gruber wrote in a note.
Demand for potash was hit hard by the economic downturn as
investors rushed into, and then later abandoned, agricultural
Many farmers had suspended use of potash during the crisis
because the mineral stays in the soil for longer than other
fertiliser types such as nitrogen.
This created pent-up demand with farmers scrambling to boost
their yields after prices for key crops such as wheat, corn and
soy surged to two-and-a-half year highs earlier this year.
But K+S, which acquired a Canadian mining licence by taking
over Potash One in November, will not be able to increase
volumes to tap this trend before 2015, when the Canadian project
is due to come on stream, CEO Steiner said.
The group's output capacity will be limited to about 7
million tonnes of potash products this year because it stopped
mining an unprofitable product type and also because of upgrades
it needs to make at its main German site Werra to reduce salty
(Editing by Mike Nesbit)