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Magellan Midstream Partners LP Message Board

abbaman7 55 posts  |  Last Activity: 14 hours ago Member since: Jun 19, 2002
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  • Reply to

    POT still lowest cost producer?

    by long_term_realizer Apr 28, 2016 4:59 PM
    abbaman7 abbaman7 14 hours ago Flag

    Even though, as you say, Belaruskali and Uralkali are unlikely to materially increase their operational capacity over the next few years, once UralChem steps up and starts producing, another low cost, potash giant will emerge to the detriment of POT. Also, sometime in the 2020's, MOS will also have significantly expanded its production capacity, thereby increasing its Canpotex allocation to the detriment of POT. Sure, global demand is likely to pick up as the years go by but it isn't as if POT can just swoop in and capitalize big time. One of the few promising things coming down the pike will be what happens when this Rocanville expansion finally gets completed. It alone will be able to produce ~7 MMT of potash at not much more than $40 per metric ton. So that will keep POT in the game. But for as far into the future I can see, POT, like the rest of the Canpotex 3, will be price takers, not price makers. Which is why the stock is likely to just lumber along rather than streak upwards.

  • Reply to

    POT still lowest cost producer?

    by long_term_realizer Apr 28, 2016 4:59 PM
    abbaman7 abbaman7 Apr 29, 2016 12:00 PM Flag

    Belaruskali and Uralkali are each very low cost producers given that they pay their workers in local currency. POT gets to be the lowest cost producer once the Rocanville expansion is completed later this year. And their combined production represents a lot more potash coming onto the market than what POT produces. The high cost producers are IPI and K+S neither of which is doing very well at the moment.

  • An interview with CEO Tilk out this morning on Bloomberg News contained a statement that POT's confidence about how the markets will be shaping up later this year warrant that the current dividend will be sustained throughout the year.

  • My concerns have been allayed as it is now expected that construction will indeed be completed during 2016 with ramp up occurring late in the year. Something to look forward to given the extent to which operational costs should drop materially once the expanded operation is in full swing.

  • Reply to

    just a thought, no one will take over Potash?

    by chenrongguang Apr 28, 2016 2:36 PM
    abbaman7 abbaman7 Apr 28, 2016 3:30 PM Flag

    You need to familiarize yourself with Canadian takeover rules. There is a good reason why nobody is likely to ever make such a move.

  • Reply to

    POT will be trading $31 by next Q

    by jessi_the_cattle_dog Apr 28, 2016 10:55 AM
    abbaman7 abbaman7 Apr 28, 2016 2:35 PM Flag

    Magical unicorn type thinking evident from your headnote.

  • Now potash sells for less in NA than overseas. Imports playing a part in this story.

  • In response to a question regarding what projects are viewed as coming on line by 2020, Rocanville's increase of 3 MMT was mentioned without saying anything about when between now and 2020 when Rocanville's expansion will actually be completed. Very disappointing that given the opportunity to say something definitive about this project, the CEO avoided telling us anything.

  • Reply to

    Squeeze will accelerate for weeks

    by jessi_the_cattle_dog Apr 28, 2016 11:02 AM
    abbaman7 abbaman7 Apr 28, 2016 11:56 AM Flag

    I doubt it. Shorts have done well and continue to be on the right side of this trade. POT potash sales to India will be at rock bottom prices so there is nothing particularly positive regarding that. It is hard to price in bad news when the news continues to offer yet more bad news. The stock is heading down for a reason; things aren't going well and there are no signs of improvement any time soon. That assessment is called seeing things as they really are. And I still have all of my shares but I hold them without blinders on.

  • Reply to

    Kinda like this

    by razzledazzle5050 Apr 28, 2016 10:08 AM
    abbaman7 abbaman7 Apr 28, 2016 10:27 AM Flag

    I understand the case for selling POT. I sort of understand the case for holding onto the POT shares I own, weak as that case is. But what is the case for buying POT shares given its dismal prospects? It isn't as if there is a silver lining in anything we have heard thus far this morning from the company.

  • abbaman7 by abbaman7 Apr 28, 2016 9:33 AM Flag

    Lower earnings, lower revenues, no improvements in sight. And with reduced CAPEX, I am beginning to wonder what year the expansion of Rocanville into an extremely low cost facility, will ever get done. No mention of it in the press release.

  • Reply to

    Interesting Contact From Schwab

    by abbaman7 Apr 22, 2016 10:52 AM
    abbaman7 abbaman7 Apr 27, 2016 8:12 PM Flag

    I didn't bother pursuing it. And I noticed a distinctly negative aspect of the arrangement. Whereas now the dividends I receive from CALM are qualified dividends on which the maximum tax rate is 15 percent, any money I receive as a substitute payment for the loaned out shares will not qualify as dividends but rather will be taxed as ordinary income and therefore at a much higher rate. I don't need that. Indeed, it might even be that I would wind up losing money overall because of the disadvantaged tax treatment.

  • I was informed today that I can earn income from 'loaning' some of my fully paid for equities in a non-margin account to 3rd parties. Of course the interest here is the ability to short the stock. And the stock they are interested in among my holdings is... CALM. Not happening. But perhaps what this is telling me is that the amount of CALM shares eligible to be shorted is low.

  • abbaman7 abbaman7 Apr 20, 2016 2:29 PM Flag

    When you hear that Russia and Ukraine are no longer exporting wheat because of drought, that will be the time to see grain prices rise. Otherwise, hard to see anything other than some minor adjustments to current prices.

  • Reply to

    Any idea why POT is going up so much today?

    by subtilisg Apr 19, 2016 2:21 PM
    abbaman7 abbaman7 Apr 19, 2016 3:32 PM Flag

    Or some short covering. The news is all bad. POT's revenues and earnings will be down and there is no catalyst for any recovery this year and perhaps next year as well. There is even more potash competition coming soon from Turkmenistan where operational costs are not exactly high. The analysts are all saying the stock is heading down and there is no good reason to disbelieve them. Just not today.

  • I read somewhere a while back that China's own potash operations require a price of about $265 per metric ton to avoid losing money. So if China tries to drive a really hard bargain in the upcoming contract negotiations, it will be doing so at the expense of its own businesses. Whether that will influence its negotiating stance though is another story.

  • Reply to

    You Can't Make This Stuff Up

    by abbaman7 Apr 6, 2016 4:32 PM
    abbaman7 abbaman7 Apr 7, 2016 1:14 PM Flag

    Before I switched to Himalayan salt or unrefined sea salt when I can't get the Himalayan pink stuff, I used to use potassium chloride instead of refined table salt. Nothing wrong with that as long as you don't go crazy with it. Like most things.

  • There are Africans in Nigeria who are actually EATING potash and a senior research scientist says that excessive consumption of potash will reduce sperm production in men and can cause testicular injury. Apparently potash is used in the preparation of 'ewedu' and okra soups to boost the thickness and increase the greenness and texture of soups. It is also used in some parts of Nigeria to tenderize foods and shorten cooking time. However, it is not healthy to eat it. The main culprit in potash that is causing testicular problems and infertility in men is the high concentration of sodium in the potash.

  • Folks don't need any particular incentive to hit the SELL button when it comes to POT but CIBC World Markets analyst Jacob Bout is out with a comment that POT's 2016 earnings guidance already looks shaky and may be lowered further at the next earnings call.

  • Reply to

    I do not understand this stock

    by finanza Mar 28, 2016 9:37 AM
    abbaman7 abbaman7 Apr 5, 2016 11:42 AM Flag

    Perhaps folks are speculating that the deal with OCI will not go through. I noticed that Treasury came out with yet more new rules to inhibit inversion transactions like this one dealing largely with debt financing which may have little or no relevance to the CF-OCI deal. Still, the stock has dropped off a cliff having declined from $70 to $30 in 6 months' time. Sure agricultural prices and commodity prices have been on the downswing but the drop off here looks more profound than merely attributable to the usual suspects.

72.07+1.71(+2.43%)Apr 29 4:02 PMEDT