700 potash workers get layoff notices
Last Updated: Thursday, October 8, 2009 | 1:54 PM CT Comments0Recommend4CBC News
Potash workers in Saskatchewan have received another round of layoff notices.

The Potash Corporation of Saskatchewan issued notices this week to 700 of its hourly employees at its Lanigan and Rocanville mines.

Demand is down and the company has been stockpiling much of its inventory, said Bill Johnson, director of public affairs.

"The primary market that we have not sold any product to at all is China," Johnson said. "Normally, by this time they would have taken a significant amount of the production. So that's … been a significant setback."

The other major market for PCS is the United States and sales are down there, too, Johnson said.

Some analysts say China likely won't buy any potash until early next year, which would force prices even lower.

The layoffs are scheduled to take effect in November and run until February of next year.

Potash companies have been stockpiling inventories significantly for the past six months, according to Saskatoon commodity analyst Larry Weber.

"They're utilizing every bit of capacity that they have in their own grounds and even using rail cars that are stuck in sidings all over Western Canada, so it shouldn't be a surprise to anybody," he said.

There could be even more layoffs if demand doesn't pick up soon, Weber said.