Ny, (PressExposure) May 02, 2012 -- In a recent Penny Stock Detectives article, editor Sasha Cekerevac, names the stock that he thinks is poised to become the lowest cost potash producer. He believes that agricultural commodities have continued to be strong performers over the past few years due to the increased worldwide demand for food and adverse weather conditions. Cekerevac argues that U.S. farmers are going to take advantage by planting as many crops as possible and trying to attain the highest yield possible. This means that fertilizer use will be high, driving corporate earnings for companies supplying this essential farming input.
"One of the few penny stocks in the fertilizer sector is IC Potash," said Cekerevac. "This fertilizer producer is in the very early stages of development in mining sulphate of potash and sulphate of potash magnesia on its property in New Mexico. IC Potash is going to extract mainly sulphate of potash, which is higher quality potash that doesn't contain chloride and is sold at a premium price. With agricultural commodities remaining at high levels, farmers are more than willing to use this input to increase crop yields."
According to Cekerevac, IC Potash is expecting to be the lowest cost producer of sulphate of potash in the world. He reports that IC Potash has prospecting permits for over 100,000 acres of land on its property in New Mexico. With regard to this property, IC Potash has completed a deal in which it has issued approximately 30 million shares for $40.0 million at a price of $1.32 per share to Yara International, according to the Penny Stock Detectives article. Yara sells its products in over 150 countries. The deal also includes selling 30% of all products IC Potash produces, at market prices, to Yara for 15 years.
Cekerevac feels that this is a great deal for IC Potash for two reasons: 1) the company gets immediate funding to develop its property, 2) it now has a well-experienced firm in its industry that can help as a joint partner in expanding efforts to distribute, market and sell potash to the end user. He points out that Yara will now own 19.9% of IC Potash, which means it has an intrinsic interest in the long-term viability of IC Potash. Based on the prefeasibility study by the company, Cekerevac thinks that the project might prove to be a great property. As reported in his Penny Stock Detectives article, the company estimates annual production, once at full capacity, of 568,000 tons of sulphate of potash and 275,000 ton of sulphate of potash magnesia. Cost per ton for both is estimated at $147.00 per ton. An investor would need to be patient, says Cekerevac, as this project is still several years away. An environmental assessment is still in order, with construction beginning in late 2013, production starting in late 2015, and full capacity won't occur until the middle of 2017. Along the way, many hiccups can occur, warns the editor, but he feels that the fundamentals are present for a potential success story.
Published every business day, Penny Stock Detectives researches and analyzes low-priced opportunities in the stock market and individual stock market sectors. Penny Stock Detectives reports on penny stocks, small-cap stocks, micro-cap stocks, high-profit potential plays mostly under $10, and the stock market in general.
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Sasha Cekerevac, BA, and Danny Esposito, B. Comm., lead editorial stock analysts at Penny Stock Detectives, in conjunction with stock market guru George Leong, B. Comm., have just updated their breakthrough video, If You Missed Apple, Shame on Us; If You Miss This...highlighting a company these stock analysts believe looks very similar to Apple Inc. in its early days. To see the video, visit: http://www.pennystockdetectives.com/video/pt/index.php?sb=PRESS.