AGU Agrium Feb 10

Fertilizer stocks have an enormous effect on the imagination of the  minds of analysts. There is no limit how high they cannot go and the logic is simple; you know that China and India are working themselves up the food chain and , given the numbers,  there will soon be a shortage. Malthus had figured this out about 200 years ago even though he came to a different conclusion. In the mean time we have had the bird droppings shortage on the islands off Chili to contend with  and other precursors  to this imminent shortage. Problem is the chart is not cooperating.

agu feb1o

The low, at about $30 was made some time ago and since then we have seen the stock work it’s way back up to where it is now. It could easily go a little higher, like $55 before it comes to a halt, but IMO it is time soon to get out as the stock needs another leg down to complete the pattern. this is true also for POT and MOS. The risk/reward is no longer there,