China May Pay $150/Ton More To Import Potash
Citigroup tips China to pay $150/ton more for potash imports this year (sharply higher than $5/ton rise in 2007), mainly due to global tight supply;
China imports 70-80% of potash it needs to increase crop yield.
Expects China to sign 2008 trade contracts with export countries (e.g. Russia, Canada) after Communist Party congress in March, "as any major increase would reflect poorly on the government's effort to control inflation." Keeps Hold on Sinofert (0297.HK), major Chinese importer of potash, target at HK$7.60; stock +2.7% at HK$7.13. Still, says stock could have upside on potential M&A, asset injection from parent.
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