DBRS Releases Report on Potash Corporation

DBRS has today released a report on Potash Corporation of Saskatchewan Inc. (PCS or the Company) that provides further detail on the May 22, 2013, confirmation of the Company’s BBB (high) Issuer and Senior Unsecured Debt ratings and its R-1 (low) Commercial Paper rating, each with Stable trends.

The Company’s status as the leading producer of potash fertilizers is enhanced by a strong U.S.-centered phosphate-based business and a lower-cost nitrogen-based business focused on the North American market. The successful completion of its current potash expansion program, expected by 2015, will bolster the Company’s market position as a key potash supplier.

Nonetheless, with steadily growing food demand matched to potentially chunky increases in production capacity, potash prices could be volatile over the next few years. PCS’s credit metrics may weaken from their current strong position before recovering potash markets lead to higher operating cash flows. DBRS expects the Company will need to be judicious in managing expenditures for expansion projects, shareholder returns or acquisitions in a period of expected potash price volatility to maintain its current credit strength.

Notes:
The applicable methodologies are Rating Companies in the Mining Industry (primary) and Rating Companies in the Industrial Products Industry (secondary), which can be found on our website under Methodologies.

The full report providing additional analytical detail is available by clicking on the link below or by contacting us at info@dbrs.com.