Nutrien chief executive talks tariffs at U.S. conference

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Canada’s largest potash miner has been moving as much of its product as possible into the United States to get ahead of potential tariffs as farmers prepare for spring seeding, but Nutrien Ltd. chief executive Ken Seitz says the company will not be the one feeling the worst impacts if tariffs do come to pass.

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“We ourselves (Nutrien) supply about 40 per cent of that market and, of course, Canada supplies well over 80 per cent of the U.S. farmers’ potash needs,” he said during a fireside chat at the BMO Global Metals, Mining & Critical Minerals Conference in Florida on Tuesday. “The cost of tariffs will be passed onto the U.S. farmer; that’s our view,” he said.

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Seitz’s comments come after U.S. President Donald Trump pledged to put 25 per cent tariffs on Canadian exports to the U.S. The levies are expected to take effect March 4 after he paused them earlier this month.

Seitz said the most exposed part of Nutrien’s business would be its potash operations since the American market generally consumes 10 to 11 million tonnes of potash per year, with much of that coming from north of the border.

Potash is crucial in maintaining soil fertility and crop yields and Canada supplies 85 per cent of the U.S. needs, according to a recent report by Royal Bank of Canada. That total could go higher if the U.S. pulls back from Russia and Belarus, which are its only other major suppliers.

Seitz also expressed optimism about the future, with Nutrien projecting market demand to be between 71 and 75 million tonnes this year, mainly driven by the positive outlook in Brazil and Southeast Asia. In 2024, consumption was around 72.5 million tonnes.

“The demand side of the equation continues to be quite strong and that’s encouraging,” he said.

Seitz also said some overseas producers in Laos are dealing with operational challenges that could impact their production, while producers in Russia and Belarus have announced their operations will have to go offline to undergo maintenance.

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“Put that all together, and that’s led to this tightening in the market and to the price increases,” he said.

On the retail side of Nutrien, Seitz credited the company’s strong earnings to its cost-cutting efforts that involved workforce reductions as well as shuttering some locations.

One market observer shares Seitz’s optimism on the potash front.

“With significant underutilized potash capacity, Nutrien is well-positioned to benefit from favourable long-term demand for potash,” Hamir Patel, an analyst at CIBC Capital Markets, said in a note on Tuesday.

He said there will be strong price growth in offshore markets as well as price increases in the U.S. Midwest.

Overall, Patel said Nutrien’s operations are vulnerable on a number of possible fronts, such as weather and operational challenges along with natural gas prices, which could impact production at some facilities, as well as U.S. tariffs.

“Potential U.S. tariffs on Canadian fertilizer products may affect profitability,” he said.

mhansen@postmedia.com

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