A recent article in the Star Phoenix has left some with worry while others barely see it as a blip on their radar. Economic observers say it is too soon to say what will sort of effect will be felt with the news of mining company, Vale, putting its potash project near Kronau on hold. Keep in mind this is just one company and one resource and we have another linchpin playing a part in our resource boom-the Bakken oil find. University of Saskatchewan economist, Eric Howe, noted that calculations based on data about previous resource booms in the province have suggested the current boom is likely to be over by 2019. Vale is also primarily an ore mining company that also does potash and there is an indication that iron ore is in demand more than potash, hence the delay.
The delay combined with the slow down with PotashCorp (they are shutting down for a month) has some people talking. Sask Trends Monitor publisher is not concerned as there are always ups and downs in one commodity or another. If someone else announced a delay or postponement though we may then see reason for concern, according to Doug Elliot.
Keep in mind BHP is proceeding with construction near Jansen and the announcement of Vale is not impacting anything where they are concerned. BHP’s mine at Jansen will be the world’s largest potash mine, producing eight million tonnes annually at full production. Germany’s K+S AG started digging ground in June on its potash mine near Bethune. Some people speculate that the delay means potass supply may be slower which can increase potash prices and ensure even larger profits for existing producers.
As a real estate agent in Saskatoon I have people who hear this news and expect that house prices in Saskatoon will drop. We are not a one resource province or city so I have my doubts given the amount of people and companies moving to our city who all need places to live, but if I had a crystal ball I would be off living on a remote island retired!
As I don’t have that crystal ball I will still be living here and selling houses in Saskatoon so if you are looking to buy or sell get in touch with me and find out why I am a trusted Saskatoon real estate agent.