Potash Corporation of Saskatchewan Inc. (PotashCorp), the world's largest fertilizer company and a major employer in the region, has announced it is laying off approximately 440 people in Saskatchewan and suspending production at one of its two mills in Lanigan by the end of the year. The Lanigan mill will remain in a "care-and-maintenance" mode.
Overall, Saskatoon-based PotashCorp is cutting more than 1,000 jobs in Canada, the United States and Trinidad in response to slower than expected global demand for its products. The company also hopes to cut operating costs in the potash sector by $15-$20 per tonne next year.
"This is a difficult day for our employees and our company," PotashCorp president and chief executive officer Bill Doyle said in a release. "While these are steps we must take to run a sustainable business and protect the long-term interests of all our stakeholders, these decisions are never easy. We understand the impact is not only on our people, but also in the communities where we work and live, and PotashCorp will work hard to help those affected through this challenging time."
The company expects most changes to be complete within the month, although some positions may go through a longer transitional period. Where possible, affected employees will be offered severance packages before jobs are cut involuntarily.
The news comes less than two months after PotashCorp reported a 45 per cent drop in year-over-year third quarter profits. Like many potash producers, the company has been struggling with uncertain demand, especially from developing markets like China and India, where much of the demand for potash was expected to come from.
The price for potash has fallen this year after Russian producer OAO Uralkali left a joint venture with Belaruskali in order to sell potash on its own.
In October, PotashCorp announced a price per tonne of $307 for potash, down nearly a quarter over the same period last year.
"While these are difficult decisions, we know that they help ensure our company remains positioned for the future and able to grow long-term value for those who depend on our sustainability and success," Doyle said.
