Mosaic, the world’s leading producer and marketer of concentrated phosphate and potash, is laying off 46 workers at its Colonsay mine in Saskatchewan. The permanent downsizing will take effect in mid-December. In an effort to curb lay-offs, the company had initially offered an early retirement option to 90 employees but after only 22 of them had accepted, Mosaic opted for permanent layoffs. Mosaic’s stock market performance has been steadily declining for a few years. While the stock was worth $88.11 per share in February 2011, at the beginning of this month, a per share price hit its five-year low at $30.14.
Mike Pulak, staff representative for the Steelworkers’ union, which represents the workers, commented that they were “extremely disappointed about this announcement considering the company is still massively profitable”. Another Mosaic official explained that the supply chain was still extremely full at the moment and the market was getting more and more competitive. “We have expansions coming online, we have new entrants into the market and so we are having to make some tough decisions,” the company said.
Saskatchewan’s Minister of the Economy, Bill Boyd, strongly believes that potash will bounce back. “They’re seeing much stronger sales orders coming forward than they have seen in a long time,” he said. “So they were quite optimistic that the numbers are turning around and that we have bottomed and are working our way out of it,” Mr Boyd commented. The United Steelworkers added that they hoped that Mosaic’s layoffs would be called off as soon as potash production goes up. However, Mosaic expects the layoffs to be permanent in any case.