There’s a new potash player on the scene. (The whole Canadian potash scene is starting to remind me of the old gold rush!)

Raytec Metals Corp. (TSXV: RAY) recently (back on July 15, 2008) received its first exploration permit on its potash claim in Saskatchewan (that’s where most of the world’s potash is), a province in central Canada. According to the Financial Post (Toronto), its shares jumped 21% on the news.

Raytec’s foundation looks good: they’re developing over 300,000 acres of potash claims (that’s a LOT of land!); these claims are directly adjacent to those owned by BHP Billiton (read: if this area was good enough for BHP, it will be good enough for Raytec too). Raytec also mines iron ore in the province of Ontario, Canada. They also have some uranium claims in Northern Saskatchewan and are clearly focused on providing for economic growth in Asia.

Back in July, Raytec said it was about to commence 2D and 3D seismic work on the claim before beginning phase two of their drilling operation. It has since also applied for an additional potash permit (July 17, 2008). Back then, (July 17, 2008), it was trading between 99 cents and $1.15 CAD.

So where is Raytec at today?

Today, it’s trading between $0.68 and $0.73 CAD, so there’s been a big correction. Much cheaper to buy now. And Raytec is still a very young company, having acquired these potash claims not quite so far back as February 2008. They officially became a tier-2 mining company in November, 2007, when they adopted the new Raytec Metals name. Even still, I think they’re worth considering. I might buy some, just to position myself well for any more potash growth. At this price the growth is more compelling. What about you, are you invested in any of these potash explorers? Do you have other thoughts on Raytec? I’d love to hear.

I’d forgotten about the Migao Corporation (TSX: MGO) several posts back when I wrote about junior Canadian potash plays (see related posts, below).

Migao was once (prior to 2006) a private, wholly-Chinese owned company, but then became a Canadian, China-based company traded on the Toronto Stock Exchange in May 2006. It has offices in Toronto and Beijing.

If you want to capitalize on China’s need for potash, I don’t think you can get much closer than Migao, which specializes in processing potash, turning it into fertilizer and selling it directly to the Chinese market.

Recently, (May 2008), Migao raised the prices of its fertilizer and also received a patent on their production process. MGO is still a bit pricey (PE at 23), but has significantly pulled back from its 52-week high around $12 CAD. Their earnings are right now around 34 cents/share.

I’ll be watching this one and picking it up when I get a chance. How does it look to you?

We’ve all heard about how important it is to be invested in the BRIC countries, but how many of your BRIC investments are direct-ownership?  You probably own through some middle-man that collects fees along the way, like the mutual funds and ETFs do.  Besides, not all the BRIC countries are equal when it comes to potential ROI.  Brazil has been the next great emerging-market for decades now, while China is actually outperforming, and at a quick pace.

The strategy I’m following right now is just to invest in China as directly as possible.  Normally that would mean stocks in China-based, China-owned companies.  And there are a few good ones (more on that in another post).  But you can also invest in North American companies that do business in China or provide essential services specifically to China’s growing economy.  One of these is Hanfeng Evergreen Inc (TSX: HF), a fertilizer-production company headquartered in Toronto that operates slow-release fertilizer plants throughout China.

Great Reasons To Invest in Hanfeng Evergreen

(1) HF is listed and traded on a domestic (i.e., North American) exchange - the Toronto Stock Exchange.  This means you don’t have to worry about all the hassles and barriers involved with trying to break into the Chinese stock exchanges.  Moreover, experts like Robert Hsu actively advise against doing that anyway, for various reasons.

(2) Capitalize on China’s boom.  This one is obvious.  China is growing at a phenomenal pace.  HF provides an indispensable, patent-protected service.  HF will grow too.

(3) Capitalize on the agriculture boom.  China is the world’s largest producer and consumer of fertilizer, but they don’t yet have enough of the fertilizer that HF produces.  HF owns a patent on the technology for their proprietary resin-coated slow-release fertilizer.  HF owns and operates five fertilizer plants in the main rice-growing regions of China.

(4) Hanfeng has a solid history of growth.  They began as Dalian Hanfeng in April 1996, starting out as importers of high-end grass seeds into China.  In 2001, they established nurseries in Dalian, Beijing and Shanghai, beginning to produce rather than just import.  In 2004, they moved from the TSX.V (Venture exchange) up to the TSX and began construction on their first SCU fertilizer plant in Jiangyan.  Since then they’ve been breaking into new markets like gangbusters.

Check them out here.  You might agree with me that this decision is a no-brainer.  They recently traded around $12.07 CAD.  Less than a year ago they were trading at just $9.66.  They don’t pay a dividend, but their nearest industry peers by market capitalization?  Potash Corp. and Agrium.

As always I welcome any comments, disagreement, suggestions, corrections, updates.