Everyone knows that the Potash Corporation of Saskatchewan is the world’s biggest producer of potash, by far (almost twice as much production as its closest peer), and that Canada overall has larger stores of potential potash than any other country.  But there are other potash producers in Canada.  Mosaic, for one, is another large producer.  But Mosaic and Potash Corp. don’t have a monopoly on the market.  There’s enough potash in Canada (mostly in Saskatchewan) that there’s room for other players.  These are the only junior Canadian potash plays.*  I’ll list them in increasing order of their trading volume, so you can see at a glance which are the most active.

Anglo Potash Ltd. (TSX: AGP) - Recently traded at: $8.11, volume was 22K.  52-wk trading range: $1.60-$8.13.  Up until February 2008, Anglo used to be called Anglo Minerals.  Then, I presume as a result of the potash boom, they changed their name to Anglo Potash.  It must have worked because in May 2008, BHP Billiton put in an acquisition offer to buy them at a share price of $8.15.  If the deal goes through, BHP will acquire this producer in July 2008 (yet another reason, I think, to load up on BHP if you haven’t already).  So keep an eye out; you might want to buy Anglo if the deal doesn’t go through, but I haven’t seen anything indicating it won’t.

Athabasca Potash Inc. (TSX: API) - Recently traded at: $7.70, volume was 76.5K.  52-wk trading range: $3.60-$10.47.  Another Saskatchewan-based producer.  In 2007, they drilled five new holes in their wholly-owned Burr Project.

Hinterland Metals (TSX: HMI) - Recently traded at: $0.12, volume was 193K.  52-wk trading range: $0.07-$0.30.  I just wrote about Hinterland in a recent post here; this company is a diversified minerals producer and has just entered the potash market in the Maritimes.  Could be a good opportunity to get in on some non-Saskatchewan potash (the Potash Corp. of SK is already there mining in a nearby area, btw).

Potash One Inc. (TSX: KCL) - Recently traded at: $4.64, volume was 340.4K.  52-wk trading range: $0.93-$6.25.  I own some KCL and it’s gone up about 25% since I bought it not too long ago.  Potash One’s management most recently also had success with building up and selling a strong uranium company.  Their Legacy Potash Project is located immediately adjacent to the largest potash mine in the world.

None of these companies pay dividends; these are all growth plays.  But I’ve taken an interest due to the potash boom.  From what I’ve read there is much more room for potash growth.  China still can’t produce anywhere near enough it on its own, although you should check out the Qinghai Salt Lake Potash company and stay up to date on what they’re doing.

*Based on my own research and reports I’ve read.  Of course, if I’ve left something out or have not heard of one, which is always possible, please do let me know.

Here’s one of Jim Rogers’ latest interviews with Bloomberg (June 5, 2008). I always smile at these. He seems so annoyed and frustrated at talking with journalists and reporters. It’s as though he feels that it’s all so common sense - of course you should know that bankruptcies are signs of bottoms and that means it’s a good time to be buying into the airline industry!:) Betty gets him riled up about all the usual suspects: the Fed, Bernanke, the banks, what he’s shorting, commodities, food, gold, Soros, oil and more commodities.

“If People are Talking About a Bubble, I’d Like to Know What They’re Talking About… Sugar’s down 80% from its All-time High - What Kind of Bubble is that?”

I’m actually surprised that he does go into so much detail on all the stocks he owns and what he’s short and how much etc. on national broadcast. Betty even asks him if he’s short on Lehman Brothers. Turns out he’s short all of them through his investment bank ETF.

A few people I have talked to have been wondering about how they can invest in gold. Well, as Jim Rogers once said - once your local newspaper starts talking about how the dog next door just got started in commodites, then it’s probably time to get out. I’ve read more than a few stories from people just waiting for the commodity bubble to “burst.” I’m not really in that camp. Based on my understanding, there isn’t much of a commodity bubble, and there can’t be, almost by definition. Commodities are real, tangible assets. You can’t actually fake the amount of rice or gold in production around the world. Your creative accounting team might be able to sketch up the numbers here and there, but when supply meets (or doesn’t meet) demand, it’s pretty straightforward. This is why I think it’s always a good time to be in commodities. I’m not a market-timer, I just invest for the long run and for current cashflow. I don’t really mind if gold goes up and down over the month, and I don’t pay much attention to it.

A Bank of Virtual Gold

My recommendation for would-be gold and silver investors is pretty simple. Use Goldmoney. Since 2001, they’ve been the leader in the new “digital gold” industry. The best way to describe their service is to think of them as an online bank that deals only in metals. They keep the real, physical metals in their secured vaults (unlike regular banks, which rarely are required to even keep 10% of their supposed holdings on hand), and you log into your online account where you see the electronic totals of the gold and silver you own. And you actually do own specific physical pieces of that gold and silver. It’s not an abstract “pooled” account where everybody’s gold could be anybody else’s. If there were a run on GoldMoney, they’d be able to give everyone their exact bars of gold right away. Your bank can’t even do that.

Located in Jersey, in the Channel Islands (UK), Goldmoney allows you to purchase gold, silver, platinum and palladium in several major currencies. It’s free to open an account. You can purchase in Canadian dollars, then later sell back into US dollars. Or Euros. Or pounds. Or Swiss francs. On top of this, you can even pay for certain goods and services with your gold. They have a list of their affiliates on the site.

Goldmoney is not only extremely secure (quarterly audits and insurance), but they also own several patents for their innovations. Bubble or not, Goldmoney continues to grow at an impressive rate and is going to be here for quite a while. What I most like about the site itself is to read the bi-weekly updates of James Turk, the founder. It’s basically a little blog on the price of gold around the world. Turk is a famous gold-bug. But don’t let such names get in the way of perceiving the great value that a service like this has to offer. I’ll probably say more about Turk and Goldmoney in a future post, but for now, you should really check out the rest of the details yourself. And of course, you’re always welcome to contact me about it too if you’d like more of a personal testimonial.

What do you think? Have you used GoldMoney or a similar service? I’d love to hear about it.