Shares in German potash producer K+S Group rose as much as 8.5% in Frankfurt, the largest intraday jump since April, after CEO Burkhard Lohr commented on solid demand conditions around the globe, according to Bloomberg. Lohr spoke at a Kepler Cheuvreux-organized German corporate conference on Monday, Jan. 16.
Kepler wrote in a note that Lohr said potash demand in 2022 had been hampered in Europe due to higher prices and limited availability of nitrogen.
Kepler analyst Christian Faitz said he believes K+S shares are “very attractively valued” for a company with a de-levered balance sheet, a potash price that has reached a bottom and found a new, higher normal than in the “rocky years” of 2013-2020, and an attractive dividend/share buyback policy. Kepler kept K+S as one of its top picks in the chemical sector.
Lohr reported that K+S has hedged 90% of gas needs for 2023, 77% for 2024, and 10% for 2025.