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Ken Seitz, Exec. VP and CEO of Potash at Nutrien Ltd (TSX and NYSE: NTR), Discusses How the World’s Largest Potash Producer, is Positioned to Meet the World’s Long-Term Potash Needs

on 7/20/2021
We spoke with Ken Seitz, who is the Executive Vice President and CEO of Potash at Nutrien Ltd (TSX and NYSE: NTR). Nutrien is the world’s largest potash producer, with over 20 million tonnes of potash capacity at their six low-cost potash mines in Saskatchewan. Nutrien is a globally integrated, agriculture company, with an extensive reach in key agricultural markets, particularly in Canada, Brazil, Australia, as well as in over 40 countries around the world. With decades of high-quality reserves and their multi-year expansions complete, Nutrien is well positioned to meet the world’s long-term potash needs.

Potash at Nutrien Ltd.

Dr. Allen Alper: This is Dr. Allen Alper, Editor-in-Chief of Metals News. I’m talking with Ken Seitz, who is the CEO of Potash, Nutrien Limited. Ken, can you give us an overview of your Company and what differentiates your Company from others and your goals and visions?

Ken Seitz, CEO of Potash, Nutrien Limited

Ken Seitz: We say that our purpose is to grow the world from the ground up, and what we mean by that is we're a globally integrated agriculture company with an extensive reach in key agricultural markets. Our business is a thriving and growing retail business, with products and services, right at the farm to service our growing list of grower customers, in key agricultural markets domestically, Brazil, Australia, and growing that presence from a retail perspective. But also looking at working with our customers on the retail side, in new and technologically advanced ways. So, looking at our digital capabilities and how it is that we continue to service those customers, in the most effective and efficient way possible.

We back that retail arm of our business, with an extensive crop nutrient supply network. It's the largest provider of crop nutrients on the planet. It's our solid nitrogen base, with plants all over North America. It's our phosphate business, in the US, and it's our Canadian potash business. That's the one I'm involved with. We are the largest potash producer on the planet. We have a network of six potash mines here in Saskatchewan, Canada, where we work and supply potash domestically, to our customers here in North America. Internationally, via our export company, we're a partner with Mosaic, to offshore markets over 40 countries around the world.

It is really that the world needs food, and the world is going to need more food. With the growing population base and calls for higher quality food, Nutrien is the best positioned company on the planet, from an integrated point of view, to be able to service that need, from a retail perspective and from a crop nutrition perspective.

Potash at Nutrien Ltd

Dr. Allen Alper: That sounds excellent. Could you tell our readers/investors a little bit about your background and your Team?

Ken Seitz: I am a Canadian, from here in Saskatchewan. I started my career in the nuclear energy business. Saskatchewan is one of the largest uranium producers on the planet. I'm an Engineer and spent a lot of time, working in the uranium mining business. Then I transitioned that career to the more commercial aspects of the business and spent a lot of time in corporate development, sales and marketing all over the world.

About six years ago, I left that business and joined the potash business as the CEO of Canpotex, which is the export arm of Mosaic and Nutrien Saskatchewan Potash. Canpotex sells to over 40 countries around the world, but also manages the supply chain. They get the potash at the mine gate, from its shareholders, and send it all over the world. I was the CEO there for four years and most recently joined Nutrien, about 18 months ago, in this capacity, as the Executive Vice President, CEO of Potash with Nutrien.

Dr. Allen Alper: That sounds excellent. Could you tell our readers/investors a little bit more about some of the other members of the Team and the Board?

Ken Seitz: We have a new CEO, who is very accomplished in the agriculture space. He spent an entire career, working in agriculture, with broad international reach, working in just about every corner of the planet. His name is Mayo Schmidt and he joined, about a month and a half ago. Mayo is looking to build on our strengths and capabilities that I just described and that's this integrated agriculture company with this global reach.

Beyond that, we have an Executive Team. We have the CEO of our nitrogen and phosphate business unit and a CEO of a retail business unit, although we’re searching to fill that CEO position, at the moment. The balance of our Executive Team is comprised of one of the corporate service groups and obviously our CFO Pedro Farah in corporate Development, Legal HR. We have a solid complement of executives, within the potash business unit. We are doing the things that you would probably expect. We have a strong engineering focus, on our network of six mines and are expanding production at those mines. We have significant available capacity there, to put into the market, four to five million additional available tons, to go into the market. Beyond that, another five million tons of brownfield opportunities to develop and put into the market.

We find ourselves in a growing demand environment. We expect to be able to place those tons in the market, when our customers are calling for them. We have strong engineering capabilities. On the business side and the commercial side, we've been at this potash business here in this province for over 70 years now. So, a big international reach, really skilled sales and marketing people and very talented businesspeople and make up the bulk of our team here in the potash business.

Some of the other important skills that we have and are of all that obviously are on the ESG ( Environmental, Social and Governance) front and looking at our own environmental footprint, including emissions. Improving equity, diversity and inclusion, not just in the potash mining business, but in the mining business, the mining industry globally. First and foremost, among everything I said is safety and our safety capabilities and doing this all in a way that keeps people out of harm's way.

Dr. Allen Alper: That sounds great. Could you tell our readers and investors a little bit more about the market you serve and the products you sell?

Ken Seitz: We're in the potash business and the absolute bulk of what we produce, over 90% of it is for agriculture. It’s for farmers to put on their soil and hence the nutrient compliment in that soil in order to grow better crops. Potash plays a really important role in not just yield, but also in disease resistance and in and plant quality or crop quality. Farmers around the world have realized and are realizing the significant benefits from the appropriate potash application rates. As such, we have seen demand growing at about a 2.5% average annual growth rate. We expect that to continue into the foreseeable future again, as the world needs more food, higher quality food. That's what we do. We are servicing markets all over the world. The biggest markets would be in Brazil, which is growing, and China, India, Malaysia and Indonesia for the offshore markets. Then domestically, here as well as in North America and Canada, those would be our largest markets. Where we're sending our nutrient potash to over 40 countries around the world, as an important crop nutrient.

Dr. Allen Alper: That sounds excellent. Could you tell our readers/investors a little bit about your capital and share structure?

Ken Seitz: We're a publicly traded Company and as such we have our own leverage and leverage ratios and are traded on both the New York and Toronto stock exchanges. In terms of capital structure, we say that we have a hierarchy of things, we want to sustain our assets. That's utterly critical. We need to ensure that the asset quality is at a level that our customers and our stakeholders have come to expect, so sustaining our assets.

We talk about protecting our balance sheet and doing that in a way that helps us in any downturn. We have opportunities in front of us and we want to be able to capitalize or seize on those opportunities when they come our way. Then maintenance of our dividend. We have a strong dividend and that's an important component of our overall value proposition to a shareholder. That's how we think about our capital and capital structure.

Dr. Allen Alper: Excellent. Could you tell our readers/investors the primary reasons they should consider investing in your Company?

Potash at Nutrien Ltd.

Ken Seitz: Agriculture certainly has always occupied an important space on national agendas. I think if anything, with COVID, the focus on food security is even greater. With the growing population and a few billion people being moved into the middle class, over the last decades and again demanding higher quality food and frankly, more of it. Then, with farmers waking up to the benefits of crop nutrients, and as they become more educated on the topic, consume more. Again, we find ourselves in this growing demand environment and that's from a potash perspective. But we're an integrated Ag company. We can continue to meet growers needs, from a retail perspective, and with their crop nutrients, in this growing demand for food environment.

Dr. Allen Alper: That sounds excellent. Is there anything else you'd like to add?

Ken Seitz: We have just recently announced the very strong and robust global demand in 2021. Also, a few recent supply side events, one with supply disruption here in Canada. We announced that we would step in and increase our own production by 500,000 tons. Most recently, the EU is saying that they're going to impose sanctions on Belarus. Belarus, as a Country, is a huge potash producer, that is another supply side event. With those two supply side events, the first one we announced, we produced an additional 500,000 tons that's in addition to the 12.5 to 13 million tons that we were giving the market. Most recently, with the announcement of these Belarus sanctions, we've announced just yesterday, we're going to increase production by another 500,000 tons. So, a million tons increase, in total this year, which is a really substantial increase in production for us and hopefully steps into the market and meets our customers’ needs in an environment where we've had a couple of these supply side shocks.

Dr. Allen Alper: It sounds fantastic.

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