By reading up on the latest news stories crossing the wire today, I stumbled across news that indicated a bearish scenario in the potash industry. Basically, makers of potash have created a glut of supply that needs to be depleted before prices can begin to stabilize once again. This has hurt the stock prices of potash producing companies recently.

Potash has proven to be a great product to produce, considering the rapid rate of growth in emerging economies which is basically a result of a growing world population. It makes a lot of sense when you think about it, more people on the earth means there needs to be more food to feed those people.

However, the same way we have witnessed fluctuations in other commodities, such as oil, we will see big changes in the prices of potash from time to time. Just because the price of the asset depreciates for weeks or even months at a time does not mean it is not a good investment, however. To get an idea of how a long term investment in potash will perform, look at a ten or twenty year chart of oil or gold. This gives you some insight as to how much wealth can be generated by investing in precious commodities, and I believe potash should be included in that category.

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