Between rising gold prices and the explosion of artificial intelligence, it’s not hard to find investors who are bullish on things like gold and copper miners.
The first are digging up the ore that many consider so valuable. The latter are digging up the copper to help build the data centres and semiconductors powering the next big technological innovation.
However, a popular theme investors are excited about often comes with stock prices that reflect that excitement.
Instead, it's sometimes worth looking for themes the market may not be appreciating yet. Here, while the theme exists, the stock prices of the companies may not have reflected it.
One such theme may be potash.
The critical mineral behind food security
Potash is not a mineral that sets the heart racing like gold, or even copper, given the role it plays in artificial intelligence.
But it is arguably even more important than either of those two minerals.
Potash is a key source of water-soluble potassium, one of three critical nutrients that are crucial to plant health and, as such, is used extensively in fertilisers around the world.
Potassium, thanks to potash, helps plants grow strong. It also allows them to fight disease and retain water better. This leads to improved crop yield and longer shelf life. Essentially, this means that potassium, through potash, allows for a higher quality and longer-lasting source of food.
The role that it plays in enabling a more robust crop is why many nations, such as the US and Canada, have labelled potash a critical mineral that is important for economic and national security.
Why potash could attract more attention
It is stating the obvious to say that food is important.
With populations growing and arable land being limited, as well as increasingly harsh weather conditions, potassium (and therefore potash) has become even more important in ensuring that the crops that are growing produce the highest and healthiest yield.
The issue is that potash is not found just anywhere.
In fact, most of the supply is concentrated in three specific countries: Canada, Russia, and Belarus.
Two of those countries (hint: not Canada) are undergoing economic sanctions from parts of the world, in particular from the European Union, which has made supply from these countries more difficult and expensive. When you add China, which is also a large supplier and prioritises domestic supply, the picture gets even stronger.
This means that a critical mineral, whose importance is largely increasing, may be coming to a period where supply will be challenged.
This means that increasing supply from a reliable source could become a major priority.
Buffalo Potash: Looking to bring new supply to market
This is where Buffalo Potash (TSXV:BUFF) comes in.
The miner, based in the potash hub of Saskatchewan, owns a site near two of the largest potash mines in the world and is looking to develop it to add a new source of supply, using an innovative approach to extracting it, which it hopes allows it to mine at a lower cost.
This ability to bring in a new important supply of the mineral is the focus of the most-followed narrative on the Simply Wall St Community.
The author believes that its Disley project in Saskatchewan has the potential to produce potash at a lower cost than traditional mining methods, using a patented horizontal drilling technique and a staged approach to development. With a preliminary study pointing to significant project value and first production targeted for early 2027, the company offers a potential new source of Canadian supply.
However, its technology still needs to prove itself at commercial scale, and further development will require further funding.
Ask Charlie how Buffalo’s costs could stack up against the potash giants.
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