Cracking The Fertilizer Cartel

How an unassuming geologist named TED PAGANO rediscovered Michigan's potash motherlode, outsmarted a global fertilizer company and raised $1.3 billion from Uncle Sam.

- By Chris Helman

The eureka moment came in 2012, when professor emeritus William Harrison of the University of Western Michigan invited Ted Pagano, then a 35-year-old freelance geologist, to his 27,000-square-foot geological repository in Kalamazoo. A rock nerd’s heaven, the warehouse’s heavy-duty shelves feature crates of minerals from across the state. But Pagano was there to see something specific: the 80 pallets of rock cores donated in 2008 by the Mosaic Company, a large ($11.1 billion in 2024 sales) NYSE-listed potash specialist. Cores are standardized cylinders of rock, three feet long and four inches in diameter. These were recovered from some 75 wells drilled back in the early 1980s to depths 8,000 feet beneath Osceola and Mecosta counties, a sparsely populated swath of central Michigan, into a layer of rock rich in minerals deposited by an ocean that evaporated millions of years ago. Those minerals include salt (sodium chloride) and potash (mostly potassium oxide), which farmers prize as a fertilizer. It’s a critical mineral—the U.S. uses 5.3 million tons annually and imports 95% of it, mostly from Canada.

Pagano was excited to see these cores because he hoped they would prove his hunch: that Mosaic had been sitting on a potash motherlode in Michigan far bigger than anyone realized. He suspected that the deposit, if properly developed, could provide 1 million tons of fertilizer per year for American farmers. That would be nearly seven times the volume that Mosaic’s little 150,000-ton-per-year plant in Hersey, Michigan, was producing. Putting up $70,000 of his own money, Pagano had formed Michigan Potash & Salt Company and was already leasing up mineral rights from ranchers and farmers in the area. Even so, Pagano says, “I went to the core lab with skepticism.”