Goldman Sachs downgraded the rating of Sinochem Fertilizer (0297.HK) from purchase to sale, and lowered the target price from HK$4.40 to HK$2.80. Previously, it lowered its earnings per share forecast for the 2011-12 fiscal year by 24.5% and 42.9%, respectively. The bank expects potash prices in China to rise in the next year due to tight global supply and higher potash import contract prices. The bank said that based on the view that the increase in the cost of potash fertilizer from now to 2013 is far higher than expected, the bank believes that it will be difficult to completely pass on the increased cost by raising the average sales price; in addition, Sinochem has reached a minimum purchase quantity agreement with Canpotex. The bank believes that this will leave Sinochem Fertilizer with no choice but to accept further price increases from Canpotex. Sinochem fertilizer closed down 10.5% to HK$3.06.