Emotion has in the end trumped reason. Bowing to grassroots opposition from the prairies, the Canadian government has thrown what may be an insuperable obstacle into the path of BHP Billiton’s bid for PotashCorp.

Ottawa has declined publicly to give reasons for its decision to block the transaction. But the rules of Canada’s foreign investment law require a bid to be of “net benefit” to the country. The only conclusion possible is that Canada has taken a most restrictive view in deeming the bidder to have failed this test.

BHP strained every sinew to make its bid attractive to Canada and the province of Saskatchewan, where the target mines its potash. It promised to make the province the hub of its potash activities; actually a repatriation of power as Potash has largely been managed out of the US. It was willing to protect Saskatchewan’s tax revenues, which might have fallen temporarily because BHP could have offset Potash’s profits against the costs of a separate green field development in Saskatchewan. This was anyway just a timing issue; the development would have led to higher revenues in time. And it would have invested in infrastructure to secure goodwill.