Uralkali quits top potash cartel, sees global price fall

Written by Reuters | Moscow | Updated: Jul 31 2013, 20:25pm hrs
Russias Uralkali has dismantled one of the worlds largest potash partnerships by pulling out of a venture with its partner in Belarus, a move it expects will cause global prices to plunge by 25%. The break-up of the Belarus Potash Company (BPC) leaves North Americas Canpotex as the ruling potash export venture. BPC and Canpotex had accounted for 70% of global trade in potash, an important ingredient for fertiliser, and the duopoly had set identical prices in key markets such as China and India.

Uralkali said it was pulling out after reaching deadlock over sales and would export all potash via its Swiss-based Uralkali Trading. It may lead to a fall in the global potash price to below $300 per tonne in the second half of 2013, from the current $400 per tonne, it said. Lower fertiliser prices could result in rising demand from price-sensitive farmers in Asia.

Uralkali plunged 15%. Rival fertiliser firms also fell, with Germanys K+S down nearly 16%.

Uralkali CEO Vladislav Baumgertner said the partners had reached an unfortunate deadlock.