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Uralkali: Prices agreed with Belarusian Potash Company not appropriate

Christian Fernsby ▼ | May 5, 2020
Uralkali, one of the world’s largest potash producers, updates on its position regarding pricing in key markets.
Uralkali worker
Potash   Uralkali worker
Uralkali believes that the commercial conditions that were reached by Belarusian Potash Company (BPC) do not reflect the real market situation that is developing at this time, or its outlook.

Topics: Uralkali Belarus

The price that has been agreed is not appropriate either for the length of that particular contract, or for the industry as a whole.

Potash producers incur high investment costs in order to maintain existing production capacities and develop new deposits.

This activity is necessary to meet the growing global demand for fertilizers.

If contracts are agreed at the price levels agreed by BPC, in the long term this will drive producers to cut their capital investment and, ultimately, will lead to a shortage of potassium chloride in the market.

Uralkali recognises the instability of the current market and the difficult positions of all of its participants due to the current volatility and challenging outlook for the potash industry.

The goal of Uralkali is to establish high level business processes, both in terms of product and service quality and the speed of meeting customer requirements, which, in turn, requires certain indicators.

Therefore, Uralkali will need to consider whether it is prepared to conclude contracts at the price set by BPC.