Germany’s Chancellor plans lithium deal with Serbia after Rio ruling
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Russian potash producer Uralkali said on Tuesday that its former distributor, the Belarusian Potash Company (BPC), is selling the fertilizer at such a low price that it may make it impossible for the company to conclude contracts.
Uralkali also said the $220 per tonne set by BPC and China last week, did not reflect the current grim conditions nor the outlook for the fertilizers market.
“Potash producers incur high investment costs in order to maintain existing production capacities and develop new deposits,” the potash producer said. “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,” it said.
“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
In October, the company signed a supply agreement with India for this year that priced the nutrient at $280 per tonne. Uralkali didn’t have any contracts with India or China during 2019 because of low prices and oversupply of stocks – the first time in at least decade.
The price that major users in India and China agree with a producer is then typically used in contracts with other suppliers.
It wasn’t the case with last week’s deal signed between BPC, the exclusive exporter of potash produced by Belaruskali, and a consortium of Chinese companies. Those buyers included state-owned Sinochem’s fertilizer arm, Sinofert, China National Agricultural Means of Production Group and state-owned CNOOC.
Potash stockpiles are at a record high and exporters will likely want to clear them as soon as possible, CRU senior potash analyst, Humphrey Knight, told MINING.COM.
This means it will be months before China requires significant fresh supply and, as a result, spot prices will respond accordingly in late 2020, the expert noted.
Beijing has imported 3.2 million tonnes of potassium chloride (MOP) from Russia since October 2018 and 2.4 million tonnes from Belarus in the same period, according to data from the Global Trade Tracker (GTT).
Total global sales to China in the period hit 13.2 million tonnes, with Canada leading the list with 5.2 million tonnes.
Russia’s export to China in the first quarter of this year was about 690,000 tonnes, compared to about 290,000 tonnes of fertilizer the Asian giant bought from Belarus, and 1million tonnes from Canada.
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Afzal ali Jagirdar
Wish to know price ,stock, market movements about all type of fertilizers, phosphate ,, aluminium ,bauxite minerals and gold silver