Russia’s Uralkali thinks potash price of $220/tonne not optimal

MOSCOW, May 6 (PRIME) -- Russian fertilizer producer Uralkali plans to understand whether it is ready to sign potassium chloride contracts at U.S. $220 price per tonne like Belarusian Potash Company did on April 30 with a consortium of Chinese buyers, the company said in a statement on Tuesday.

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

In the long run, this price would drive companies to cut their capital investment, which will lead to a shortage of potassium chloride. The company understands that the global market is unstable now, and positions of all market participants are unstable due to volatility and unfavorable outlooks for the industry, the company said.

“The goal of the company 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, the company will need to consider whether it is prepared to conclude contracts at the price set by BPC,” Uralkali said.

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