With India and China halting potash imports, Russia's Uralkali is cutting potash output by half to 2 million tonne in December-March period to reduce excess global supply. This would help the world’s largest Potash miner to cope with a protracted fall in demand. “Starting from December and during the first quarter, we will work with 50% capacity as demand will be rather weak,” a Uralkali spokesperson said on Thursday.
Uralkali, the second-biggest potash producer after Canada's Potashcorp of Saskatchewan, expects to sell about 1.6 million tonnes of potash in the first quarter of 2013.
India is the world's second largest importer of fertiliser and its import quantities are enough to influence global prices. Industry sources said India is unlikely to go for potash imports till the end of the financial year.
According to Canada's Potashcorp, global shipment of key fertiliser potash are expected to decline by 3.6% to 53 million tonne in the current calender year on account of reduced demand from India, among other factors.
The BPC trading company, a joint venture of Uralkali and Belaruskali, will look to maintain prices close to current levels — $470 per tonne and $490 per tonne, respectively, the spokesperson said.
Indian Potash, which is authorised to import potash for the country, had agreed to buy about 5.5 million tonne for $490 a unit last financial year, but did not lift more than two-thirds of the quantity as the weak rupee and the delayed government subsidy receipts affected its liquidity.