Wednesday, January 9, 2013

how Potash prices drop by Canpotex for China complicate negotiations BPC with India ?

Reducing Potash prices drop by Canpotex complicate negotiations for China BPC with India
Reducing Canadian trader Canpotex potash prices for China by 70 USD per ton has complicate ongoing negotiations BPC / BPC, international trader "BRIC" and "Belaruskali" with India. This opinion was expressed in the survey industry analysts Sberbank CIB.

December 31, 2012 Canpotex / international trader of Canadian potash producers PotashCorp, Mosaic and Agrium / signed with the Chinese Sinofert contract for delivery in the 1st half of 2013 one million tons of potash at a price 400 dollars per ton. Compared to previous contract, price reduced by $ 70 per ton.

"The deal is - according to a survey - complicate negotiations between BPC and India. Indian buyers will clearly require a price close to the one that got China - 400-420 dollars per ton - when the last contract was at price $ 490 per ton, while we expected price  $ 430 per ton / CFR /, and, most of all, they can get their way. "

Moreover, it is noted in the review, signed a contract with China, Canpotex bypassed by terms BPC, which, according to the unofficial rules, is a leading negotiator with China and India.

"Discipline potash producers - emphasizes Sberbank CIB, - weakened." CCB now has to decide whether to accept the terms of the deal with China Canpotex or not to contract for these conditions. According to Sberbank CIB, "Uralkali" accepts these conditions and sign a contract for small amounts.

"Uralkali" has been reported previously, expects to sign a contract with BPC India in January, and with China - in April - early May. As noted at the end of December, the General Director of "BRIC" Vladislav Baumgertner, expectations tosigning term related to the state of accumulated residue of potassium chloride in these countries. In India, according to him, the accumulated balances at year-end were at a level which would rely on the signing of the contract at the beginning of the first quarter, while China's reserves are about 4 million tons with a total market of 10-11 million tons per year.

At the same time in China at the end of 2012 year set a low price for fertilizers. According to expectations "BRIC", the situation may change in China in May. "To reduce the accumulated residue of potassium chloride in this market, we intend to reduce to zero rail shipments to China, which will in April and early May to sign a contract for naval supplies," - then spoke Baumgertner.

"Uralkali" thus expected that the price of potash to China and India will remain the same, but did not rule out the provision of a small discount to customers in connection with the backlog of demand on supply. "As the market has recently been overloaded, and the demand was low, we think it will be a small discount. This is a small discount, not price cut," - emphasized Baumgertner. About price will be at $ 400 per ton, according to him, not a speech.

Previous contracts "BRIC" with China and India for potassium chloride supply were made at prices respectively $ 470 per ton and $ 490 per ton.

About Potassium

Potassium is one of the sixteen nutrient elements which is needed by plants for healthy growth. It is second only to nitrogen in the quantities required by plants.

Potassium is very mobile within plants, and performs a wide range of vital roles in plant systems, including photosynthesis, enzyme activation, stomatal control and transporting plant sugars.

Although potassium occurs naturally as up to 3.5% of the earth's crust, only a small proportion of it is available to plants.  After many years of agricultural production, and removal of potassium in produce harvested from the field, even soils which were naturally well supplied will become depleted.

If soil potassium supplies are insufficient to meet plant requirements, supplementation by potash fertilisers - fertilisers containing potassium - is necessary to maintain healthy plant growth and a sustainable agricultural environment.

Select a button above right to find out more about potassium in plants, soils and fertilisers.

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