Russia‘s potash manufacturer Uralkali has announced that it will stop exporting its products through Belarusian Potash Company (BPC).
Uralkali’s board decided on July 29 that the company would export its fertilizers exclusively through a subsidiary trader called Uralkali Trading.
“We have to note with regret that our cooperation with the Belarusian partners in the framework of BPC has reached a deadlock,” said Uralkali CEO Vladislav Baumgertner.
“Uralkali has always insisted that exports by all manufacturers should be carried out through a common distribution network.”
The executive explained that this “fundamental principle” had been violated by Alyaksandr Lukashenka‘s presidential edict issued in December last year, which allowed Salihorsk-based potash giant Belaruskali to export its products not only through BPC.
“We have repeatedly drawn the attention of our Belarusian partners to the unacceptability of such actions, which have ruined the basics of our multi-year fruitful cooperation,” Mr. Baumgertner said.
“At the same time, we would like to express gratitude to our Belarusian partners for cooperation in the framework of BPC. We remain open to its possible resumption on the mutually beneficial basis in the future,” he added. However BPC declined to comment on Uralkali’s decision.
Mr. Lukashenka received Uralkali owner Suleiman Kerimov in Minsk this past May. The Belarusian leader called at the meeting for Belaruskali and Uralkali to “strengthen their unity in sales policy.”
“Any attempt at acting separately, especially now that we have established a joint company to sell potash, will only damage Uralkali on the one hand and Belaruskali on the other,” Mr. Lukashenka warned. “And we don’t hide the fact that we will be strengthening our unity in the potash market.” He said that everyone in Belarus, from the CEO of Belaruskali to the head of state, shared the opinion.
On July 25, Mr. Lukashenka approved the appointment of Alena Kudravets as BPC director general. Speaking to Ms. Kudravets, he noted that she was well aware of the situation in the potash market. “This is not only the sphere of potash fertilizers, this is the sphere of trade on a global scale,” he said. “It is not that you simply come and purchase something and then resell it as we are in the habit of doing. This is big politics in the sphere of sales.”
“We should by no means lose Uralkali because we are the most powerful company in the potash market if we are at one with the Russians,” Mr. Lukashenka said. “But we shouldn’t forget about Belarus’ interests as our partner is a private company. The goals of the government and a private company do not always coincide. Anyway, both of us want to sell more and at a higher price. This is natural. And our interests coincide here.”
Mr. Lukashenka directed that all potash sales should be taken under control and price policy should be carefully reexamined.
Founded in 2005 by Belaruskali and Uralkali, Belarusian Potash Company is said to control more than 30 percent of the world potash market. A 45-percent stake in the company belongs to Belaruskali and five percent to Belarusian Railroads.