No plans for cheaper BPC fertilizers in favor of volumesNo plans for cheaper BPC fertilizers in favor of volumes
MINSK, 25 November (BelTA) – Belarusian Potash Company (BPC) does not intend to reduce prices for potash fertilizers for the sake of selling more of them. The statement was made by BPC First Deputy Director General Alexander Polyakov, BelTA has learned.
“We do not approve of the idea of selling as much as possible at a minimal price and leaving manufacturers without profits. Although considerable volumes can be sold right now at a price bordering on the loss-making one,” said the executive.
In his words, experts expect the potash fertilizers market to get stable in the near future as the situation brought about by Uralkali’s pullout does not satisfy any of the market players. “Some companies may afford selling at a loss but only for a very short time. The prices that have evolved allow minimal profits for the majority of manufacturers. Nobody is going to live with that for a long time. Therefore consolidation will happen anyway. According to our estimates the prices will gradually go up starting the beginning of the next year,” believes the BPC representative.
It is yet difficult to talk about specific prices for potash fertilizers in 2014. “All the market participants are waiting for the Chinese market to liven up. Prices for Chinese contracts are used as a kind of a guideline for the rest. Since none is available now, all the traders operate within their understanding and risk without buying a lot,” explained Alexander Polyakov.
BPC advised treating any statements regarding prices for Belarusian potash fertilizers with caution. The market has its peculiarities, it has a limited number of manufacturers and a high degree of competition that has gone up many times over in view of the latest events, in particular, Uralkali’s pullout from sales facilitated by Belarusian Potash Company and the aggressive policy the Russian company is now pursuing on foreign markets. “In the present conditions manufacturers are forced to defend themselves, including via mass media. Any publication, any shred of light cast on the events going on on the market (prices, specific volumes and so on) can be interpreted by competitors for their own ends. This is why BPC is very restrained about making comments. Avoiding errors and preventing the release of information that can become harmful are the main tasks now. We prefer doing over talking right now,” noted Alexander Polyakov.
For instance, the carelessly mentioned minimal price for a tonne of Belarusian potash fertilizers in line with estimates of the Belarusian Economy Ministry for 2014 has been heard by partners as an initiative of Belarusian Potash Company to reduce the price by $30-40 in 2014. “It runs contrary to our vision of the market,” said the executive. He also said he believes it is premature to voice specific figures concerning volumes of deliveries next year. “It is difficult to predict the situation at present. We understand what we are going to do but we are not ready to talk about actions of our partners and competitors. What is Uralkali going to do taking into account the latest news concerning the change of the owner? What are Canadian manufacturers and other ones going to do? Our plans for 2014 depend on those considerations, too. It is premature to talk about specific sale figures now. We will have to see how the situation on the market will pan out”.
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