* Uralkali's Q3 revenue down 19 pct, sees demand growth
* Says too early to comment on alliance with Belarus
* Says to cancel treasury shares in 2014
* Uralchem to close a deal with Uralkali stake this week
By Polina Devitt
MOSCOW, Dec 19 Russia's Uralkali, the
world's biggest potash producer, would consider new trading
joint ventures to replace a partnership it broke off with
Belarus, and does not rule out a revival of the venture with
Minsk, it said on Thursday.
The comments come after months of speculation that the
alliance with Belarus Potash Co. (BPC), which controlled 40
percent of the $20 billion global potash market, might be
Uralkali's key shareholders including billionaire Suleiman
Kerimov recently agreed to sell their stakes in Kremlin-blessed
deals, seen as paving the way to the creation of a new venture.
"Uralkali is potentially open to consider all the possible
potential partnerships which would be beneficial for our
shareholders," chief financial officer Viktor Belyakov said.
"As to BPC and Russia in particular, it is too early to
comment on any potential partnership and its form," he said.
Uralkali also said it was increasing output and saw signs of
demand improving next year thanks to demand from emerging
markets and low-income farmers.
Global prices for potash, a crop nutrient, have declined
since 2012 due to oversupply. Uralkali triggered a further
decline when it quit the sales alliance with Belarus in July,
seeking instead to maximise sales volumes.
Since Uralkali left the alliance, falling potash prices have
hit Belarus's export earnings and infuriated the former Soviet
nation's president, Alexander Lukashenko. Lukashenko has called
for a restoration of the venture, but experts say industry
overcapacity may make this hard to achieve.
Uralkali plans to boost 2014 potash production by 20
percent, year-on-year, to not less than 12 million tonnes,
The company also sees 2014 global potash demand growth at
around 10 percent thanks to revived demand from price-sensitive
farmers, it said.
"As potash became more affordable for lower-income farmers,
and inventories are depleting, we see that demand is gradually
recovering," Uralkali sales chief Oleg Petrov said.
Uralkali sees global potash demand rising to between 58
million and 60 million tonnes in 2014 thanks to growing
consumption in China, India, Brazil and Southeast Asia, up from
53-54 million tonnes in 2013.
Its average third-quarter export price decreased by 27
percent, year-on-year, to $272 per tonne on a free-carrier (FCA)
basis, which excludes delivery costs. Revenue fell 19 percent to
$856 million, supported by increased sales volumes.
In November the main shareholder in Uralkali, Kerimov,
agreed to sell a 21.75 percent stake to Russian
tycoon-turned-politician Mikhail Prokhorov, while Belarus-born
businessman Dmitry Mazepin's fertiliser firm Uralchem agreed to
buy a further 20 percent.
Uralchem plans to close the deal by the end of this week,
its spokesman Alan Basiev said on Thursday.
Uralkali holds around 12 percent of its shares in treasury,
which are expected to be cancelled in 2014, according to
Belyakov, increasing stakes of remaining shareholders.
Uralkali shares were up 1 percent in Moscow on Thursday,
outperforming broader market.