03 October 2013 23:05 [Source: ICIS news]
HOUSTON (ICIS)--Uralkali produced 2.7m tonnes of potash in Q3 2013, which represents a 3.8% increase year on year, the Russian fertilizer producer announced on Thursday.
In Q3 2012, the amount of the crop nutrient was recorded at 2.6m tonnes. For the period of January through September 2013, the output was 7.2m tonnes, compared to 7.4m tonnes during the same nine-month period in 2012.
The company had previously said it had a target of 10.5m tonnes for the year. Despite switching its strategy to a volume-over-price approach, Uralkali may fall short of the yearly goal as the company has said its maximum quarterly capacity is only 3.24m tonnes.
In July, Uralkali broke away from its trading partnership Belarusian Potash Co (BPC) after the producer accused its BPC partner, Belaruskali, of selling product independently and destroying the fundamentals of the trading agreement. The decision sent the potash market into immediate turmoil and sent stocks of the various producers of the crop nutrient into a steep decline.
At the time of the announcement, Uralkali management had predicted the pricing for the crop nutrient could fall by as much as 25% when contract discussion begin later this year for spring applications.
Recently Uralkali’s acting CEO Viktor Belyakov said the company plans on having an additional 1m tonnes of capacity by the end of 2014.
Company officials expected that demand will continue to rise for the crop nutrient, with a potential for global consumption to reach as high as 54m tons (50m tonnes), which would eventually offset the current decline experienced with the dissolving of BPC.
In late September, the company said it was planning on reducing the price for potash by 12.5% in the fourth quarter but that the reduction in price would namely impact industrial producers of blended fertilizer products.
Uralkali officials on Thursday predicted that prices could keep falling through the end of the year, possibly even going into early 2014, but that it should see a definite rebound moving forward from that point.
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