Q3 multi-component ferts demand hit by potash market disruption: bank

06 November 2013 13:50  [Source: ICIS news]

LONDON (ICIS)--Third-quarter multi-component fertilizer demand has been capped by market expectations of price cuts following the potash market disruption caused by the end of the Uralkali-Belaruskali trading cartel, a bank said on Wednesday.

Poland's Zaklady Chemiczne Police (ZChP) – a subsidiary of European fertilizer producer Grupa Azoty – is one European multi-component fertilizer company clearly feeling the effects of the potash dispute fallout, Czech Republic-based investment bank WOOD & Company added.

“We expect to see continued margin pressure in ZChP's third-quarter multi-component fertilizer earnings, with commodity DAP [diammonium phosphate] spreads down 64% year on year in Q3 and NPK [nitrogen phosphorus potassium] down 14% year on year,” said Piotr Diozd, a chemical industry analyst at the bank.

The lower margins would be a key factor in driving ZChP's third-quarter net profit down 50% year on year to approximately Zl 14.4m ($4.6m, €3.4m), WOOD & Company estimated.

At the end of July, Russia's Uralkali broke away from trading partnership Belarusian Potash Co (BPC) – which controlled more than 40% of global potash exports – after accusing its BPC partner, Belaruskali, of selling product independently and destroying the fundamentals of the trading agreement.

Subsequently, in October, North America's 39-year-old Phosphate Chemicals Export Association (PhosChem) was disbanded.

($1 = €0.74,
$1 = Zl 3.11, €1 = Zl 4.18)


By: Will Conroy
+44 20 8652 3214



AddThis Social Bookmark Button

For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.

Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.

Printer Friendly

ICIS news FREE TRIAL
Get access to breaking chemical news as it happens.
ICIS Global Petrochemical Index (IPEX)
ICIS Global Petrochemical Index (IPEX). Download the free tabular data and a chart of the historical index

Related Articles