The head of OAO Uralkali (URKA), the potash producer whose split from a Belarusian venture sent the industry reeling last year, met his counterpart at Belarusian Potash Co. last week in a first step to renewing ties.
Uralkali Chief Executive Officer Dmitry Osipov held a meeting with Elena Kudryavets, CEO of BPC, in Moscow on Jan. 31, Irina Savchenko, a spokeswoman for the Belarus company, said today by phone. They discussed “current issues of cooperation not related to the market,” she said, declining to elaborate.
Uralkali’s exit from the trading alliance in July, amid accusations that partner Belaruskali had sold cargoes outside their trading accord, sent stock prices plummeting in the $20 billion global potash market. Belarus arrested Uralkali’s then-CEO Vladislav Baumgertner and called for a change of ownership at the company before a return to cooperation could be studied.
The meeting is a first step toward discussing restoring a venture, said Konstantin Yuminov, a Raiffeisenbank analyst.
“There’s no need to rush for either party, especially as Uralkali signed a deal with China and Belarus is supposed to get a China deal too,” he said. “Agreement may take some time.”
Uralkali, which will sell 700,000 metric tons of potash to Chinese customers at $305 a ton under a contract for the first half, rose 1.7 percent to 173.24 rubles by 5:39 p.m. in Moscow. News of the meeting pushed other potash stocks higher. Israel Chemicals Ltd. (ICL) gained as much as 2.9 percent in Tel Aviv, while K+S AG (SDF) also climbed 2.9 percent in Frankfurt.
The Russian producer, which had a 51 percent share of sales volumes before the separation, will push for a larger proportion in any talks as it has 13 million tons of annual capacity, while Belarus has 10 million tons, three people with knowledge of the matter said. Uralkali will only consider restoring ties if the partnership is registered outside Belarus, they said, asking not to be identified because the information is confidential.
Uralkali’s press service declined to comment when contacted by Bloomberg. Olga Dolgaya, a spokeswoman for the Belarusian government, said she couldn’t comment on any Uralkali proposal.
To contact the editor responsible for this story: John Viljoen at email@example.com