Belarusian Potash Company (BPC, joint venture trader of Uralkali and Belaruskali, and the world leader in the export sales of potash fertilizer) has informed Uralkali about its decision to revise the price for granular potash for the Brazilian market.

The move is expected to help restore the supply-demand balance in the potash market. The new prices for Brazilian customers, effective for deliveries from March to May 2009, have been set at USD $750 per tonne of potash for large importers and USD $765 per tonne for small importers. BPC’s previous prices were set at USD $1000 and USD $1010 respectively and were effective from 1 July 2008.  The new prices will apply to all BPC shipments to the Brazilian market starting from March 2009.

Brazil is one of the world’s largest markets of potash fertilizers. The country’s consumption of potash was approximately 6.5 million tonnes in 2008, according to fertilizer consultancy Fertecon. Brazil is a spot market, in which the shipments are made immediately following consumer orders, rather than under long-term contracts (as is the case with the bulk of Indian and Chinese markets).

BPC’s decision to revise the prices for Brazilian importers is based on a thorough analysis of the local and global potash fertilizer market and agricultural industry. The Brazilian economy has been adversely affected by the global economic downturn, with prices for its main crops  (soybeans, corn, etc.) falling. This price drop has caused a decline in farmers’ capacity to purchase and use mineral fertilizer and resulted in softened demand for it. BPC believes that the new prices for the Brazilian market will help ensure the best supply-demand ratio and facilitate the recovery of potash fertilizer consumption in Brazil to the pre-economic crisis level.