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CVR Partners, LP Message Board

  • jon2222b jon2222b Jul 30, 2013 10:05 AM Flag

    whoa, Russia screws Ferts big

    UAN getting beat after reducing divy now Russia screws all .... look for a low point to buy, too soon.

    Sentiment: Sell

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    • OAO Uralkali, the world's largest potash producer, sees global potash prices falling about 25 percent as it quits a trade venture and boosts shipments independently to countries including China.
      "We see the potash price may fall below $300 a ton after the change in our trading policy," Chief Executive Officer Vladislav Baumgertner told reporters today by phone.
      Uralkali's cooperation with Belarusian potash producer Belaruskali reached "a deadlock" after the government in Minsk canceled their joint trader's exclusive right to export the country's potash and Belaruskali made independent deliveries, Uralkali said in a statement. The Russian potash producer will switch exports to its own trader, Uralkali Trading, from the joint venture, Belarusian Potash Co., known as BPC.
      "Uralkali's announcement completely turns the global potash market upside down," Elena Sakhnova, a VTB Capital analyst in Moscow, said by phone. "If previously global potash producers were acting like an oligopoly, working with the rule that benefited higher potash prices over shipped volumes, now the market will be fully competitive. This will send down all potash companies shares, including Potash Corp. of Sasketchewan Inc. and Agrium Inc. (AGU)"
      Uralkali will benefit in the short term from increased sales volumes because it's the only potash producer in the world that can ship potash by rail to China, the ingredient's largest consumer, Sakhnova said.
      Shares Fall
      Filipp Gritskov, a BPC spokesman, declined to comment.
      Rail deliveries to China will reach as much a 2.5 million tons of potash annually, Baumgertner said.
      Uralkali shares fell 13 percent to 163.26 rubles at 11:31 a.m. in Moscow, their lowest level since November 2010. Israel Chemicals Ltd. (ICL) fell 10 percent to 31.98 shekels in Tel Aviv.
      Uralkali plans to run at full capacity after changing trading policy and will boost output to 13 million tons in 2014 from this year's 10.5 million tons, Baumgertner said.
      Uralkali will extend its first-half supply contract with China for the remainder of the year, meaning it will ship as much as 500,000 tons more potash to China by the end of the year, Baumgertner said. The price may be cut from the current $400 per ton, he said.
      China's current spot price of $350 a ton may "to some extent" be considered a target this year, he said.

      • 2 Replies to halfsure1
      • will our produce prices drop too ? My loaf of bread is like a gallon of gasoline...

      • not sure how potash pricing effects uan
        Potash turmoil 'a complete game changer'
        Credit Suisse calls the dismantling of one of the world's largest potash partnerships "a complete game changer," with share prices in the sector possibly cut in half. "Our guys are saying don't go anywhere near" the big fertilizer names; "we would not be bottom fishers here."JPMorgan is out defending the group, thinking Mosaic (MOS -21.4%) should be down $8 and Potash (POT -20.9%) down $5. A $50/ton drop in pricing would knock EPS by $0.75 for MOS and $0.40 for POT, far better than peers.IPI -29.5%, AGU -3.8%, UAN -2.5%, CF -0.2%

    • Please explain what Russia did to the fertilizer business?

 
UAN
20.57-0.07(-0.34%)Apr 17 4:04 PMEDT

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