Potash secrets or How Belarus trades fertilizers with China
Recently, some details have become known about the work of Belaruskali. That includes how things are going with the supply of fertilizers to the Chinese market.
Belaruskali rebuilds logistics
At the end of March, the head of the Presidential Administration, visited Soligorsk. Igor Sergeenko commented on the current situation in the potash industry. The head did not say anything specific about the state of exports. He noticed that the situation is not easy, but solutions are being sought and the company is working.
He stressed that he would have to work more with China and the Russian Federation.
«Yes, in the conditions of sanctions, we have to rebuild logistics and work with other partners. The problem for us is the transportation of products through the Baltic ports. Transportation through Ukraine is impossible. The head of the Administration said to work with China and more with Russia».
The CEO said that they «take into account the sanctions during the work. They affect both for the Republic of Belarus and the enterprise».
Instead of the sea — on rails
Ivan Golovaty also raised the issue of the supply of Belarusian fertilizers to China by rail. And here there is something to speculate about.
«Today we have mastered the shipment of potash fertilizers by container train. We have been working since December 2021. The number of trains increases every month». On March 30 Golovaty said in the near plans is to increase and send at least three container trains to China.
Тransportation of fertilizers to China was not by sea, but by rail.
At the same time, it leaves more questions than answers.
The previous potash contract with China ended in December last year. They expected that to sign a new contract in late 2021 or early 2022. Although until recently there was no official information about this. Now it turns out that Belarusian fertilizers are already being supplied to China. But the question immediately arises: when did the deliveries start?
Lets turn once again to the words of the CEO of Belaruskali: «In particular, we have mastered the work on the shipment of potash fertilizers by container trains».We have been working since December 2021.
At the end of March, the shipment of potassium by rail has already taken place. It is not completely clear what Ivan Golovaty meant when he spoke about December 2021.
You can interpret his words in different ways. The first option is that they are doing the work on the fact. That is, starting from December 2021. It is possible that they transported trial batches of potassium to the Celestial Empire. The second interpretation is that preparatory work has been underway since December 2021. For example, price coordination, building logistics, etc.
It is unlikely that China receives Belarusian potassium since December. The worlds leading media would have already written about such a situation.
Although, the negotiations between Belarus and China could be in a high-security regime. The Ambassador Extraordinary and Plenipotentiary of Belarus to China also spoke about it. The ambassador said that «Belarus and China have signed a potash contract».
Everything new is well-forgotten old
Belarus announced the reorientation of potash flows to Russian ports. Also, Belarus will build its own port near St. Petersburg. The plan of transportation of fertilizers through Ukraine did not work.
There are no more optimistic expectations. The terminal capacities of Russian ports are still not enough. That is why Belarus cannot decide to transport potash to China by rail. But rail deliveries are more expensive than sea ones.
The idea of The transportation of potash fertilizers to China by rail itself is not new.
In 2010, BELZHD with the Austrian company Far East Land Bridge Ltd. developed a logistics scheme. It was for the delivery of Belarusian potash fertilizers to China. In 2014, Belarus returned to this issue again, but it did not bring results.
It was more profitable for Belarus to continue shipping through the Klaipeda port.The Academic director of BEROC (Kiev), said about it at the beginning of 2022. Bornukova noted that this will lead to a significant increase in transport costs.
The Deputy Head of the Economic Department is agree. High potassium prices will be able to compensate for the costs.
«Prices for producers are now quite comfortable and high. Belaruskali is one of the key suppliers to world markets. The margin that Belaruskali has now allows you to pay even for expensive logistics.The container trains will deliver potash fertilizers to China. We need special railway platforms and the containers». That is what the CEO of Belaruskali said.
The other day Belaruskali announced an increase in the capacity for packing fertilizers. It seems that the company is betting on the development of container exports. Moreover, they plan the delivery of products not only to China. To India
also.
Potash Secrets
If we signed the potash contract with China, then why are its terms not disclosed? The answer lies on the surface. It is all about Western sanctions against the Belarusian potash industry. Why once again draw attention to a product that is already under close control?
Before, Belaruskali, after concluding an agreement with China, always issued a press release. There were also indicated contract prices for fertilizers.
In April 2020, the Belarusian Potash Company signed a contract for the supply of potash to China. The price was $ 220 per ton. In February 2021, Belarus and China agreed to set a contract price of $247 per ton.
Now there is no such information on the Belaruskali website. The website of the Belarusian Potash Company is not available at all.
Also, Belstat no longer displays statistics on fertilizers in open access. There was the decree on export which regulates the export of potassium. The publication was only for official use.
In a word, solid secrets and secrets. But, as you know, everything secret sooner or later becomes clear.
Leave a comment