Potash prices fell to their lowest since 2010 as the buyers'
stand-off prompted by the shattering of the Belarusian Potash Company cartel,
and evident in weak North American demand date, hit home.
Potash prices, which had initially held firm in Vancouver
after the BPC break-up was announced in late July, fell by more than $20 a
tonne to some $380 a tonne last month, data from fertilizer giant PotashCorp
The decline reflected a fall-off in demand following BPC's
beak-up by Russia's Uralkali - a move which, in reducing industry pricing
discipline, prompted widespread expectations of a drop in values.
However, prices remained well above levels of $300 a tonne
or less than Uralkali said could be in the offing, although the group has since
rowed back on such a downbeat expectation.
The impact of the BPC break-up in demand was evident in both
domestic North American sales and exports, the PotashCorp data revealed.
Domestic sales were, at 662,000 tonnes, down 26% year on
year, in what is normally a seasonally strong period, as farmers undertake
Export sales fell 12.9% year on year to 399,000 tonnes - the
weakest September performance since 2001.
With North American potash production showing a seasonal
rise, after summer maintenance shutdowns, inventories rose 14.8% year on year to
Compared with August, stocks increased by 1.5%, ending a
trend of falling inventories stretching back to March.
The data highlighted the impact of the contagion within
fertilizer markets of the uncertainty created by the potash rumpus, with
phosphate and urea prices also extending declines.
Russia's Acron on Tuesday said that the urea market, also
weakened by strong Chinese exports, had shown signs of recovery this month, helped
by shutdowns of Ukrainian production capacity.
The fall-off in potash demand has prompted Canada-based PotashCorp
and Agrium to warn on profits, and US rival Mosaic to lower its forecast for
world shipments of the nutrient.