REFILE-China, India gain upper hand as potash cartel crumbles

Wed Jul 31, 2013 9:24am EDT
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* Price for the crop nutrient could fall 25 percent this year

* India imports all its potash, China around half

* Both buyers had dug their heels in over high prices

By Rajendra Jadhav and Lucy Hornby

MUMBAI/BEIJING, July 31 (Reuters) - Agriculture in China and India will be the biggest winner after Russia's Uralkali walked away from one of the world's two big potash cartels, paving the way for consumers to demand hefty price cuts.

The two Asian countries account for around 30 percent of global demand for crop nutrient potash, and had been forced to swallow high prices for a decade in a market dominated by Uralkali's Belarus Potash Company (BPC) and Canpotex, a North American producer group.

Uralkali ended its joint venture with Belaruskali on Tuesday, citing a deadlock over sales and said it would export via its Swiss-based unit.

Chinese state-owned trading companies held urgent meetings on Wednesday to discuss the break-up, which comes just ahead of this year's contract negotiations expected in the next month.   Continued...