UPDATE 2-Potash market turmoil prompts K+S to cut costs

Thu Nov 14, 2013 4:17am EST
 
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* Says unclear how long potash demand will remain tepid

* Now sees year operating profit down by up to 25 pct to over 600 mln euros

* Q3 EBIT I down 26 pct at 116 mln euros vs analysts' forecast of 107 mln

* Share price rises

FRANKFURT, Nov 14 (Reuters) - German potash maker K+S announced plans on Thursday to cut costs by 500 million euros ($670 million) over the next three years following the collapse of one of the world's two big cartels selling the fertiliser.

Russia's Uralkali, the world's largest potash producer, sent shockwaves through the industry in July by pulling out of its sales alliance with its neighbour Belaruskali, triggering a decline in global potash prices.

"It was and is obvious that the announcement (by Uralkali) caused tangible purchasing restraint on the customers' side," K+S said in publishing quarterly results, adding it was difficult to assess how long the uncertainty would last.

Farmers and potash import organisations across the globe have held off on orders in anticipation of a further drop in prices.   Continued...