August 28, 2013 / 12:30 PM / 5 years ago

Chile fertilizer company SQM posts 2nd qtr profit tumble, cuts capex

SANTIAGO, Aug 28 (Reuters) - SQM , the Chilean fertilizer, iodine and lithium producer, reported sharply lower quarterly profit on weakness in many of its operations, and said it was scaling back 2013 capital expenditures.

SQM’s second-quarter net profit slid 44.1 percent from a year ago to $107.4 million, the company said late Tuesday night.

SQM, which had under 3 percent of global potassium chloride sales in 2012, is bracing for lower prices for the key crop nutrient after the dismantling of one of the world’s two big potash cartels.

The $20-billion global potash market was rocked in July, when Russia’s Uralkali quit the Belarusian Potash Co (BPC), a move that could cut the global potash price to below $300 per tonne in the second half of 2013.

Since the announcement, SQM’s shares have shed about 30 percent.

SQM said it was reducing planned capital expenditures for this year to roughly $400 million from a previous $500 million estimate. The company added that it anticipated 2014 spending would be “significantly below” this year’s level.

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