Belarus Potash Co. (BPC) and Indian Potash Ltd. (IPL), India’s largest potash importer, have signed a new supply contract for the period Sept. 2018 until June 2019 at $290/mt CFR with 180 days’ credit. The news came Aug. 25. The price represents a $50/mt increase on last year’s contract agreed at $240/mt CFR. The Belarus supplier said the volumes agreed are comparable to those for the previous contract year, but did not disclose the volume.
BPC described the negotiations as “challenging and lengthy.”
“As both parties understand the importance of this contract not only for the Indian market but for the whole world potash market, BPC and IPL were able to reach a compromise,” the Belarus supplier said.
“The upward adjustment in the amount of $50 is fair and reflects the current market conditions and actual perspectives. The conclusion of this agreement will undoubtedly become a new positive driver for the mineral fertilizers industry,” said BPC.
Last year, Uralkali Trading was the first supplier to reach a contract deal with IPL. That came in late July, and came after the settlement of the annual seaborne supply contract price with China’s buying consortium.
Recent market talk on potential settlements in India – as well as on the China seaborne contract – had speculated a price increase of anywhere between a $40 and $70/mt on last year. Some sources had also speculated that perhaps only a $30/mt increase might be on the cards.