Strikes and mass demonstrations in Belarus over the disputed presidential election were reported to have closed down much of the country’s potash production at the start of this week. But by late Aug. 19, state-owned producer Belaruskali said all seven of its mines were operating as usual, and the processing plants of the RU-2, RU-3, and RU-4 production units are also operating. The producer added that the RU-1 plant will restart operations after the completion of scheduled maintenance work.
However, according to an Interfax report on Aug. 20, citing the producer’s strike committee press secretary Gleb Sandras, while all ore directorates are continuing to work at Belaruskali, they are not working “to the full extent.” The strike committee is also discussing further actions, whether to continue the strike or not, and, if it is continued, in what form, according to the report.
According to a report by the Russian news agency Tass earlier in the week, there were said to be concerns that workers could be coerced into returning to work or their contracts would not be renewed.
“The situation is very uncertain and unclear now. We are making adjustments to our sales plan for August in online mode, and it is hard to say as of now how quickly the situation will get back to normal,” a spokesperson for Belarus Potash Co. (BPC), which handles Belarus’ potash exports, told Green Markets on Aug. 19. “I can only say that now we are focused on fulfilling our existing commitments.”
“At this point, it appears like this is a very short-term supply disruption, which could potentially be made up with inventory,” said Green Markets Research Director Alexis Maxwell. She said there are very strong incentives for any government to keep Belaruskali operating.
“The company is profitable, with an estimated cash cost of production at $50/mt. It also employs many people with good-paying jobs. Perhaps most importantly, Belarus’ economy can most aptly be described as a planned economy, and large state-run companies, like Belaruskali, are a major linchpin in the economy,” said Maxwell. “All of which are very strong reasons to keep operating, especially as prices rise in the short-term response.”
Belaruskali is the world’s second largest potash exporter, with 2020 production capacity at 13.2 million mt. The producer also anticipates at least 100,000 mt of saleable tons this year from commissioning of its greenfield Petrikov mine and plant (GM June 12, p. 27).
Belaruskali said late on Aug. 21 it has made its first shipment of potash from its new Petrikov potash operation in Belarus’ Gomel region. This first consignment of 28.64 mt was shipped in bulk in vehicles from storage facilities at the Petrikov plant, the Soligorsk-based producer said in a statement on its website. The customer for this first consignment was Polesie-Agroinvest Agricultural Unitary Enterprise in Petrikov.
Back in June, Belaruskali had anticipated completion of the commissioning of the Petrikov flotation plant by the second half of the month (GM June 12, p.27). The Petrikov plant will produce fine and granular potassium chloride.
Belarus exported 5.39 million mt of potash in the first six months of 2020, and some 5.61 million mt in the same year-ago period, according to Trade Data Monitor, citing the Belarus National Statistical Committee.
Most of Belarus’ potash is exported through the Lithuanian port of Klaipeda via the Biriu Kroviniu Terminalas terminal, in which Belaruskali has an ownership stake (last reported to be 30 percent (GM Oct. 11, 2019). It typically takes two days or less to deliver product from Belaruskali’s production sites to the port.
Political tensions in Belarus show no sign of easing as strikes continue and opposition protests snowball against the country’s incumbent president, Alexander Lukashenko, who has insisted he won’t resign or call a new vote.
Belarusian First Deputy Prime Minister Nikolai Snopkov has been appointed government representative to Belaruskali, according to an Interfax report on Aug. 21, citing the government press service. Appointing senior government members to joint stock companies with a government stake in them is reported to be standard governance practice in Belarus. The Belarus potash producer is 100 percent owned by the Belarusian state.
It was being reported late on Aug. 21 that Belaruskali miners who are currently on strike may be replaced with other workers, according to the country’s state-owned news agency, Belta, citing Lukashenko. He said these other workers could include workers from Ukraine, according to the report.