The fertiliser industry has been thrown into turmoil as the Russian company Uralkali pulled out of the world’s largest potash cartel.
It said it was breaking with its Belarussian partner Belaruskali because they had “undermined sales agreements” which had limited production underpinned prices.
There had been rumours that both were selling potash outside the partnership; both denied that.
Shares of companies that produce potash, which is a key fertiliser ingredient, slumped.
Uralkali shares plunged as much as 25 percent, falling so fast that the Moscow stock exchange suspended trading in the stock for a while. They finished down almost 19 percent.
Industry experts said global potash prices are now likely to plummet by around 25 percent. The could mean better deals for farmers and ultimately consumers.
One trader compared it to Saudi Arabia deciding to leave OPEC which would cause an immediate fall in oil prices.
The shock move – which leaves North America’s Canpotex as the dominant potash export venture – could also lead to cancellations of projects by rivals as the industry weighs the effect of lower prices.
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