Update on 05 Aug 2013: Supposedly ~70% of the world potassium trade has been controlled by two export alliances, BPC in Russia and Canpotex in North America. The world price for potassium was kept at a “comfortable” ~$400/ton. Last summer a Russian potassium company, Uralkali, made a surprise exit from the BPC export alliance (BPC stands for Belarus Potash Company), and the potassium price then fell to ~$300/ton. The stock price of e.g. the K+S potassium and salts company in northern Hesse fell precipitously as well.
Update on 24 Oct 2013: Spiegel.de posted an amazing potassium follow-up: “A kingdom for a cartel. Lukaschenko’s battle with the oligarch.” After the Russian firm Uralkali abruptly ended their BPC cooperation with the Belarussian firm Belaruskali last summer, Belarussian Prime Minister Lukaschenko had Uralkali’s C.E.O., Wladislaw Baumgertner, arrested in Minsk, where he is still held by authorities though he was moved to house arrest in late September.
Since the split it’s been shown how dependent the White Russian state company was on its Russian partners: exports to India and China were considerable but have nearly ended because, White Russian sources said, Belaruskali’s sales personnel don’t have the English to keep their Indian and Chinese deliveries on Russian trains running? In addition to its dependence on Russian trains, White Russia remains dependent on Russian oil and gas. White Russian potassium mines have been experiencing temporary closures since the cartel ended. As the company’s revenues fall so do the state’s; Mr. Lukaschenko had been using the potassium company’s money to fill the government’s budget gaps.
Spiegel.de wrote that Uralkali and Belaruskali started working together in 2005 to help keep international potassium prices high, together controlling ~40% of the world market in 2012 for potassium salts, which are used to make artificial fertilizers. World potassium prices had peaks of as much as $900/ton, yet White Russia is now forced to try to attract nearby customers in Russia with prices around $140/ton, forcing the Russian competitor Uralkali to counteroffer $160/ton for domestic customers.
More historical background provided in the article: Uralkali is controlled by major shareholder Suleiman Kerimow (worth >$7 billion) who bought his interest from another oligarch in 2010. He was also interested in acquiring Belaruskali from Mr. Lukaschenko, who not only did not sell but announced that Mr. Kerimow had offered a purchase price of $10 billion to the government plus an additional $5-billion bribe to Mr. Lukaschenko. When the purchase offer was made is unclear from the Spiegel.de article but the nature of the gossip flying indicates it was before the BPC alliance ended.
(CAWL ee cawt ELL.)