* Uralkali says 2016 EBITDA down 38 pct to $1.2 bln
* Says committed to constructive relations with Belarus
* Says to refinance up to $1.4 bln of its debt in 2017
(Adds comment on relations with Belarus, context)
MOSCOW, March 13 Russia's Uralkali,
the world's largest potash producer, said its core earnings fell
38 percent in 2016 as prices of the crop nutrient tumbled and
sales volumes shrank.
Uralkali, along with other potash producers, has been hit by
strong competition and low prices for agricultural commodities,
but the company said on Monday that it expects total global
potash demand to rise by 1-2 million tonnes this year to 62
million to 63 million tonnes, driven by China.
Last year the world's top potash importers - India and China
- delayed signing new purchase contracts until the end of the
second quarter and start of the third quarter, putting downward
pressure on the global market.
"Softening of the key markets, along with a severe export
potash price decline resulted in a weaker performance in 2016,"
Uralkali said in a statement.
It reported core earnings, or EBITDA, of $1.2 billion for
2016, and said revenues fell 27 percent to $2.3 billion. Its net
profit, however, jumped to $1.4 billion from $184 million a year
earlier due to a foreign exchange gain and fair value
revaluation of swaps, the company said.
Uralkali forecast China would buy between 14.8 million and
15 million tonnes of potash this year while India would purchase
3.9 million–4.2 million tonnes.
Lower potash prices and carry-over stocks could lead to
higher demand for Chinese imports this year, Uralkali said.
Expectations for a good monsoon season and also low
carry-over stocks are expected to support India's import demand,
but India's potash subsidy reduction may be a challenge for
demand growth, it said.
Shares of Uralkali and its global peers rose last week after
Belarusian President Alexander Lukashenko said he was ready for
a mutually beneficial compromise in cooperation with Uralkali.
Uralkali quit a trading alliance with Belarusian potash
producer Belaruskali in 2013, intensifying competition in the
global market. Lukashenko has said several times since then that
he was ready to consider resuming cooperation.
"We have always been and remain committed to constructive
relations with Belarus and Belaruskali, but we have not been at
the meeting (with Lukashenko) and cannot comment on its
results," Uralkali's Chief Executive Dmitry Osipov told a
conference call for analysts.
Uralkali expects its 2017 capital expenditures to be flat at
around $320 million and plans to refinance up to $1.4 billion of
its debt, it told the call.
(Reporting by Polina Devitt; Editing by Louise Heavens and