MOSCOW, Dec 20 (Reuters) - Russian potash producer Uralkali forecast a rebound in demand for the soil nutrient next year, saying farmers will have an incentive to invest after benefiting from higher crop prices in 2012, when drought slashed crop output.
It expected global potash deliveries this year to total 48 million to 49 million tonnes, down around 13 percent from last year’s record levels due to significant stocks, economic volatility and unfavourable weather conditions in many regions of the world.
“We hope that the positive crop dynamics that we are observing now will provide for a significant rebound in potash demand next year,” Uralkali Chief Executive Vladislav Baumgertner said.
Uralkali, controlled by businessman Suleiman Kerimov, is the world’s largest potash miner by output and the second-biggest producer by capacity behind Canada’s Potash Corp of Saskatchewan Inc.
Its revenue in the third-quarter of this year fell 12 percent to $1.06 billion, the company said. For the nine months, revenue was 4 percent higher at $3.29 billion.
Uralkali has previously forecast that global demand would rise to 54 million tonnes in 2013.
Drought this year hurt crops in the United States, Russia and the Black Sea region and other parts of the world, sending grain inventories lower and prices up.
Uralkali said early in December it would cut potash output by half to 2 million tonnes in the December to March period to reduce excess global supply during a protracted fall in demand.
China and India halted contract purchases of the crop nutrient in the second half of the year and are expected to contract lower volumes next year, making for a slow start to 2013.
Uralkali said the poor monsoon in India created increasing cautiousness among farmers about purchasing fertilisers, but that demand there should return to a previous peak level of 6.5 million tonnes after 2014.
In China, local demand is low due partly due to signs of an economic slowdown in the country. Uralkali expects to begin re-negotiating a new contract with China in February.