Bright Prospects for Belaruskali
One of the world’s biggest producers of potash fertilizers is determined to expand production and launch new products
Mr Kiriyenko, 2011 is coming to an end. How do you evaluate the company’s performance this year?
We already see that 2011 was a good year for the company. According to our estimates, this year the production of muriate of potash (MOP) will rise to 8.8 million tonnes vs. 8.6 million tonnes in 2010. The export of potash fertilizers will also increase to exceed 7.5 million tonnes (6.8 million tonnes in 2010).
Belaruskali is among Belarus’ most lucrative assets. The company holds about 16% of the global potash market and sells potash fertilizers to 65 countries worldwide. Major investors from India, Russia and China are going to extraordinary lengths to get their hands on the company despite the hefty price of $30 billion. This year has been one of the most successful years for the company. Belaruskali has signed profitable supply contracts and extended its reach into new markets. The company has plans to increase the volume and variety of production. Valery KIRIYENKO, Belaruskali Director General, tells the Economy of Belarus Magazine about the company’s priorities, potash market trends and competition with Uralkali and the future Slavkali.
This will generate over $3 billion in foreign currency revenues, up 1.5 times over last year.
This year the company expanded into some new markets, including Australia, Barbados, Burkina Faso, Honduras, Cuba, Myanmar, Peru, Saudi Arabia, Surinam, Taiwan, Trinidad and Tobago, and Turkmenistan. The analysis of the medium-term and long-term development prospects of the potash market has revealed an increasing demand for potash chloride, espe- cially in Brazil, Russia, India, and China, provided there is no new financial turmoil in the global economy.
The increased output contributes to a better financial standing of the company. Our company earned Br3.1 trillion in profit in H1 2011, more than any other joint stock company in Belarus, according to the Finance Ministry.
The increase in profits, revenues, works and services translated into more tax revenues and payments into the budget. Belaruskali duly fulfills its tax obligations. In January-august 2011 taxes to be paid from revenues and profits rose by Br1.8 trillion, revenue taxes rose 2.1 times, profit taxes soared 3.6 times.
The company is implementing a large-scale investment program to upgrade, renovate and construct new production facilities. In January-september 2011, Belaruskali’s capital investments made Br1.8 trillion. The company channels investments into renovating the fixed assets which depreciation (Br10.5 trillion in balance-sheet value) reduced from 73.8% in 2005 to 55.2% on 1 September 2011.
Besides, the company is trying hard to cut down on imports.