A miner stands near the cutting face of a potash mine, owned by Russia’s Uralkali company, near the city of Berezniki in the Perm region close to Russia’s Ural mountains in this March 16, 2011 file photo. The breakup of the biggest player by volume in the global potash market, a Russian-Belarusian joint venture, sent a shock wave through shares of potash miners on July 30, 2013, on fears of falling prices for the key fertilizer mineral.SERGEI KARPUKHIN/Reuters
Canpotex Ltd. was set up in the early 1970s by the Saskatchewan government to avoid a trade war with the United States, which was worried New Mexico's producers would be driven out of business due to the lower potash prices stemming from new mines in Saskatchewan.
The idea was to establish an agency focused on potash exports outside of North America, and to set quotas for each of its member producers. This restricted supply and effectively kept prices up.
One of the goals of Canpotex was to encourage the use of potash fertilizer worldwide, and it played a key role in boosting exports of Canadian potash to China and other global markets. Over the years it also built its own shipping terminals and storage facilities, and it bought a fleet of 5,000 special train cars to handle the product.
Belarusian Potash Co. is much newer to the game. It was set up after the fall of the Soviet Union, when potash producers in Belarus and Russia turned their eyes to overseas markets.
BPC was established in 2005 to handle the exports from the two big producers, Uralkali and Belaruskali.
Both Canpotex and BPC say their main function is to promote exports of potash and to provide "stability" to markets. But they also influence prices by controlling the production and sale of about 70 per cent of the world's potash exports.
ABOUT BPC
Owners
Uralkali 50 per cent; Belaruskali 45 per cent; Belarusian Railways 5 per cent
Annual sales (2012) $5.6-billion (U.S.)
Sells mainly to: Brazil, India, China
Head office Minsk, Belarus
ABOUT CANPOTEX
Owners
One-third owned by each of Potash Corp., Agrium and Mosaic
2011 sales $4.5-billion
Sells mainly to: Australia, Brazil, China, India, Indonesia, Japan, South Korea and Malaysia
Head office Saskatoon