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ICL signs 3-year potash deal with China
Jan. 22, 2013
Israel Chemicals Ltd. a multinational fertilizer and specialty chemicals company, announced that it has signed framework agreements to supply its customers in China with an aggregate 3.3 million metric tons of potash over the next three years. According to the terms of the agreements, the potash selling price for each semester will be set in line with prevailing market prices and arrangements in China.
Under the framework of these agreements, ICL Fertilizers has committed to deliver 660,000 metric tons of potash during the first half of 2013. The selling price of these quantities will be in line with recent deals completed by other potash suppliers to the Chinese market.
Although ICL Fertilizers operates potash mines in Spain and England, the majority of the potash that ICL sells to China is produced from Israel's Dead Sea and exported through the Israel's Red Sea Port of Eilat. This gives ICL Fertilizers a logistical advantage for shipping potash to Southeast Asia as compared to most of its competitors.
In 2010, ICL Fertilizers adopted a new sales and marketing strategy for its activities in China, according to which it began selling directly to fertilizer producers and distributors. As a result, ICL Fertilizers has succeeded in increasing the number of its customers in China and expanded the basket of products that it sells to the Chinese market, as demonstrated by the 2013-2015 framework agreements.
Commenting on the news, Mr. Dani Chen, CEO of ICL Fertilizers, said, "The scope of these multi-year framework agreements with our customers in China demonstrates once again China's need for significant quantities of potash to feed its huge and rapidly-growing population. ICL is proud to play a vital role in the global agriculture market, helping to increase the food supplies available for China and the world at large.
"The milestone accomplishments of these agreements, including our growing customer base in the Chinese market, our expanding basket of potash products sold in significant quantities and the multi-year terms of the contracts, all demonstrate our successful strategy aimed at reinforcing and deepening our positioning in the Chinese market. We are grateful for the trust that our Chinese customers have granted us and pledge to continue being an efficient, responsive, creative and trustworthy supplier in order to continue strengthening our relationships in the future."
Source: Market Watch
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