Background on Belarusian Potash

Potash
  • Potash refers to a group of potassium-rich minerals and chemicals. It is overwhelmingly used in fertilizer production, with agriculture accounting for approximately 95% of its applications.
  • The extraction of potash salts and their processing into fertilizers long played a critical role in the Belarusian economy. Through Belaruskali, a state-owned enterprise, Minsk provided 20% of global potash exports, generating significant revenues for the state budget. This sector served to enhance the prestige and prominence of the Republic of Belarus, with global leadership in production of a key commodity.
  • Over the past decade, the volume of fertilizer exports fluctuated between 5m and 7m tonnes annually, with their value ranging from $2bn to $3bn, representing up to 9% of Belarus’s total export revenues.

However, the profitability of Belarus’s potash sector has been in jeopardy since 2021, when it became subject to US and EU sanctions. This was exacerbated in early 2022, when Belaruskali lost access to the Lithuanian port of Klaipėda, which it had used for transshipment. Official government data indicate that Belarus’s share in the global potash market fell from 20% to just 9% in 2022. Although Minsk managed to maintain and even increase its sales to Beijing in 2023, this temporary expansion in the Chinese market does not signal a lasting recovery for Belarus’s potash industry. According to the Centre for Eastern Studies, “in the near future, as it struggles merely to survive, it is unlikely to recover the losses incurred due to sanctions”.