* Belarus is subject to Western sanctions
* Yara buys 10-15% of Belarus' potash output
* Potash is a major source of income for Belarus
* Banks and logistics providers halting services
OSLO, Jan 10 (Reuters) - Norwegian fertiliser maker Yara
said on Monday it will wind down purchases of potash
from Belarus by April 1 as international sanctions made it
impossible to continue the trade.
Yara estimates that it buys 10-15% of the annual output of
state-owned Belaruskali, one of the world's largest producers of
potassium salt, or potash, the crop nutrient that is a major
foreign currency earner for Belarus.
The company said its purchase of potash from Belarus had
been in full compliance with the sanctions but would still have
to come to a halt.
"Other parts of the supply chain are withdrawing essential
services required to enable potash exports from Belarus, as a
result of which Yara has initiated a wind-down in sourcing
activities," the company said in a statement.
This included logistical and financial services companies,
even where such services could be lawfully provided, a Yara
"It is these practical challenges stemming from the
sanctions, that have required us to evaluate alternative sources
of supply," the spokesperson said.
Western powers accuse Belarus' President Alexander
Lukashenko of rigging a 2020 presidential election and have
piled sanctions on his regime, including restrictions on potash
Exiled opposition leader Sviatlana Tsikhanouskaya has
repeatedly called on Yara to suspend its activity in Belarus,
and the company said in August it would consider the request.
Yara sources potash from nine suppliers globally, according
to a company sustainability report filed last year.
"As part of our risk management work we continue to map
alternative supply options to be able to respond to supply chain
disruptions," the company spokesperson said.
Beleruskali was Yara's single biggest potash supplier, the
Yara buys its potash from Belarus Potash Company (BPC),
Belaruskali's sales arm. The Norwegian firm said it will seek to
continue an industrial safety programme launched last year in
cooperation with trade union representatives.
BPC did not immediately reply to a Reuters request for
Global potash prices are set to rally after the United
States imposed sanctions on BPC, piling more pressure on farmers
and consumers already facing rocketing costs and a global
economy navigating rising food inflation, analysts and industry
sources told Reuters in December.
(Reporting by Terje Solsvik and Victoria Klesty in Oslo,
additional reporting by Polina Devitt in Moscow; editing by
Jason Neely, Robert Birsel and David Evans)