German potash producer K+S AG (FRA:SDF1) is cutting down production of the fertilizer ingredient by up to 300,000 tonnes before the end of the year as China’s ban on the commodity imports has worsened global market conditions.
“In the current weak market environment, which is further intensified by the continuing Chinese import bans on the standard potassium chloride product, adjusting production is a difficult decision, but the right one,” K+S executive, Alexa Hergenroether, said in the statement.
The company, with operations in the home country and in Canada, said the effect of the measure on its earnings before interest, taxes, depreciation and amortization (EBITDA) was expected to be about €80 million ($88m).
K+S AG is the latest company to react to market weaknesses. Larger Canadian rival Nutrien (TSX:NTR), created by the merger of Potash Corp. and Agrium, will also cut output by about 700,000 tonnes by taking production downtime at its Allan, Lanigan and Vanscoy mines, starting in November.
Belarus, one of the world’s largest potash exporters, warned earlier this month that it was planning to cut production of the crop nutrient by almost a third within the next three to four months due to weak global demand.
Russian producer Uralkali last week followed up with plans to scale back potash output by 350,000-500,000 tonnes.
In August, potash major Mosaic Co. said it would indefinitely shutter its Colonsay mine east of Saskatoon, resulting in around 350 layoffs.