Salt_RU

1

Russia

2

Russia: Overview of Supply & Demand

• Russia is the major salt market in the region.

• The domestic production covers about 85% of the consumption.

• The remainder is covered by import supplies from neighboring countries – principally Ukraine and Belarus.

Salt Supply and Demand for RU - 2006 (in kt)

7315

1280

35

8560

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

Production Import Export ApparentConsumption

3

Russia: Supply - Producers

• Russia has significant salt mining activities, the major domestic suppliers in Russia are:

Major Suppliers of NaCl in Russia - 2006

Company Location Salt Origin Salt Type Remarks

Producers

BassolNizhniy Baskunchak

RU Lake salt Primary producer

Iletsksol Orenburg RU Rock salt Primary producer

Kaustik Volvograd

Volvograd RU Brine Primary producer

Sayanskchim-prom

Sayansk RU Brine Primary producer

SibsolUsolie-Sibirskoe

RU Brine salt Primary producer

Silvinit Solikamsk RU Rock salt Primary producer

4

Russia: Supply – Producers (Continued)

• The major domestic suppliers in Russia are (continued):


Company Location Salt Origin Salt Type Remarks

Producers

Soda Sterlitamak

Sterlitamak RU Brine Primary producer

Tirestkiy Solerudnik

Tiret RU Rock salt Primary producer

5

Russia: Supply - Traders

• Trading and distribution play a major role in the salt supply to the domestic market in Russia. The major salt traders are:


Company Location Salt Origin

Traders

Eurosalt St. Petersburg NL: Akzo

Eurotrust Expo Moskva BY: Mozyrsalt, UA: Artemsalt, Slavyansksalt

Khimpromtorg Berezniki RU

Mineral Trading Moskva RU: Silvinit

Polisol Soledar UA: Artemsalt

Sevzapregionsol SPB

St. Petersburg Imported salt

Solinvest Nizhniy Novgorod BY: Mozyrsalt, RU: Silvinit

6

Russia: Supply Continued - Traders

• Major salt traders (continued):


Company Location Salt Origin

Traders

Sol Regiona Samara RU

Sol Zemli Moskva RU

TD Sobr Bryansk RU

TD Sol Moskva BY: Mozyrsalt, UA: Artemsalt, Slavyansksalt

TD Soldo Irkutsk RU: Sibsol, Tiretskiy Solorudnik

TD Sol Chernozemlya

Voronezh UA: Artemsalt

7

Russia: Salt Production

PRODUCERS - Overview

• On the merchant market there are four major Russian salt producers, which are private companies. The companies are

• Bassol

• Iletsksol

• Silvinit

• Uralkaliy (which appears to have suspended its salt production)

• In addition, there are state owned salt companies in Siberia:

• Tiretskiy Solerudnki

• Sibsol (said to be under the process of bankruptcy)

• Mikhailovskiy Zavod Khimreaktivov.

8


PRODUCERS - Overview

• There are three major brine salt producers, two of them on the territory of the European Russia and one in Siberia:

• Soda Sterlitamak (Yar-Bishkadag huge salt deposits in Bashkirtostan)

• Kaustik Volgograd (salt deposits in the region of Volgograd)

• In Siberia Sayanskkhimprom (the Usolye-Sibirskoe salt deposit as well as the Kempenday salt deposits)

• These three brine salt producers (solution mining) do not appear on the merchant market. There are producing brine salt, rock salt and lake sediment salts in the Russian federation.

9


BASSOL

• Bassol at Nizhniy Baskunchak is the largest merchant market salt producer in the Russian Federation. The salt production is carried out by harvesting lake sediment salts on the salt lakes Baskuchak and Elton in spring and summer. Prior to 1990 the annual production varied about 5’500-6’000 ktpa, then it has settled on the level of about 1’500 ktpa.

• Bassol’s historical salt production is shown in the table below (ktpa):

1997 1998 1999 2000 2001 2002

925 1’036 1’750 1’790 1’420 1’670

10


BASSOL

• Bassol produces bulk salt suitable for human consumption: about 50-55 ktpa of packaged salt suitable for human consumption and technical-industrial salt for various industrial uses.

• For Bassol, the main transportation routes are railway, road and also the Volga and Akhtuba Rivers waterways - near the estuary there is a distance in which the Volga runs parallel with the Akhtuba.

• Typical geographical sales of Bassol in percentages of weight are given below:

Tsentralniy rayon 52%

Privolzhskiy rayon 17%

Yuzhniy rayon 20%

Severozapadniy rayon 9%

Siberia and export 2%

TOTAL 1’450 kt

11


BASSOL

• Bassol is believed to supply with salt raw material a number of Russian chloralkali plants in the European part of the country.

• Its salt reaches as far as to the Kaprolaktam Dzerzhinsk chloralkali plant, furthermore to Azot Novomoskovsk and Khimprom Cheboksari.

• Some quantities of Bassol salt may even reach the remote paper and pulp industry located at Karelia (this is located in the Severozapadniy rayon).

12


ILETSKSOL

• Iletsksol located near Orenburg and produces rock salt by mining.

• The company’s annual salt production capacity is about 600 kt, which is to be expanded to 1’200 ktpa (planned for 2008).

• At present Iletsksol produces about 520 kt of salt (about 70-80% of this is salt suitable for human consumption and the rest of 20-30% is technical-industrial salt).

• Major consumers are the food industry, retail market through the trading house called TD Iletsksol,the fishing sector, etc.

• From amongst the industrial sectors the gas and crude producer Surgutneftegaz is the major client.

• The company is the only salt exporter in the Russian Federation exporting some quantities of salt first of all to Kazakhstan (it is situated very close to the Russian-Kazakh border but also to Azerbaijan and Uzbekistan).

• It is expected that the market share of Iletsksol will increase after the completion of the capacity expansion.

13


SILVINIT

• Silvinit is located at Solikamsk and its core business is the production of potassium salts and fertilizers.

• Salt is produced by the company as byproduct. Silvinit produces salt suitable for human consumption, fodder salt, so called Kama salt for the oil and gas industry, as well as water treatment also for the paper and pulp industry, and lower grade salts for road deicing.

• Typically Silvinit produces about 280 kt of Kama salt for the oil and gas industry as well as for various water treatment applications, and about 320 kt of rock salt also used for chemical transformation.

• Silvinit supplies salt raw material to the Kirovo-Chepetskiy Khimzavod chloralkali plant. Due to the temporary outage in Uralkaliy Berezniki salt production, Silvinit become the main supplier of salt for the Soda Berezniki soda ash plant.

14


SILVINIT

• The company has the relatively most favorable position with respect to the the pulp and paper industry plants located in the Karelia region (in the neighborhood of Finland). This includes the major pulp producers at Arkhangelsk, Novodvinsk, Segezha and Kondopoga. In comparison this is roughly the same distance as the distance between Moskva and the Ural mountains.

• By comparison, the distances between the region of Karelia, where the above mentioned paper and pulp plants annually producing about 1’000kt to 1’200kt of pulp are located, and the other big salt producers for the merchant salt market are unusually long ones.

15


URALKALIY

• Uralkaliy is located at Berezniki (near to Silivinit Solikamsk) and its core business is the production of potassium salts and fertilizers.

• As by-product Uralkaliy recovers rock salt as well.

• In 2003 the production of rock salt was 650 kt. However, after an incident in the salt producing mine in 2004 the production has not been restarted.

• Until 2003 Uralkaliy had been the main supplier of salt to the Soda Berezniki soda ash plant.

16


SODA STERLITAMAK

• Soda Sterlitamak is the largest brine salt producer in the Russian Federation.

• Its Yar-Bishkadag deposit in the Sterlitamak-Salavat region is virtually inexhaustible.

• The solution mining is carried out in the depth of ca. 1’300 m.

• In agreement with the proposed Soda Sterlitamak development strategy, which targets the annual production of soda ash ca. 2’000 ktpa (an increase of ca. 800 kt compared to the 2006 production level) the company plans to reconstruct its brine fields and open further seven brine wells.

• Soda produces brine for captive use as well as it sells to Kaustik Sterlitamak chloralkali plant and to the small Ufachimprom chloralkali plant.

• Soda is not considered as a merchant market producer.

• This brine salt is used exclusively for chemical transformation.

17


KAUSTIK VOLGOGRAD

• Kaustik Volgograd is a major producer of brine salt for captive use as raw material for the production of caustic soda as well as for the neighboring Chimprom Volgograd (also for caustic soda production).

• Following the break-up of the old economic system, the so called “brine processing plant” was acquired by Kaustik, thus the company become the monopoly supplier of salt (as brine) to Chimprom Volgograd.

• The estimated salt reserves of the deposit, which is called the Svetloyarsk salt deposit, is about 1’100 million metric tons.

• Kaustik was granted a permit until 2013 to extract this salt to an annual maximum volume of 2’000 thousand cubic meters of brine.

• Approximate annual production of brine is about 1’500 thousand cubic meters.

18


OTHER PRODUCERS

• The other merchant market salt producers Tiretskiy Solerudnik as well as Sibsol and Mikhailovskiy Zavod Khimreaktivov produce together about 660 ktpa for the merchant market.

• The third non-merchant market brine producer Sayanskchimprom is located in Siberia.

19


• The recent development of the salt production in Russia is given in the following:

Production of Primary NaCl in Russia – in ktCompany 2003 2004 2005 2006

Rock Salt

Iletsksol 470 470 520 520

Silvinit 700 720 640 640

Tiretskiy Solerudnik 330 400 400 450

Uralkaliy 650 0 0 0

Others 100 120 200 255

Total Rock Salt 2250 1710 1760 1865

Brine Salt

Kaustik Volgograd 420 440 470 500

Sayanskchimprom 266 280 325 345

Sibsol 50 45 40 na

Soda Sterlitamak 2500 2730 2850 3155

Total Brine Salt 3236 3495 3685 4000

20


Production of Primary NaCl in Russia – in kt

Company 2003 2004 2005 2006

Lake Sediment

Bassol 1400 1530 1420 1450

Total, Lake Sediment 1400 1530 1420 1450

TOTAL SALT 6886 6735 6865 7315

• The recent development of the salt production in Russia is given in the following (continued):

21

Russia: Major Salt Producers

• The major salt suppliers in Russia are shown in the following:

Major Salt Producers in Russia

CompanyHeadquarters

LocationMain Activities Remarks

Bassol Nizhniy Baskunchak

Seasonal lake salt harvesting

Iletsksol Orenburg Salt mining 80% foodgrade, 20% technical

Kaustik Volgograd

Volgograd Captive supplierExclusive supply for Chimprom Volgograd

Sayanskchim-prom

Sayansk Captive supplier

Sibsol Usolie-SibirskoeSalt mining (brine evaporation)

Brine salt

Silvinit Solikamsk Potash salts mining (NaCl byproduct)

45% foodgrade salt, 55%technical

22

Russia: Major Salt Producers

• The major salt suppliers in Russia are shown in the following (continued):

Major Salt Producers in Russia

CompanyHeadquarters

LocationMain Activities Remarks

Soda Sterlitamak

Sterlitamak Soda ash Brine salt

Tiretskiy Solerudnik

Tiretsk Salt mining Rock salt

Uralkaliy BereznikiPotash salts mining (NaCl byproduct)

Rock salt – may be idle

23

Russia (Western Part): Main Producers & Users

IletsksolOrenburg

Kaustik Volgograd *) Volgograd

BassolNizhniy Baskunchak

Azot Novomoskovsk

Kaustik SterlitamakSterlitamak

KaprolaktamNizhniy Novgorod

Chimprom Volgograd Volgograd

UralkaliyBerezniki

UfachimpromUfa

Russkaya Sodovaya KompaniaBerezniki

SilvinitSolikamsk

Soda Sterlitamak *)Sterlitamak

Salt Producers

Salt Users for CT

Paper & Pulp Industry

OAO KondopogaKondopoga

OAOSegezhaSegezha

OAO Kotlasskiy CBK KorazhmaKotlas

Mondi Business PaperSitikvar near Novoclvinsk

OAO Arkhangelskiy CBKNovodvinsk

Solikamsk Paper and Pulp Co.Solikamsk

Kirovo-Chepetskiy Khimzavod

Kirov

Chimprom Cheboksari Cheboksari

*) Captive Salt

24

Russia (Siberia): Main Producers & Users

Salt Producers

Salt Users for CT

Paper & Pulp Industry

UsoliechimpromUsolie

Ust’ilimsk LPKUst’ilimsk

Tiretskiy SolerudnikiTiret

Sayanskchimprom *)Sayansk

SibsolUsolie-Sibirskoe

Bratsk KomplexBratsk

ChimpromKemerovo

*) Captive Salt

25

Russia: Ownership of Main Salt Producers & Players

Ownership of the Major Salt Producers In Russia

Company Ownership/Comments

Bassol Investment company Olma Moskva 30,5%, the rest private persons

Iletsksol Orbis Kapital 46,6%, Credit Prive SA 31,1%, other 22,3%

Kaustik Volvograd Part of Nikochem group – supply to Plastcard, a major PVC producer

SayanskchimpromOwner is the Renova Group – Group has membrane electrolysis and produces PVC

Sibsol State owned

Silvinit Investment company Financial House 25,08%, Hustell Trading Ltd 17,07, IBH Beteiligungs- und Handelges mbH 13,35%, Royalpart SA 13,34%, JSC Akron 8,10%, Eventus AG 6,35%, Bilarex Co Ltd 5,11%

• The major salt suppliers in Russia are shown in the following table:

26

Russia: Ownership of Main Salt Producers & Players

Ownership of the Major Salt Producers In Russia

Company Ownership/Comments

Soda SterlitamakDepozitarnaya Kliringovaya Kompania 8,22%, Ministerstvo Imushestvennych Otnoshenniy RB 61,65 %, AK Sberegatelniy Bank RF 26,73

Tiretskiy Solerudnik State owned

Uralkaliy Director of the board of directors Dmitriy Ribolovlev 78%, member of the board of directors Vladimir Shevtsov 2,1%, others 19,9%

• The major salt suppliers in Russia are shown in the following table (continued):

27

Russia: Salt Supply

Source: based on trade statistics and discussion with Industry

Domestic and Foreign Supply in Russia by Application - 2006 (in kt)

Supply Source

Application Local Supply Import Supply Total

Chemical Transformation 5655 0 5655

Road Salt 105 0 105

Human Consumption 370 730 1100

Other 1150 550 1700

TOTAL 7280 1280 8560

• The main uses for salt in Russia are shown in the following table.

• Chemical transformation is the major use:

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Russia: NaCl Supplier Market Shares

Soda Sterlitamak in Sterlitamak is the major producer of primary salt in Russia

100% = 8560 kt

SODA STERLITAMAK

38%

BASSOL 17%

MOZYRSALT BELARUS

3%

ILETSKSOL 6%

TIRETSKIY SOLERUDNIK

5%

SAYANSK-KHIMPROM

5%

ARTEMSALT UKRAINE

13%

KAUSTIK VOLGOGRAD

6%

SILVINIT SOLIKAMSK

7%

OTHER0%

Note: Graph includes captive use

29

Russia: Salt Consumption

• The Russian salt consumption is estimated ca. 8’500-8’600 ktpa whereas the merchant salt market size is about 4’500-4’600 ktpa (the brine salt does not constitute a part of the merchant market and accounts for ca. another 4’000 ktpa).

• In the merchant market, the consumption by end-uses is estimated to be as follows:

Application ktpa % Weight Chemical industry 1’650 36%

Table salt and food industry 1’150 25%

Gas and oil industry 280 6%

Paper and pulp industry 230 5%

Agriculture 280 6%

Energy 190 4%

Metallurgy 140 3%

Military 150 3%

Other 530 12%

TOTAL 4’600 100%

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• The merchant market structure by supplying companies is given below:

Primary Producer ktpa % Weight

Bassol 1’450 32%

Silvinit 640 14%

Iletsksol 520 11%

Artemsalt 1’100 24%

Mozyrsalt 180 4%

Megapolis Ltd. 40 1%

Akzo 10 0,2%

Siberian producers 660 13,8%

TOTAL 4’600 100%

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• The chemical industry is the biggest consumer of salt in Russia.

• Taking into account the non-merchant market salt consumption (that is the brine), the chemical industry share becomes more important.

• Forecasts for the chemical industry show that the production of caustic will grow at a moderate rate, while a a relatively significant production increase of soda ash is expected.

• Thus in the caustic sector the company Kirovo-Chepetskiy Khimzavod announced it would switch to KOH production. The other electrolysis plants especially those of with bigger capacities, are expected to increase their caustic output while those of the smaller capacity will face an uncertain future.

• In the production of soda ash Soda Sterlitamak announced its long term strategy to reach an annual output of ca. 2’000 ktpa of soda ash by 2010. The other smaller producer of soda ash Soda Berezniki is about to construct a 500 ktpa of dense soda ash plant with a planned startup in 2009.

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Russia: Major Consumers

Major Salt Consumers for Chemical Transformation

Company Location ApplicationEstimated Consump-tion (in kta)

Remarks

SODA /BASCHIM GROUP/

STERLI-TAMAK

SODA ASH 2700 CAPTIVE BRINE PRODUCTION

RUSSKAYA SODOVAYA KOMPANIA

MOSKVA/ BEREZNIKI

SODA ASH

800

TILL 2003 ROCK SALT SUPPLIED BY URALKALIY,NOW PURCHASE ON MERCHANT MARKET (KHIMPROMTORG BEREZNIKI)

KAUSTIK VOLGO-GRAD

CAUSTIC SODA

365 CAPTIVE BRINE PRODUCTION

CHIMPROM VOLGO-GRAD

CAUSTIC SODA

150BRINE SUPPLIED BY KAUSTIK VOLGOGRAD

• The major salt users for chemical transformation in Russia are shown in the following table:

33




Remarks

KAUSTIK/BASCHIM GROUP/

STERLI-TAMAK

CAUSTIC SODA

410BRINE SUPPLIED BY SODA STERLITAMAK VIA PIPELINE

AZOTNOVOMO-SKOVSK

CAUSTIC SODA

100SALT PURCHASED ON THE MERCHANT MARKET

KAPROLAKTAM DZER-

ZHINSKCAUSTIC

SODA150

SALT PURCHASED FROM BASSOL

UFACHIMPROM UFACAUSTIC

SODA45

BRINE VIA PIPELINE FROM STERLITAMAK/PLANT CLOSED

• The major salt users for chemical transformation in Russia (continued) :

34

• СОЛЬ С АНТИСЛЕЖИВАТЕЛЕМ • Поваренная соль является гигроскопичным продуктом, растворимым в

воде. Если влажность каменной соли не превышает 0,3% при её транспортировке и хранении, соль не слёживается и не смерзается. При влажности соли более 0,3% и неблагоприятных погодно-климатических условиях, а именно: относительной влажности воздуха более 75%, температуре воздуха ниже -15°C, соль смерзается. С целью предохранения соли от смерзания и слёживания при транспортировании и хранении в прогнозируемо не благоприятных погодных условиях нормативной документацией предусматривается внесение добавки - ферроцианида калия K4[Fe(CN)6]·3H2O. в следующих количествах по: ДСТУ 3583-97(ГОСТ 13830-97) и ГОСТ Р 51574-2000 - до 10г/т; ГСТУ 14.4-00032744-005-2003 и ДСТУ 4246:2003 - до 150 г/т.

• Допускается введение иного количества противослеживающей добавки (n) для продукции, выпускаемой по ГСТУ 14.4-00032744-005-2003 и ДСТУ 4246:2003, но максимальная величина не может превышать указанную в данных стандартах.

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Remarks

CHIMPROM CHEBOK-

SARI CAUSTIC

SODA140

SALT PURCHASED ON THE MERCHANT MARKET

KIROVO-CHEPETSKIY KHIMZAVOD

KIROVO-CHEPETSK

CAUSTIC SODA

130SALT PURCHASED FROM SILVINIT BEREZNIKI (SWITCHES PROD TO KOH)

SAYANSKCHIM-PROM

SAYANSK CAUSTIC

SODA230 CAPTIVE BRINE PRODUCTION

USOLIECHIMPROM (NITOL GROUP)

USOLIECAUSTIC

SODA150

BRINE SUPPLIED BY SAYANSKCHIMPROM


36




Remarks

BRATSK KOMPLEX HOLDING

BRATSK

CAUSTIC SODA,

PAPER & PULP

120SALT PURCHASED ON THE MERCHANT MARKET

CHIMPROM KEMEROVOCAUSTIC

SODA50

SALT PURCHASED FROM TIRETSKSOL TIRET

OTHER DZER-

ZHINSKCAUSTIC

SODA115

SALT PURCHASED FROM BASSOL


37


• There is substantial activity in the table salt and the food industry salt sector. Tension between Russia and Ukraine led to increased salt purchases by the population fearing of some Ukrainian retaliation for the natural gas affair (NOTE: Ukrainian salt suitable for human consumption exports to Russia are about 500-520 ktpa).

• According to the above breakdown the annual consumption of salt suitable for human consumption is about 1’150 kt, of which ca. 450 kt ends up in the food industry and 690-700 kt is as table salt.

• Artemsalt supplies about 500-520 ktpa of salt suitable for human consumption. Ukraine Megapolis (also known as Slavyansksalt) about 30-40 kt of iodized table salt, and another ca. 180 ktpa of table salt is supplied by Mozyrsalt.

• From Western Europe, Akzo supplies about 9-10 kt of mainly nitrite salt for the meat processing industry (ca. 6 ktpa) and another ca. 3 ktpa of iodized table salt from its Dutch and Danish plants. (Akzo‘s exclusive distributor in the RF is Eurosalt at St.Petersrburg).

• In this segment the share of imported salt is ca. 60-63% (in 2006).

38


• The paper and pulp industry is located mostly in the Severozapadniy region in Karelia, where the main producers of pulp and paper are to be found at Arkhangelsk-Novodvinsk, Segezha and Kondopoga.

• The „nearest” domestic salt producer is Silvinit, which is still quite far away from these sites (there are no salt imports from the Western side of this region).

• The paper and pulp sectors estimated annual salt consumption is about 230 kt.

• The main consumers are believed to be the major pulp producers in Karelia (European Russia). These include OAO Arkhangelskiy CBK at Novodvinsk (ca. 830 ktpa of pulp), OAO Segezha paper and pulp factory (ca. 300 ktpa of pulp), OAO Kondopoga (ca. 100 ktpa of pulp). Also close to Karelia is the OAO Kotlasskiy CBK Koryazhma (with about 1000 ktpa of pulp output). In the Severozapadniy rayon is the pulp producer Mondi Business Paper plant at Siktivkar (with ca. 550 ktpa of pulp output). The Solikamsk Paper and Pulp Company in Solikamsk produces about 70 ktpa of pulp. There are two major pulp producers in Siberia.

• As previously stated, the Karelia pulp-paper plants are located far away from the main primary salt producers and the railway transportation tariffs are increasing continuously.

39


• There are some leading trading companies supplying the domestic salt to the merchant market:

• Sol Chernozemlya the official salt trader of Artemsol is located at Voronezh,

• the company Solinvest at Nizhniy Novgorod sells salt produced by Bassol, Silvinit, Iletsksol, Mozyrsalt and Slavsol;

• the trading company Sol Zemli sells salt produced by Bassol;

• Torgoviy Dom Sol at Moskva sells salt of Artemsalt, Mozyrsalt as well as Slavyansksalt on the territory of the European Russia;

• Mineraltrading at Moskva is the exclusive salt trader for the primary producer Silvinit,

• Eurotrust Expo at Moskva head office sells salt of Mozyrsalt, Slavyansksalt as well as Artemsalt.

• Another top salt trader is Sol Regiona with head office at Samara sells salts of Bassol, Iletsksol, Silvinit and Artemsol.

• Khimpromtorg at Berezniki sells salt produced by Silvinit.

• TD Soldo sells Siberian salt of Tiretskiy Solerudnik and Sibsol.

40

Russia: Salt Trade

• In summary, the total Russian salt consumption is about 8’500-8’600 ktpa, and the merchant salt market size is about 4’500-4’600 ktpa.

• The Russian salt exports (30-40 ktpa), mainly to Kazakhstan from the neighboring Iletsksol, are quite small.

• There are significant imports of salt suitable for human consumption as well as industrial salt from Ukraine and Belarus.

• The imported salt share on the Russian merchant salt market is about 30%.

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Russia: Salt Trade

• Ukraine but also Belarus play a leading role in supplying the Russian merchant salt market. Thus in 2006, Artemsalt exported about 500-510 kt of salt suitable for human consumption. The same company supplied about 510-520 kt of industrial salt, and Slavyansksalt about 35-40 kt of iodized table salt. Mozyrsalt (Belarus) exported about 180 kt of salt suitable for human consumption.

• It is expected that the Ukrainian and the Belarus salt suppliers will retain their market shares in a medium term.

• Future imports through the port of Viborg north-east of the Kondopoga, Segezha and Novodvinsk/Arkhangelsk pulp-paper plants may be considered.

42

Russia: Salt Trade

• Main importers of Ukrainian salt to the Russian Federation are:

Importer Quantity (2006)

Elton 40 kt

Sol Chernozemla 90 kt

Transmarket 35 kt

Sodruzhestvo 96 120 kt

Salting 40 kt

Potencial 20 kt

Metrade 20 kt

Megatranzit 25 kt

Litrosna 270 kt

Dubna 10 kt

Briz 50 kt

AKB Trans 50 kt

Kursktara 25 kt

Belgorodtorgsnab 150 kt

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Russia: Salt Pricing

• Typical salt prices of Mineraltrading (exclusive trader of Silvinit) are as follows (as per 1st of January 2007):

• NOTE: Exchange rate 1 USD = 26 RUBL,1 EUR = 35 RUBL. Quoted prices do not include the transportation costs, prices are at the port-of-loading railway stations; 100% advance payment.

Salt Type Packaging Price Rubl/mt

Bassol 1’450 (Excl. VAT)

Common salt (food grade) 1 kg 1’563

Iletsksol 50 kg sacks 730

Ground salt bulk 540

Technical grade salt bulk 530

Salt for the oil-gas industry, water softening in the energy sector

bulk 530

Low grade quarry salt bulk 450

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• Typical salt prices of Bassol (top salt producer in the RF) are as follows (as per 5th of March 2007, in Rubl/mt excl. VAT):

Salt Type Common Salt Industrial Salt Halite

plus 10% VAT plus 10% VAT plus 18% VAT

Bulk Salt To Be Transported On Barges

Ground 2 --- 559 ---

Ground 3 --- 575 552

Coarse --- 537 516

Bulk Salt To Be Transported On Railway

Ground 2 --- 494 449

Ground 3 --- 463 423

Coarse --- 435 400

Salt In 1 Mt Of Containers To Be Transported On Railway

Ground1 (weight 900 kg) 702 669 ---

Ground 2 661 640 593

Ground 3 640 608 571

Coarse --- 586 539

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• Typical salt prices of Bassol (continued):

Salt Type Common Salt Industrial Salt Halite

plus 10% VAT plus 10% VAT plus 18% VAT

Packaged Salt In Sacks To Be Transported On Railway

Ground 1 776 --- ---

Ground 2 693 671 622

Ground 3 671 649 599

Coarse --- 599 551

Ground 1 iodized, with moisture cont. below 1% 887 --- ---

Ground + anticaking agent added, with moisture cont.

below 1% 874 --- ---

Packaged Table Salt/Plus 10%Vat/To Be Transported On Railway

non-iodised iodised

Packaged salt a 1kg in 40kg bags 1’450 1’592

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• Typical salt prices of Mozyrsalt (Belarus) are given below (price includes producer‘s price plus transport to the Belarus/Russian border):

Salt Type Price (Rubl per mt incl.

VAT)

Table salt in 50 kg sacks 2’386

Table salt in 25 kg sacks 2’398

Table salt a 1kg in 2O kg PE sacks 2’826

Iodized table salt in 50kg sacks 2’540

Iodized table salt in 25kg sacks 2’551

Iodized table salt a 1kg in 20 kg PE sacks 2’991

Tableted table salt in 25 kg sacks 5’653

Salt_RU

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