The Russian potash producer, OAO Uralkali, announced this week it is cutting its first quarter potash production approximately 40 percent from a year ago. The production curtailment stemmed from China and India postponing their potash purchases, according to Bloomberg.

As a result, the company could cut its 2012 production target further this year. Uralkali’s CEO Vladislav Baumgertner said the forecast for this year was lowered to 10.5 million tons to buoy prices. 

“India resumed potash purchases this month while asking to extend the first-quarter schedule until August,” Oleg Petrov, Uralkali’s director of sales and marketing, told reporters in Moscow, according to “Bloomberg. “This means a delay in sales of 600,000 metric tons to 700,000 tons that Uralkali’s Belarusian Potash Co. trader had planned for the first three months.”

The world’s largest potash producer plans to sign an accord with China in April and May and will be seeking a price increase, according to Petrov.

In other parts of the world, demand remains strong in Brazil as it expects to increase its purchases. However, local stockpiles may decrease sales in Brazil and Asia.

Petrov said world potash consumption will probably stay little changed this year at about 58 million tons, while physical supplies will fall to about 56 million tons because of stockpiles from last year.