On Friday, Haifa Chemicals Ltd. CEO Nadav Shachar wrote to Prime Minister Benjamin Netanyahu and several ministers, asking them to intervene in setting the price of potash for the domestic market. The company claims, "only a reduction in the price of potash will ensure the business of Haifa Chemicals, the employment of thousands of workers, and the transfer of hundreds of millions of dollars to the Israeli economy each year."
Shachar also claims, "Not only has Israel Chemicals obtained a monopoly on the country's natural resources, it obtained an additional gift when the government removed controls on potash prices. The Israeli government must quickly act to lower the price of potash as other countries have done, in order to put an end to the unacceptable and immoral situation in which Haifa Chemicals' employees are not eligible to benefit from Israel's natural resources because a private monopoly is blocking their access to them."
Last week, Haifa Chemicals shut down its production lines at its plants in Haifa and at Mishor Rotem in the Negev. The company claims that it is losing money because of the high price for potash charged by Israel Chemicals.
In response, Israel Chemicals Ltd. (TASE: ICL) unit Dead Sea Works wrote to Netanyahu and the ministers. It said that Haifa Chemicals is a private company registered in the US which is seeking to pressure the Israeli government to compel Dead Sea Works - a subsidiary of an Israeli public company whose shares are owned by the general public through pension funds - to subsidize the price of potash that Haifa Chemicals buys from the company.
Dead Sea Works stated, "In other words, Haifa Chemicals is asking the Israeli government for the Israeli public to finance and subsidize the foreign private owners of Haifa Chemicals by intervening and compelling Dead Sea Works to lower the market price of potash, and it is doing so by means of populist and cynical action by Haifa Chemicals' employees."
Published by Globes [online], Israel business news - www.globes-online.com - on April 26, 2009
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