Trade

Russian oligarch woos Brussels to corner multi-billion industry

APATIT, Russia — The European Commission has an unlikely ally in its fight for stricter environmental standards on agricultural fertilizers: a Russian oligarch.

Andrey Guryev Jr., chief executive of the phosphate mining company Phosagro and one of his country’s richest men, has been busy in Brussels. He’s leading a lobbying effort in favor of a Commission proposal to limit the amount of cadmium — a toxic heavy metal — in fertilizers sold within the bloc’s borders.

The EU’s plan, which is part of a broader reform of the €25 billion fertilizer industry, is intended to protect the environment and public health.

For Guryev, 35, it’s a once-in-a-lifetime opportunity to move aggressively into Europe. The fertilizer from his phosphate mines in Apatit, located 200 kilometers above the Arctic Circle, has naturally low levels of cadmium — unlike that from countries like Morocco and Tunisia, which dominate the European market but have high levels of the carcinogenic mineral.

“We can provide a better quality fertilizer and better service for the European farmers,” says Guryev. “Europe for us today is an opportunity to tell the story of pure phosphate.”

Guryev Jr., became CEO of Phosagro in 2013, when he took over the company from his father, Andrey Guryev Sr., who had built it during the wildcat years of Russian capitalism, growing it from a state-owned Soviet behemoth into a business with a stock market value of nearly €5 billion.

The phosphate Guryev plans to sell to Europe comes from Apatit, one of the world’s largest phosphate mines, located in the stark region of Murmansk in the Kola peninsula.

The Guryev family owns nearly 50 percent of the company — Vladimir Litvinenko, Putin’s campaign manager, holds another 19 percent — which was listed on the London Stock Exchange in 2011. In 2008, the family bought Witanhurst, the second-largest private house in London, after Buckingham Palace.

The elder Guryev is famously private. Though he served as a Russian senator for 11 years — stepping down in 2013 after the Kremlin introduced anti-corruption laws — he has never given a press interview.

His son is more open, in part because of his push to promote “pure phosphate.” In an interview in his office in Moscow, Guryev Jr. played down concerns raised in Brussels that strict limits on cadmium would give Phosagro — and thus the Kremlin — too much leverage in Europe.

“The fertilizers business is not energy, it’s not like the defense business,” he said. “If you look at the government involvement in Russian companies, it’s in infrastructure or oil and gas.”

Phosagro has desrcibed its product as “green fertilizer” in meetings with European officials | Remy Gabalda/AFP via Getty Images

“If you talk about using our commodity in a geopolitical way, we only represent 5 percent of the global trade.” he added. Phosagro is “not a Gazprom in any country,” he said, adding that Russia is not the only producer of fertilizer with low levels of cadmium.

Guryev is round-faced and stocky. He showed up to the interview on crutches, having recently slipped on ice in Moscow. He wore a shirt with a pink tie and an Audemars Piguet watch, valued at more than €30,000. (“It was a gift,” he said.) He declined to answer questions about his relationship with his father or the family’s real estate investments in London, but allowed that he has had a “short but productive life” and enjoys reading Russian history.

The phosphate Guryev plans to sell to Europe comes from Apatit, one of the world’s largest phosphate mines, located in the stark region of Murmansk in the Kola peninsula, a five-hour flight north from Moscow. Trucks the size of small buildings crawl across the ice-covered landscape, hauling phosphate rock from deep beneath the earth up an immense stepped pit. Inside the colossal phosphate processing factory, a billboard indicates the number of days since his last worker lost his life: 274.

“The first time I was brought to the mines I was around 15-16 years old,” Guryev said. He had just started working for the company and his father wanted to show him what was at stake, telling him, “If you want to have something you will have to go and work.”

On Tuesday, Guryev’s focus will shift from the ice-covered hilltops of Apatit to Strasbourg, where lawmakers in the European Parliament will hold a key vote on the Commission’s cadmium proposal.

Stricter limits would reshape the billion-euro fertilizer industry, providing Guryev’s sprawling enterprise with a significant boon and a leg up on its competitors.

The European Commission’s plan would tighten cadmium levels from 60mg/kg to 40mg/kg after three years and to 20mg/kg after 12 years, requiring mines in Morocco and other African countries to invest in new technologies to meet the new requirements. Today, 70 percent of EU phosphate imports come from North and West African countries.

Lawmakers at the European Parliament are set to hold a key vote on the Commission’s cadmium proposal | Christopher Furlong/Getty Images

There’s every chance that the EU’s fertilizer plans could shift toward endgame discussions from this week. If members of the European Parliament agree their positionTuesday, that will give the green light for three-way talks between the Commission, Parliament and the 28 EU countries.

For Guryev, everything is still to play for in this so-called trilogue phase. As is often the case on such technical files, the devil is in the details and MEPs are seeking amendments that oppose stricter limits on cadmium.

In the run-up to the vote, Guryev has engaged in a lobbying war, primarily with the Moroccan state-owned mining monopoly, the OCP group. In 2013, when Commission officials first proposed tightening cadmium levels below 60mg/kg, OCP hired the London-based law firm Dechert LLP to make its case, and as the fight intensified further, the PR firm Edelman.

In addition to pushing for stricter cadmium restrictions, Guryev has been lobbying the EU to drop a 6.5-percent import tax on Russian fertilizer.

For the past three years, Dechert has been in regular contact with Commission officials and MEPs in charge of the regulation, as well as permanent representations, distributing position papers and studies opposing the proposed limits.

Phosagro meanwhile has pressed its case directly, describing its product as “green fertilizer” in meetings with European officials. It has also hired EPPA, a Brussels-based consultancy, to convince EU countries with existing cadmium restrictions in national legislation to press for similar limits at the European level.

Guryev described Europe as “a key market” for the company and a target for expansion. In addition to pushing for stricter cadmium restrictions, he has been lobbying the EU to drop a 6.5-percent import tax on Russian fertilizer. “We are one of the largest suppliers to Europe anyway,” he said. “Who pays [for this policy] are the EU farmers.”

In the interview, he looked forward to a day when there would be better relations between Russia and the EU. The ongoing political tensions are harming business on both sides, and companies can only gain from closer, warmer ties. “I think every businessman today doing business between Russia and some other country is an ambassador for the country,” he said.

Original Article

Related Articles

30 Comments

  1. This is the perfect webpage for everyone who hopes to find
    out about this topic. You understand so much its almost hard
    to argue with you (not that I really would
    want to…HaHa). You definitely put a fresh spin on a subject
    which has been written about for many years. Great stuff, just excellent!

    my blog post … slot aaa1188 (918kiss-m.com)

  2. I have been surfing online greater than 3 hours lately, yet I never found any
    fascinating article like yours. It is pretty worth sufficient for me.

    In my view, if all webmasters and bloggers made excellent content material as you
    did, the web will probably be a lot more useful than ever before.

  3. It’s appropriate time to make a few plans for the long run and it is time to be happy.
    I’ve read this publish and if I may just I want to suggest you few fascinating issues
    or advice. Maybe you could write subsequent articles regarding this article.

    I wish to read more things about it!

  4. Hi! I know this is somewhat off topic but I was wondering which blog platform are
    you using for this website? I’m getting fed up of WordPress because I’ve had issues with hackers and I’m
    looking at alternatives for another platform. I would be awesome if you could
    point me in the direction of a good platform.

    Feel free to visit my blog post; rollex11 test

  5. I do believe all the ideas you’ve offered in your post.
    They’re really convincing and can definitely work. Still, the posts are too brief for beginners.
    May just you please extend them a little from next time?
    Thank you for the post.

    Also visit my web page: 918kiss 2 Download

  6. Have you ever thought about including a little bit more than just
    your articles? I mean, what you say is important and everything.
    Nevertheless just imagine if you added some great visuals
    or video clips to give your posts more, “pop”! Your content is
    excellent but with images and videos, this website could certainly be one of the best in its niche.
    Amazing blog!

    Also visit my web blog; test lpe88

  7. hey there and thank you for your information – I’ve definitely picked up
    anything new from right here. I did however expertise
    a few technical issues using this web site, since I experienced
    to reload the site lots of times previous to I could get it
    to load correctly. I had been wondering if your web hosting is OK?
    Not that I am complaining, but sluggish loading instances times will very frequently affect your placement in google
    and could damage your high-quality score if advertising and marketing with Adwords.

    Well I’m adding this RSS to my e-mail and could look
    out for much more of your respective intriguing content.
    Ensure that you update this again soon.

    Also visit my site – free download epicwin

  8. Its like you learn my thoughts! You appear to grasp a lot about this, like you wrote the guide in it or something.

    I believe that you just can do with some percent to drive the message house a little
    bit, but instead of that, this is excellent blog.

    A fantastic read. I will certainly be back.

  9. Greetings from Los angeles! I’m bored at work so I decided
    to check out your website on my iphone during lunch break.
    I enjoy the information you present here and can’t wait to take a
    look when I get home. I’m surprised at how quick your blog loaded on my cell phone ..
    I’m not even using WIFI, just 3G .. Anyhow, fantastic site!

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button