Strategic management of the potash industry in Russia

Abstract

Mineral resources and the mining industry play an important role in economic development of many countries. The unique Russian mineral raw material base – phosphate and potash ore reserves in the case under consideration in this work – allows domestic mining and chemical companies not only to meet domestic demand but also to act as significant players on a global scale. Russian fertilizer companies enjoy a significant share of the global fertilizer market and have considerable strategic and social importance to the national economy. The objective of this paper is to identify and adopt the most appropriate methods and tools applicable to the peculiarities of fertilizer market and industry, as well as its highly dynamic environment. The paper briefly reviews research of strategic management in industry. We analyzed the current state of the mineral fertilizers market, identified main development trends and presented the unique characteristics of fertilizer (mining and chemical) companies in an oligopolistic market. The paper presents characteristics of industry environment using Ansoff's environmental turbulence matrix to evaluate appropriate management response and highlights the key features of fertilizer companies’ strategic management. We find the study of mineral assets, as well as event analysis to be the key elements in defining rather appropriate strategic responses of mineral fertilizer industry to its turbulent environment.