IM Agriminerals News in Brief 19 – 25 September

By James Sean Dickson
Published: Friday, 25 September 2015

Uralkali finance facility signed; Danakali registers salt resource at SOP project; Dorowa Minerals receives $5m to advance phosphate development.

US-based Mosaic Co. has updated its Q3 2015 guidance in response to crop nutrient market conditions, including delayed purchases in Brazil and North America.

"Domestic and international crop nutrient markets have softened," Mosaic said, adding that "currency volatility, lower grain and oilseed prices, political and economic uncertainty, as well as global equity market declines have adversely impacted market sentiment".

Joc O’Rourke, Mosaic’s CEO, said: "The industry faces some near-term challenges in the current environment. It is a time for leadership, and we are managing our production levels to match current demand, controlling our costs and maintaining our discipline."

Mosaic now expects to produce 2.1-2.4m tonnes phosphates and 1.6-2m tonnes potash in Q3. Selling prices for diammonium phosphate are projected to fall within the $435-455/tonne range, while muriate of potash (MOP) prices are expected to be at the bottom of the company’s previously announced range of $260-280/tonne.

Russia-based Uralkali OAO’s subsidiary, Uralkali-Technology, has signed a master agreement and confirmation with VTB Capital for a REPO transaction in which shares will be exchanged for a total amount of $800m.

Uralkali-Technology will issue just over 370m shares representing 12.6% of the company’s share capital.

Meanwhile, Uralkali itself is to increase the size of its previously approved common share purchase programme. The company will expand its self-owned holding to over 700m shares, accounting for 24% of its share capital.

Uralkali said its board had considered recommendations from the company’s audit committee and non-executive directors before agreeing to the extension of the repurchasing programme.

In Australia, ASX-listed Danakali Ltd has registered a 347m tonne rock salt mineral resource estimate for the Eritrea-based Colluli project.

The project’s rock salt sits "directly above" the higher value potassium-bearing salts according to Danakali, which owns the project in a 50:50 joint venture with the Eritrean National Mining Co. The company intends to produce sulphate of potash (SOP) fertiliser from the project and had previously considered the halite component of the site to be a waste product in its reports.

"This material represents excellent upside potential for the project," Paul Donaldson, Danakali’s CEO, said. "The fact that this material will be mined from the deposit, is of suitable quality for de-icing and other applications in nearby jurisdictions, and is in close proximity to the coast, means that the rock salt represents a potential additional revenue stream for the project."

The salt layer will be removed via surface miners, and there is further volume potential in other areas of the project, Danakali said.

Vancouver, Canada-based American Potash Corp. has announced that its petition to the federal Bureau of Land Management (BLM) for the reinstatement of 12 potash prospecting permits via Sweetwater River Resources LLC has been denied.

Thus, Sweetwater has applied to the BLM for 12 new permits "analogous to and encompassing the same area" as the original 12 permits. American Potash is also considering an appeal of the dismissal of the original 12 permits.

Via its Nevada subsidiary, American Potash LLC, American Potash holds 11 state potash leases spanning 2.85km2.

Zimbabwe-based Dorwowa Minerals Ltd, a subsidiary of Chemplex Corp. has secured $5m from the Reserve Bank of Zimbawe (RBZ) to increase phosphate production, according to a government report seen by local newspaper The Chronicle.

"Dorowa Minerals secured $5m from the RBZ to boost its phosphate production," the report said.

The comapny is the sole phosphates producer in Zimbabwe. It extracts the fertiliser mineral from an open cast mine and passes on milled and floated concentrates to its sister company, ZimPhos.

Chemplex claims that the mine contains phosphate ore grading at 5-6% phosphate (P2O5).

The Ministry of Mines in Ethiopia is to issue a potash mining licence to Yara Dallol BV, a subsidiary of Norwegian fertiliser producer Yara International ASA according to local paper the Reporter.

Tolossa Shagi, the Minister of Mines, said: "We have to evaluate the proposal and grant them the mining licence as soon as possible."

The Ministry will then send the draft mining licence to the Council of Ministers for approval, which, pending support, would pave the way for Yara to produce 1-1.5m tpa potash at the site.