Reuters / A Brazilian fertilizer deposit owned by Canada’s Brazil PotashCorp has potash reserves equal to at least 18 years of Brazil’s potassium-fertilizer needs, a source with direct knowledge of the project told Reuters.
The mine project has total potassium reserves of about 500 million tonnes of which at least 125 million, or a quarter, is made up of at least 25 per cent potassium chloride, a high-enough grade for commercial production, the source said.
Toronto-based Brazil Potash, whose investors include Canadian merchant bank Forbes & Manhattan as well as Australian investors, hopes to begin production at the site near Autazes, Brazil in the state of Amazonas in 2017 or 2018, according to the source.
The Brazil Potash asset is one of several potential potash projects in a 400-kilometre (250-mile) Potash Belt south of the Amazon River. Brazil’s Mines and Energy Ministry believes the region could produce enough potash to eventually make Brazil one of the world’s largest producers.
“If we had a plant we could supply the whole country with potash for 100 years,” said Daniel Nava, mining secretary of Amazonas state.
The Brazil Potash project is expected to cost $2 billion to $3.5 billion to build and Brazil Potash hopes to sell as much as $1 billion of stock in its Brazil-based Potássio do Brasil operating unit in the next year to help finance construction, the source said.
Depending on financing, the mine, close to the Madeira River, a major Amazon tributary, could produce between two million to four million tonnes a year, the source said.
Brazil’s extensive soils are derived from mostly ancient geological formations and lack high levels of the three main plant nutrients: potassium, nitrogen and phosphorus.
Brazil uses about seven million tonnes of potash a year to help make up for this nutrient deficit.
Top-quality potash reserves are rare. Much of the world’s supply comes from a handful of countries including Canada, Belarus and Jordan. Arriving in ports on Brazil’s southeast coast, a large portion of Brazil’s potash imports must be trucked 1,500 kilometres (930 miles) or more to fertilize fields in farming regions such as Mato Grosso state.