After US$198 million in investments to date, Brazil Potash is advancing its Autazes Potash project to the construction phase and is seeking to broaden its shareholder base prior to conducting a future planned public listing.
Potash is the most important of the three main fertilizer nutrients required to efficiently grow food, and currently represents a massive growing ~$16 billion annual market. And potash is more important than ever as increasing our planet’s agricultural productivity is essential to securing the food needed for the world's ever growing population (estimated to reach 8.5 billion people by the year 2030) while also protecting the environment (increasing productivity in the same land).
Brazil is the fastest growing potash consumer in the world, and the second largest consumer globally (after China), fueling its position as the ‘bread basket of the world’. As a leading producer of key meats, orange juice, coffee, sugar and soy beans, Brazil is one of the world's largest net exporters of agricultural goods.
But there’s one major problem: to meet its needs, Brazil imports 95% of its potash, primarily from Russia and Canada, resulting in significant transportation expenses, high product costs, and unnecessary CO2 emissions.
Brazil Potash has defined what it believes to be a new potash basin 2/3 the size of the world's largest basin, in Saskatchewan, Canada - and twice the size of the famous Russian Urals basin. Brazil Potash has developed a portion of this basin, called the Autazes project, which is located only five miles from a major river system, to a near construction-ready state. Initial plans call for producing 2.4 million tons of potash per year.
Even better this home-grown potash will be transported at low cost, primarily using river barges, to Brazilian farmers who currently consume 10.6 million tons of potash per year.
Due to the project’s location (in Brazil, beside a river), Brazil Potash anticipates that its cost to extract, process, and deliver potash to farmers will be less than the transportation cost alone for imported potash. This will result in a substantial and sustainable cost advantage, for this essential, substitute-free nutrient for growing food.
Brazil Potash is a privately owned corporation, that holds title to a world-class potash basin in Amazonas, Brazil.
We have raised in excess of US$198 million since inception, to:
The main goal from this current capital raise is to bring the Autazes project to a fully construction ready state by completing work required to obtain the Installation License, purchase the final parcels of land required, implement the social and environmental plans and conduct engineering work to optimize the processing plant design.
Potash is a potassium-rich salt, crucial for developing fertilizers, as potassium is an essential element for the growth of all forms of life - including crops. Using potash to rectify potassium deficiencies in soil increases both the quality and quantity of crop yields.
Potassium (K) is one of the three main nutrients, along with Nitrogen (N) and phosphorus (P) found in most fertilizers, as defined by the fertilizer’s NPK content which is typically printed on the front of fertilizer bags.
Potash plays a vital role in sustainably maintaining the global food supply, especially against the future strains of population growth and suitable land shortages around the world.
Source: United States Department of Agriculture
As an agribusiness powerhouse, Brazil accounts for a large percentage of the world’s seabourne agricultural trade, despite currently using only 25% of its land potential, and having the highest amount of freshwater on the planet. With agribusiness representing ~24% of Brazil’s current GDP, and an industry growing at an estimated rate of 4.4%, Brazil’s primary crops, all highly potash-dependent, consist of a significant, and growing, portion of the global food supply.
Potash is an integral part of Brazil’s prosperity. In fact, Brazil uses more potash than any nation other than China yet the majority of its supply is currently imported from Canada and Russia.
This journey requires travelling 9,000-12,000 miles by rail, boat and then truck to reach Brazilian fertilizer blenders. This results in significant impacts on the bottom line (high logistical costs) and the environment (high GHG emissions), which are both unnecessary and costly in light of Brazil’s locally abundant, but untapped, source of potash.
Brazil Potash holds title to a world-class potash basin in the Brazilian state of Amazonas, only five miles from a major river system, which will be used to transport potash on river barges to farmers throughout the country. Even based on today’s depressed global oil prices and shipping rates, Brazil Potash expects it will be able to extract, process, and deliver potash to Brazils’ farmers at the same cost as importers’ logistics costs alone.
Not only that, but management anticipates the Autazes potash project will create an estimated 1,200 direct jobs, and a further 4,800 indirect jobs - for at least 34 years based on drilling to date of only 10% of the potential potash basin identified. Even better, these jobs will be primarily for locals that currently live off the land, at times resorting to illegal deforestation to provide food for their family as a last resort.
Additionally, the planned construction of a new electricity transmission line, from the national electricity grid in Manaus to the project, is expected to take over an estimated 100,000 people off of emission-intensive, diesel-generated power, and replace it with more sustainable, 75% hydroelectric-generated power.
(1) Downside Case based on 10-year low CFR Brazil KCI price for life of mine | (2) Base Case based on Integer Research CFR Brazil KCI forecast prices | (3) Upside Case based on US$500/t CFR Brazil KCI prices for life of mine | (4) See Financial Projections Disclaimer
Once production begins, Brazil Potash is anticipated to be the lowest all-in cost potash supplier to Brazil. Again, this is thanks to our logistical cost advantage of around $129/ton versus Canadian and Russian producers.
Due to the high transportation and production costs faced by potash importers, at a potash sale price of $230, ~70% of global potash producers are either breaking even or losing money. That’s a staggering result. But even at this low historical price, Brazil Potash is projected to have an 188% profit margin, due to our in-country logistics cost competitive advantage.
Brazil Potash anticipates:
Our commitment to domestically sourced Brazillian potash, global food security, and generational prosperity allows investors to play a pivotal part in the world’s food supply. And in the process, securing sustainable nutrition for the planet’s growing population - and financial security for themselves and their families for generations.
The Autazes mine has the potential to be operational for generations to come, creating a sustainable source of income from future dividends paid to investors, with the added benefit of creating widespread prosperity for Brazilians and indigenous people with few available opportunities of this caliber.
Majority of proceeds from this fundraise will be directed towards completing the remaining work needed to obtain the installation license required to start construction.
Chairman Stan Bharti is a renowned international businessman and entrepreneur with over thirty years of hands-on experience developing global mining projects. Over the last ten years, he has invested and raised over US$10 billion.
Matt Simpson has a well-rounded background of designing and constructing mines internationally, while working for Hatch Engineering, and later operating a large RioTinto-owned mine with 650 reports and a US$300M/year budget.
Marcos Pedrini has extensive hands-on experience selling and arranging delivery of potash in Brazil, from his over 35 years of experience, primarily with Vale, where he retired as General Manager, Agriculture Sales.
Guilherme Jacome joins from Vale where he was General Manager of Projects, responsible for the engineering and construction of several Brazil-based projects, including the expansion of a Brazil-based potash operation.
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