Investing in Phosphorus

Phosphorus is a nonmetal used in the fertilizer industry. Phosphorus is an essential element for plant and animal nutrition and is consumed primarily as a principal component of nitrogen-phosphorus-potassium (NPK) fertilizers. Phosphate rock minerals are the only significant global resources of phosphorus. Phosphate rock is used primarily for production of wetprocess phosphoric acid for fertilizer applications, which accounts for more than 95% of domestic consumption.

Domestic Production and Use: Phosphate rock ore was mined by 6 firms at 12 mines in 4 States and upgraded to an estimated 26.1 million tons of marketable product valued at $1.3 billion, f.o.b. mine. Florida and North Carolina accounted for more than 85% of total domestic output; the remainder was produced in Idaho and Utah. Marketable product refers to beneficiated phosphate rock with phosphorus pentoxide (P2O5) content suitable for phosphoric acid or elemental phosphorus production. More than 95% of the U.S. phosphate rock mined was used to manufacture wet-process phosphoric acid and superphosphoric acid, which were used as intermediate feedstocks in the manufacture of granular and liquid ammonium phosphate fertilizers and animal feed supplements. Approximately 45% of the wet-process phosphoric acid produced was exported in the form of upgraded granular diammonium and monoammonium phosphate (DAP and MAP, respectively) fertilizer, and merchant-grade phosphoric acid. The balance of the phosphate rock mined was for the manufacture of elemental phosphorus, which was used to produce phosphorus compounds for a variety of food-additive and industrial applications.

Events, Trends, and Issues: In 2010, phosphate rock consumption and trade increased worldwide after depressed market conditions in 2008 and 2009. U.S. production was about the same as in 2009, as companies attempted to lower stocks of phosphate rock that had accumulated over the previous year. Domestic phosphoric acid and phosphate fertilizer production increased over that of 2009. The world spot price of phosphate rock began 2010 around $90 per ton and increased in the third quarter to around $150 per ton. A new 3.9-million-ton-per-year phosphate rock mine in northern Peru began operation in July. The leading U.S. phosphate rock producer acquired a 35% share of the joint venture between the Brazilian and Japanese owners of the mine. The U.S. company will have the right to purchase up to 35% of the annual phosphate rock output to supplement its domestic phosphate rock production. A new 5- million-ton-per-year phosphate rock mine began operation in Saudi Arabia late in 2010. The associated phosphate fertilizer plant was to open in 2011. World mine production capacity was projected to increase to 228 million tons by 2015 through mine expansion projects in Algeria, Brazil, China, Israel, Jordan, Syria, and Tunisia, and development of new mines in Australia, Kazakhstan, Namibia, and Russia.

World Resources: Domestic reserves data were based on U.S. Geological Survey and individual company information. Phosphate rock resources occur principally as sedimentary marine phosphorites. The largest sedimentary deposits are found in northern Africa, China, the Middle East, and the United States. Significant igneous occurrences are found in Brazil, Canada, Russia, and South Africa. Large phosphate resources have been identified on the continental shelves and on seamounts in the Atlantic Ocean and the Pacific Ocean.

Substitutes: There are no substitutes for phosphorus in agriculture.

Phosphorus Producers
Agrifos Fertilizer -
Agrium (NYSE: AGU) - - Their Nu-West Industries subsidiary mines in Idaho.
Aguia Resources (ASX: AGR) - phosphate projects in Rio Grande do Sul, Brazil
Celamin Holdings (ASX: CNL)
CF Industries (NYSE: CF) - - Manufactures and distributes phosphate and nitrogen fertilizers
Great Quest Metals (CVE: GQ) - - Tin Hina phosphate rock deposit in the Tilemsi Valley in northeastern Mali
Innophos Holdings (NASDAQ: IPHS) - - upgrades merchant-grade phosphoric acid into high-purity acid for technical- and food-grade applications
J.R. Simplot - - operates the Vernal Mine in Uintah County, Utah.
Liberty Phosphate
MBAC Fertilizer (NEX: MBC) - Araxa phosphate project in Minas Gerais, Brazil
Minbos Resources (ASX: MNB) - Cacata phosphate propect in Cabinda Province, Angola
Minemakers Ltd. (ASX: MAK) - - Wonarah phosphate rock mine in Northern Territory, Australia. Also the Sandpiper/Meob offshore phosphate deposit in Namibia
Mississippi Phospates Corp. -
Monsanto (NYSE: MON) - - Their P4 Production subsidiary mines phosphate rock in Idaho
Mosaic Co (NYSE: MOS) - - They provide a variety of phosphates for crop nutrition.
OCP Group - - Moroccan phosphate rock producer
Oklo Uranium Ltd. (ASX: OKU) - - Tatteul phosphate rock deposit in northeastern Mali
Potash Corp (NYSE: POT) - - Their phosphate business produces liquid and solid phosphate fertilizer. Their PCS Phosphate subsidiary has phosphoric acid and fertilizer production facilities in Florida and North Carolina
Sterling Group Ventures (OTC: SGGV)
Toguna SA - phosphate producer in Mali
Vale (NYSE: VALE) - - In May 2010, Vale bought Fosfertil SA in for $3B, and Bunge's Brazilian fertilizer business for $1.7B. The combined business is called Vale Fertilizantes, and is planning to triple annual phosphate output to 19.2 million tons by 2017.

American Association of Plant Food Officials (AAPFCO) -
The Fertilizer Institute -
International Fertilizer Industry Association -
International Fertilizer Development Center -
International Plant Nutrition Institute -

Tampa Port Authority -

(wiki) - Phosphorus on Wikipedia

Phosphorus News
2011-07-26 - (bl) - Acron to start own phosphate output within year, counter costs
2011-07-07 - (yal) - Phosphate: A critical resource misused and now running low
2011-07-07 - (pi) - Aguia Resources options two phosphate projects in Brazil
2011-07-06 - (im) - Phosphate capacity to increase 26% in next five years
2011-07-01 - (pp) - Will phosphate be Canada's next potash?
2011-06-29 - (mw) - MBAC acquires option to buy phosphate project in South East Brazil
2011-06-22 - (bw) - Officials approve Monsanto phosphate mine in Idaho
2011-06-21 - (wnn) - Investment boosts phosphate development
2011-06-18 - (ame) - Ma'aden starts initial production of diammonium phosphate fertilizer
2011-06-16 - (pi) - Celamin Holdings emerging phosphate producer under the radar for some investors, but not all
2011-06-16 - (mw) - Eagle Star Minerals Corp. acquires mineral concessions with high phosphate potential in the Parnaiba Basin, State of Piaui, North East Brazil
2011-06-15 - (mw) - Sterling receives business license to operate China phosphate project
2011-06-13 - (dj) - Feds weigh comments on Monsanto Co.'s proposal to open new phosphate mine in eastern Idaho
2011-06-10 - (im) - Mali group eyes 200,000 tpa phosphate production by end of 2012
2011-06-10 - (bw) - Research and Markets: White phosphorus (CAS 12185-10-3) Market Research Report 2011
2011-06-03 - (ri) - Feeding the world's hunger for phosphorus
2011-05-24 - (op) - Forget oil and gold - Phosphorus is the commodity everyone should be concerned about
2010-09-07 - (wsj) - Vale looks to carve out a fertile future

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