SPECIALITY FERTILISER FOR MODERN AGRICULTURE
What is SOP?
Sulphate of Potash (SOP) is low chloride, premium potash fertiliser. It is essential for high value chloride intolerant crops such as many fruits, vegetables and tree nuts.
It is differentiated to the bulk and low value form of potash called Muriate of Potash (MOP). To put this in perspective, the total potassium fertiliser market was 71 million tonnes in 2019, comprising 64 million tonnes of MOP and 7 million tonnes of SOP. Importantly SOP trades at nearly twice the price of MOP and is currently experiencing a global supply shortage.
SOP is leveraged to many global megatrends and the future looks very encouraging. Farmers are having to produce more from less land, as the global population continues to grow and arable land continues to decrease. The rising middle class are demanding better diets including more fruits and vegetables. To survive these trends it is essential that crop yield increase through the use of more sophisticated fertiliser usage such as SOP.
Agrimin will benefit from being on the doorstep of key growth markets for SOP throughout South and Southeast Asia. These are regions must shift to more intensive agriculture to produce more food for more people from less land. India, Indonesia, Malaysia and Brazil account for one third of MOP demand, yet they only consume 2% of the world’s demand. We expect these regions to significantly increase their application rates of SOP as they gradually move towards the rates that we see in the USA, China and Europe.
Agrimin is well placed to take advantage of the clearly strong market fundamentals which support new SOP production. Western Australia is emerging as an important SOP producing region which benefits from excellent technical attributes, low geopolitical risk and is strategically located for supplying the growing markets of southeast Asia.