What is SOP?
Sulphate of Potash (SOP) is a premium form of potash fertilizer which contains two of the six macro-nutrients that are essential to plant growth, being Potassium and Sulphur.
The total Potassium fertilizer market was 75 million tonnes in 2017, predominantly comprising of 68 million tonnes of Muriate of Potash (MOP) and 7 million tonnes of SOP. MOP contains 46% Chloride. The major potash deposits around the world – such as those in Canada, Russia and Belarus – produce MOP. This product is most appropriate for the commercial cultivation of the carbohydrate crops including wheat, oats, barley and palm oil.
SOP contains 18% Sulphur and has almost no Chloride. It is a premium value product which is used principally for specialty crops such as fruits, vegetables and tree nuts. SOP is superior to MOP because of its low level Chloride, which has a toxic impact on many food plants, especially leafy plants. SOP improves the yield, taste, colour and shelf life of crops. SOP is also most suitable for agricultural areas affected by high salinity soils.
As the world’s population expands and the middle class in China continues to emerge, it is anticipated that increasing consumption of specialty crops will drive demand growth for SOP.
SOP can be produced from primary and secondary sources, with approximately 75% of global production controlled by the top five producers. Primary production comes from salt lake (brine) deposits located in China, USA, Chile and India. The balance of the world’s supply is made up of more costly and inefficient secondary production sources. Approximately half of global supply comes from the Mannheim Process which involves the addition of sulphuric acid to MOP in a Mannheim furnace to produce SOP. Global SOP is currently constrained because for every 1.0 tonne of SOP produced, 1.2 tonnes of hydrochloric acid by-product, and the disposal of this acid is problematic.
Agrimin is aiming to take advantage of strong market fundamentals which are supportive of new SOP production. In particular, the last decade has seen a clear trend towards environmentally friendly SOP production from salt lake deposits. Given that existing salt lake producers are unable to meet current SOP demand, Agrimin expects that Western Australia will emerge as an important SOP producing region. In contrast to other major undeveloped SOP regions, Australia benefits from low geopolitical risk and is strategically located for supplying the growing markets of south-east Asia.