Focus Acquires Phosphate Project in the Bayovar District, Peru

September 10, 2013; Vancouver, Canada: Focus Ventures Ltd. (TSX-V: FCV) is pleased to announce that its Peruvian subsidiary Agrifos Peru S.A.C. has signed a binding Letter of Intent (LOI) with Juan Paulo Quay S.A.C. for the exploration and acquisition of the Bayovar 12 phosphate mining concession, located 70 km south of the city of Piura in northern Peru, close to Vale's operating Bayovar phosphate Mine. Focus believes the Bayovar 12 property shows potential to host a large sedimentary phosphate deposit and is planning a systematic grid-based drill program which will commence as soon as exploration permits are received from the authorities. Logistics for the 12,575 hectare concession are excellent. It is connected by sealed road to tidewater and marine port facilities 40km to the west, owned by the property owner, Juan Paulo Quay, which used the facility for the export of gypsum mined from the Bayovar 12 concession and phosrock from the Bayovar deposit, prior to its acquisition by Vale. Juan Paulo Quay is a marine transport and service provider owned by subsidiaries of Grupo Romero (Peru) and Mamut Andino C.A. (Ecuador). The Pan-American Highway crosses the claim at its eastern end and power transmission lines for the Bayovar Mine, located 15km to the southwest, transect the property at its northern end. "Establishing a foothold in the world-class Bayovar District is another major milestone in our strategy of acquiring quality phosphate assets in South America," said David Cass, the President of Focus. "Bayovar is one of the world's premier phosphate producing regions and benefits from excellent logistics and infrastructure, with two world-class deposits found there to date including a producing mine. We regard Bayovar 12 as a key asset that we can advance quickly to resource stage, and with our other recently acquired projects, firmly establishes Focus as a major name in Latin American phosphates." Five historical exploration holes drilled within the former gypsum operations and spaced approximately 1.5 km apart all intersected multiple flat-lying phosphate beds from 36.5m depth which assayed between 10 - 22% P205. The phosphate intervals were broadly correlated from hole to hole into at least 6 main units within a sequence of diatomite some 30 -- 40m in thickness. The geology and mineralization are similar to the Bayovar Mine and adjacent Fosfatos del Pacifico deposit (Hochschild / Mitsubishi / Zuari). Under the terms of the LOI, Focus can earn a 70% interest in the claim by investing up to $15 million in exploration and making a series of cash payments up to the completion of a positive Pre-feasibility study, after which Focus will have the first right of refusal to purchase the remaining 30% from the property owners. More information is available on the Focus website: www.focusventuresltd.com

Turmoil in potash is an opportunity to Vale

Turmoil in the global potash market is creating an opportunity for Vale SA to buy assets at a discount as the mining company leads Brazil’s bid to become self-sufficient in crop nutrients.
Vale, whose output at Brazil’s only potash mine dropped for the past three years, should abandon plans for greenfield projects and consider instead purchasing existing producers or their assets, according to Stifel Nicolaus & Co. Potash companies are trading at a “great discount,” making acquisitions a cheaper option for Vale than starting from scratch, said Terence Ortslan, managing director of research firm TSO & Associates.
Vale suspended two potash projects in Argentina and Canada worth $8.9 billion in the past year as cost increases made the ventures unfeasible. Fertilizer producer shares have slumped 14% on average since July 30 when OAO Uralkali ended output restrictions through a venture with Belaruskali, triggering speculation prices would tumble. Their average price-to-book ratio fell to 1.69 yesterday from 2.55 at the end of last year.
“It’s tough to justify the economics of a new project at today’s pricing,” Stifel Nicolaus analyst Paul Massoud said by telephone from Washington. “Looking at more established producers, if they can get the balance sheet to work, is the right way to go.”

Fertilizer Losses
Vale isn’t changing its strategy of seeking low-cost potash projects and maintains the business among its five main areas of focus, Chief Executive Officer Murilo Ferreira said during a conference call Aug. 8. While taking a cautious approach, the company is actively looking at potash growth options, head of fertilizers and coal Roger Downey said on the same call. Roberto Moretzsohn, commercial director for fertilizers, echoed those comments in Sao Paulo yesterday.
Fertilizers generated a net loss for the Rio de Janeiro- based company in the three quarters through June 30, according to data compiled by Bloomberg. Vale produced 233,000 metric tons of potash from its Taquari-Vassouras mine in northeastern Brazil in the first half of the year, 5.3% less than the previous year. It’s targeting 550,000 tons this year, similar to last year and 23% below a 2009 record.
Shares of Vale dropped 21% this year, underperforming rivals BHP Billiton Ltd., the world’s biggest miner, Rio Tinto Group and Anglo American Plc. An even steeper slide by potash producers makes an acquisition a more attractive option than spending years on new projects, TSO’s Ortslan said.

Import Dependent

“I would go with buying an existing producer,” he said by telephone. “I am sure it would be a serious consultation in any major company because you have seen a major drop in the market cap of the companies.”
Vale’s press department in Rio declined to comment further on potash expansion plans.
Brazil, the world’s largest producer of coffee and sugar, has said that boosting potash output is a priority to help reduce its dependence on imported nutrients. Amid record crops, Brazil boosted imports of potassium chloride to $1.65 billion in the first half, 20% more than a year earlier, according to the Development, Industry and Trade Ministry.
Brazil spent $8.58 billion in fertilizer purchases last year, its sixth-most imported item. Latin America’s largest economy imports more than 90% of its potash needs and 75% of its nitrogen-based fertilizers supplies, according to industry association ANDA.

Brazil Discount

“No potash project in Brazil is competitive now, and things tend to get even more difficult after Uralkali’s decision,” Mario Barbosa, who headed Vale’s fertilizers businesses until 2011, told reporters in Sao Paulo yesterday. “Potash prices have slumped and will continue dropping.”
Soc. Quimica & Minera de Chile SA, Latin America’s biggest fertilizer producer, is in talks to sell potash in Brazil for as much as a 10% discount on July prices, said two people with direct knowledge of the process. Plant Bem Fertilizantes SA, based in the southern farming state of Parana, may pay SQM $375 to $380 a ton for a 15,000-ton shipment, from $400 to $415 last month, said one of the people, who asked not to be identified because the talks are private. Vale should focus on delivering the heavy investments needed to expand its iron-ore business rather than making additional acquisitions, Oliver Leyland, who helps manage Brazilian stocks including Vale shares at Mirae Asset Global Investments, said by phone from Sao Paulo. “Nobody incorporates any expectation of increasing valuation in potash in the fair value of Vale shares,” he said.
‘Reassess Strategy’

Moretzsohn told an event in Sao Paulo yesterday that Vale will press on with its potash projects as it assesses the impact of Uralkali’s decision. The company should rethink that strategy as average annual prices are headed for another 11% drop next year, Stifel Nicolaus’ Massoud said.
“If they are serious about their claim of wanting to become a big, major fertilizers producer, they are going to have to do something about potash,” he said. “I just don’t think that building is the way to do it.”
www.bloomberg.com

Brazil's Vale says signs accord to quit Argentine Potash project

April 26, 2013|Sabrina Lorenzi | Reuters

RIO DE JANEIRO (Reuters) - Global miner Vale SA signed an agreement with the Argentine government on Friday that will allow the Brazilian company to leave the $6 billion Rio Colorado potash mining project, a company spokeswoman told Reuters on Friday. The agreement could put an end to months of uncertainty for Vale , which suspended work on the fertilizer project in December and announced its intention to pull out in March.
Under the terms of the agreement, Vale's existing concession at the mine remains in place for up to four years, the spokeswoman said. In the meantime, Vale is free to seek a buyer or partner for the venture.
Between December and March, Vale sought and failed to get the Argentine government to approve tax breaks to help ease rising costs related to surging Argentine inflation and the country's tightly controlled official exchange rate.
Vale said the inflation and exchange rate could make the project unviable.
People familiar with Vale's plans have said the company, the world's second-biggest miner, planned to sell the project in efforts to recoup the $2.2 billion it has already spent on the mine and on railway and port improvements needed to move the potash to market.
In a conference call with analysts and investors on Thursday, Vale said it is seeking new potash projects in Brazil and abroad to replace the Rio Colorado project.
Since approving plans to pull out and seek a buyer for the project, Vale and the Argentine government have been at loggerheads over the fate of at least 6,500 jobs at the Rio Colorado site.
Despite the suspension, an Argentine court ordered Vale to maintain work sites and continue paying its workers.
Brazilian president Dilma Rousseff said on Thursday, after meeting with Argentine President Cristina Fernandez in Buenos Aires, that she was confident Vale and Argentina would come to an agreement.
The Rio Colorado project includes an 800-km (500-mile) rail line from the mine in Mendoza province to Bahia Blanca, an Atlantic Ocean port.
Potash, a potassium salt, is a key fertilizer and is considered a strategic product for Brazil. While it is the world's largest producer of coffee, orange juice, sugar and beef and the No. 2 exporter of soybeans, Brazil must import the vast bulk of its fertilizers, including about 90 percent of its potash.
Potassium is one of three key plant nutrients along with nitrogen and phosphorous.
(Reporting by Sabrina Lorenzi.; Writing by Jeb Blount; Editing by Gary Hill and Lisa Shumaker)

A Copebrás é parte do Anglo American

Fosfato e Nióbio
Integram a Anglo American Nióbio Brasil (Ouvidor e Catalão/GO), que produz nióbio desde 1976, e a Anglo American Fosfatos Brasil (Ouvidor e Catalão/GO, Cubatão/SP), fundada em 1955, que fabrica produtos fosfatados, especialmente fertilizantes e insumos para alimentação animal.
No Brasil ainda integram o Anglo American os Negócios de Minério de Ferro e Níquel. Fosfatos tem o Ruben Fernandes (ex Vale e Votorantin) como o atual CEO.

Algérie - 6,5 millions de tonnes de phosphates en 2016 et complexe a Tébessa

La production annuelle de phosphate brut atteindra, dans la wilaya de Tébessa (est algérien), 6,5 millions de tonnes en 2016, soit "plus du triple de la production actuelle", a affirmé le directeur général de la Société des mines et phosphate (Somiphos). Une importante partie de cette production, soit 4,5 millions de tonnes, sera transformée en acide phosphorique (un acide minéral obtenu par traitement du minerai de phosphate) dans une usine en cours de lancement dans la région d’Oued El-Kebrit (Souk-Ahras). Le reste est destiné à l'exportation et à la satisfaction des besoins locaux, a ajouté le directeur général, Noureddine Zaïdi, dont l’entreprise relève du groupe public Ferphos.

Mosaic Seeks Bidders for Operations in Argentina and Chile

Mosaic Co. (MOS), the world’s largest phosphate-fertilizer producer, is selling its Argentina and Chile operations, a company spokesman said. “After significant evaluation and review, Mosaic has decided to pursue a sale of our operations,” Rob Litt, a Mosaic spokesman, said in an e-mailed statement today in response to Bloomberg questions. “We will immediately begin preparations for a sale process and will work quickly to complete a transaction.” Litt declined to comment on reasons for the sale in a telephone interview from Plymouth, Minnesota. He also declined to confirm that the unit on the sales block produces 550,000 tons a year of fertilizer, employs 130 workers and has annual sales of $300 million, as reported earlier today by the Buenos Aires-based newspaper La Nacion. “It is clear Mosaic’s strategic plans are in a different part of the world,” Pablo Bussetti, president of the producers association called Fertilizar, said in a telephone interview from Bahia Blanca, Argentina. “They are the largest producers of phosphate in Argentina, with more than half of the market share, and I am sure they will receive many offers.” Mosaic produces phosphate north of Buenos Aires in a factory near Rosario, Argentina, and handles distribution from Chile. Mosaic agreed Oct. 28 to acquire a mine and other assets from CF Industries Inc. for $1.2 billion to boost its output of the crop nutrient in Florida.