BHP’s report today will be sentient imo. Touted is that will use the report to announce also moves into potash- away from traditional metals , coupled with their oil and gas divestment to Woodside- green credentials and future looking coming from BHP!
But BHP’s moves will be highly important for potash prices medium term & through the next decade and decades.
Demand for potash, and fertilisers is expected to
double — potassium is an absolute necessity for plants, therefore for cropping and increasing yields and quality with ever less water use. Potash, and esp Australian new industry potash as will be higher quality, for food production. (as opposed to cereals although if production really ramps up locally with SOP, end-users may make their own arrangements to buy or pickup product directly from producer or location and truck directly imo to the farmers and to farming region where higher value costs for SOP over MOP then will not exist. Without doubt SOP is better for
all crop yields and would improve the sometimes salty soil in broadacre WA arable farming regions. )
*SOP is usually made in a very unenvironmentally friendly, high acid waste producing manner . eg. in China and elsewhere in the world at the moment.
*Aust potash producers are going to produce SOP directly from the brine acquirers.
Re - MOP:
BHP - are preparing to spend huge billions to develop the underground MOP mine in (Ontario ?) Canada. I’m sure the Canadian government is supportive , but a $7.6 billion project abouts ?
Imo shp should be on their radar in the heart of Europe where locals are wanting the reopening of potash mining after over 25 years closure since with low commodity prices the then new unified western German Govt closed their MOP mines by the mid-1990s putting tens of thousands of people at the time out of work.
Re- SOP :
SOP is superior.
But - this is a brand
new industry in Australia.
I do not know this company here but do not doubt the sincerity of the teams seeking to develop good projects.
There was a good lunchtime presentation in Perth by all of the WA aspiring projects, late last year I think?
Plenty on YouTube to see.
**There is a LOT to know & learn with what ‘looks like’ a simple, wonderful commodity which is highly needed in the world. **
Yesterday afternoon I watched the SO4 presentation to Diggers and Dealers (note - 2020 I then realised,.. as I was surprised at the upbeat tone !)
It came up in my watch list for in the car and I was and I very much wanted to watch
I have watched many potash presentations this year— mostly Kallium lakes ( which I first invested in ~60c area and thankfully got cold feet on before issues during developement stage with the first German engineering arose! )
Since then I’ve paid more attention!
Reinvested late last year and this year, but it’s slow and longterm.
Nothing wrong with slower and very careful! & longterm, and even boring —but
competent management who measure everything more than twice and recheck everything again and monitoring always along the way!
But anyone looking into Australian potash developements, here too- truly the SO4 presentation, from 2020 D&D is almost “must viewing” . It is a reminder to all new Australian potash producers to not cut any corners and to employ the very best engineering and industrial chemistry etc companies and other teams and people possible. Learn from each other!
KLL also learned the hard way.
Some backbone shareholders been in since the 60c days and supported the eventual 12-14c recapitalisation raise, for an average buy- in price of about 31-32c for one large Kallium holder who uses the same broker that I do. He has waited a long time to probably be in the money finally in the next 6 months.
Warning - that SO4 is practically now in the hands of receivers due to cost over- runs and ‘glitches’ , many glitches before the final finish line ..to say the least!
These projects cannot be rushed it seems.
They’re not going to be sexy. Although it is amazing to watch the developments.
Kallium lakes latest videos are excellent viewing. Websites are good for information.
I’ll look up Aust Potash but there’s so much more to it.
All will be unique.
Eg. KLL is further inland than where SO4 was? ( SO4 therefore less transport costs )
But KLL then will have less disruptive rainfall events from the odd cyclones. Transport of final bagged SOP fertiliser is an Achilles heel now as Kallium lakes moves into commissioning in the next month and gradual ramp up- shortages of drivers and trucks in WA and they need best co- ordinate with empty trucks doing equipment supply runs out from ports to nearby other mining companies.
They have over a years worth of salts stockpiled ready to go though too. SO4 ceo was all talk, so much impressive wonderful talk and setting up the project, “with momentum “- but it’s so much more & what they’re doing has never been done quite like will be done here in Oz.
Ultimately there were warning bells about the SO4 engineering system ( they just contracted an engineering firm to “do” everything, including formulating their solutions to every task/ problem. )
KLL have significant german investment and the plant is an exact of not only their pilot plant ( pilot plants can be made to work - but at large scale can still not be so streamlined or successful) , but exact huge plants which are already successfully doing the production elsewhere in the world - with the exact same engineers in charge who have commissioned and got operations going elsewhere in the world also.
*There might be some cheap partly established projects get picked up by the established producers .. not too far down the road. (SO4 if can’t keep going and suffer dilution & raise the money required. And they need a thorough independent review maybe )
No shareholders would want to go through what KLL briefly and now SO4 shareholders have.
Monitoring closely & probable for takeover activity of main good projects in Oz , once they’re up and going - Wesfarmers and Incitec Pivot. (I bought a few IPL last week on news the supply constraints with potash as China has put a halt on their countries exports . China had been no1 supplier of MOP to Australia & exporter to the world and potash prices risen also in China and costs risen too- so the Govt has put a stop to exports to maintain own agricultural costs and output)
Hope helpful. Very much want to see what BHP doing today wrt potash development. ( I’m not a holder !)
By far and away my no 1 is biotech and my main holding with you. But I also have whole of life direct agricultural background as well as health and health science.
Hence my interest in potash & agricultural companies too somewhat . Thanks and best to all
@EW.
(20min delay)