bfs due in 6 weeks, page-2

Every chance of a re-rating but not necessarily up.

MAK has said that for the DSO delvelopment to proceed they need signed contract prices above the operating cost - this is not yet a sure thing. No doubt some of todays more informed sellors are concerned about this and the long term supply / demand balance.

"Minemakers will not start a mine until it has contracts in place and can provide justification to the road and rail haulage contractors that they should buy their truck fleet and train sets.

To be prudent we are now planning on mine start up at the end of the second Quarter 2010 rather than at the start of it.

In the meantime, the pace of all evaluation studies is being maintained so that production can be initiated just as soon as the marketing opportunities crystalise"

There are also issues with hydrology "The delay in finding sufficient quantities of water is likely to retard the completion of the feasibility study and EIS by about 4-6 weeks."

An oversupply is also forecast for at least the next 4 years ref below:

http://www.fertilizer.org/ifa/Home-Page/FERTILIZERS-THE-INDUSTRY/Market-outlooks.html
3.2. Phosphate Outlook
Massive Exportable Tonnage of Phosphate Rock by 2012
World phosphate rock capacity is projected at
248 Mt in 2013, representing overall 30%
growth compared with 2008. Several projects
for new mines or capacity expansions by
current producers have been delayed due to
rising costs and delays in integration with new
downstream production. Rock supply is
projected to increase in East Asia, Africa, Latin
America, West Asia and Oceania. About 15 Mt
of rock capacity would be earmarked for
exports. If all projects proceed as scheduled, a
large potential surplus may develop in the
export market in the near term.

For the period 2009 to 2013, the global
phosphoric acid supply/demand balance shows
a sustained surplus ranging between 3.0 Mt
and 3.8 Mt P2O5 p.a. The potential surplus in
2013 is likely to equate to 7% of world supply.

3.3. Potash Outlook
Close to 40 new MAP, DAP and TSP units will
be constructed in ten countries, including 18
units in China. New facilities are planned in
Africa, West Asia, East Asia and Latin America.
The bulk of this expansion will be for DAP
capacity, which is projected to increase about
1.1 Mt P2O5 p.a. during the next five years.
Global demand for processed phosphates is
projected to recover by 2010. The global
supply/demand balance for DAP shows soft
market conditions through 2013, with growing
annual surpluses."