Brazil’s privately-held fertilizer company, Galvani Fertilizantes, Sao Paulo, recently gave an update on two major fertilizer projects (GM May 13, p. 36), saying it expects to spend R$2.5 billion ($482 million).
The company expects to spend R$200 million ($38.6 million) at its plant in Luis Eduardo Magalhães in Bahia state to double production to 1.2 million mt/y by 2024. In an interview with Bloomberg, Galvani CEO Marcos Stelzer said the value will come from equity contributed by the Galvani family.
Some R$2.3 billion ($443 million) will be invested at the Santa Quitéria phosphate-uranium project (GM Oct. 19, 2018) in Ceara. The amount will be a combination of Galvani equity, issuance of debt, and the share of a stake in the project, though the latter will not include an independent public offering (IPO).
When brought online, the Santa Quitéria project would produce 1.05 million mt/y of phosphate, which would serve the Matopiba region. In addition, the project is expected to produce 220,000 mt/y of dicalcium phosphate for the feed industry, which Galvani said represents 50% of all demand in the North and Northeast regions and 22% of national demand.
The Santa Quitéria project, which is expected up in 2026, is being carried out in partnership with Industrias Nucleares Brasileiras (INB), a state-owned company. Uranium production of an estimated 2,300 mt/y, which will be separated from the phosphate, would go to INB. The mine is currently in the environmental licensing phase.
Together, the two projects will boost Galvani’s fertilizer output to 2.2 million mt in 2026, up from 600,000 mt in 2021. That would represent more than one-third of the nation’s current phosphate output.
In addition to these two projects, Galvani said it also plans to start exploring for a phosphate mine in Irecê in Bahai. Phosphate from this project would be transported to the Luis Eduardo Magalhães unit, with the end product then shipped through the port of Pecem in Ceara. The total investment for this project is put at R$340 million ($65.6 million), which will come from Galvani’s own capital.
The Galvani family retained the production unit in Luis Eduardo Magalhães and the mining units in Angico dos Dias and Irecê, as well as the Santa Quitéria project, when it sold its minority stake in Galvani Indústria to Yara International ASA, Oslo, in 2018. The Galvani retained assets were valued at US$95 million as of Aug. 31, 2018.
According to Brazil’s Ministry of Agriculture, 85% of the fertilizers used in Brazil are imported. The National Fertilizer Plan, launched by the federal government earlier this year, aims to reduce Brazil’s dependence on imported products to 45% by 2030.