EuroChem Group AG achieved some 8.8 million mt/y in installed and operating fertilizer production capacity in Brazil in August and aims to reach a capacity of 10 million mt/y by 2025, according to Brazilian news outlet Valor International, citing an interview with Gustavo Horbach, EuroChem’s new Head of South America.
Construction of EuroChem’s latest project in the region, the Serra do Salitre mineral industrial complex in Brazil’s southeastern Minas Gerais state, is 85% complete. According to Horbach, part of the new plant is already in operation with full operations expected to start in early January or February 2024, depending on the receipt of some supplies.
The new facility will have a production capacity of 1 million mt/y of phosphate fertilizers comprising MAP/NP and SSP/TSP products, with the officially inauguration tentatively scheduled for April 15, 2024. According to Horbach, once fully ramped up, the facility will meet some 15% of Brazilian demand for phosphate fertilizers.
The project also includes a sulfuric acid unit and a phosphoric acid plant, as well as a 0.4 million mt storage facility for granulated fertilizer, including urea and potash.
EuroChem bought the Serra do Salitre project from Yara International ASA in 2021, when the project was 50% complete. EuroChem paid a cash consideration of some $410 million for the Serra do Salitre phosphate assets (GM Aug. 6, 2021). Horbach put the total capex for the project at $1 billion.
The acquired assets also included operating phosphate mining operations at an open pit, including a tailings dam, with an annual production capacity of approximately 1.2 million mt/y of phosphate rock. The mine has more than 350 million mt of reserves.
The group said the acquisition expansion has allowed EuroChem to reduce its dependency on third-party phosphate supplies, and also creates the potential for phosphates and complex fertilizer production in Brazil.
EuroChem’s other fertilizer assets in Brazil include a controlling stake (79.98%) in Fertilizantes Heringer SA., and, since August 2020, full ownership of Brazilian fertilizer blender and distributor Fertilizantes Tocantins (FTO) (GM Aug. 21, 2020).
EuroChem acquired an additional tranche of shares equivalent to 28.49% in Fertilizantes Heringer in late June (GM June 30, p. 26), paying around R$230 million (approximately $47.6 million at that time). It bought an initial 51.48% stake in the Brazilian company last year (GM April 1, 2022) for R$554 million, and in December launched a second public offering for the remaining minority shares (GM Jan. 6, p. 27).
Since acquiring its initial 50%-plus-one share in FTO in 2016 (GM July 8, 2016), EuroChem has added three new fertilizer blending plants to the six that were already part of the Brazilian company’s portfolio.