Encanto Potash Corp. (CVE:EPO) on Wednesday announced the finalization of a blockbuster agreement with India’s national farmers co-operative to supply a minimum of 5 million tonnes of potash per year for the next twenty years.
Vancouver-based Encanto’s is advancing a $2.9 billion potash project in the Saskatchewan province of Canada in a joint venture with the Muskowekwan First Nation.
Encanto President Stavros Daskos said the deal is “clearly a defining moment for our company and the industry. India imports 100% of its potash and is susceptible to cartel-like practices from producers that can hurt its national food security.”
NACOF was established under the Indian ministry of agriculture and represents farmers in 25 out of 29 states across the subcontinent. India is home to some 55 million small scale farmers and NACOF boasts an annual budget of $7.7 billion according to a statement.
The country imports roughly 6 million tonnes of muriate of potash a year, a substantial portion of a global industry for the crop nutrient of roughly 50 million to 60 million tonnes. The potash price has been under pressure since 2011 and fell sharply last year ending 2016 at $215 a tonne. MOP prices peaked in 2009 shy of $900 a tonne.
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