In the past five years, the food supply chain has grappled with a dizzying series of shocks from a global pandemic to Russia's invasion of Ukraine, Trump's trade war, and conflict in the Persian Gulf, where a narrow strip of water is now holding the world's economy hostage. Against this backdrop, food security has rapidly moved up the agenda, says Mayo Schmidt, a former president and CEO at fertilizer giant Nutrien, who is now leading efforts to build a potash mining operation in Brazil as executive chairman at Brazil Potash.
The business case is clear, he says. A global agricultural powerhouse, Brazil accounts for almost a quarter (22%) of global demand for potash, which supplies crops with potassium. But it is reliant on imports for a whopping 98% of its needs, despite sitting on one of the world's largest undeveloped potash basins in its own backyard.
Toronto-based Brazil Potash—which is raising funds to mine a potash basin in northwest Brazil—is designed to reduce this reliance, providing Brazil's farmers with lower-cost potash transported on barges via an inland river system in partnership with ag commodities giant Amaggi.
"First, the global potash market is highly concentrated today," says Schmidt. "There are three [leading] suppliers [Nutrien, Mosaic, Belaruskali], and they operate through trading agencies. So fundamentally, you have two sellers [Canpotex and the Belarusian Potash Company], which creates oligopoly pricing power. Second, if you're in Brazil, it takes 107 days from origin [from, say, Canada] to get to market."
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