Harvest Minerals Limited (LON:HMI) has begun work on a trial licence application as it completed initial drilling on its Maximus prospect - part of its Arapua fertilizer project in Brazil.
The results of 25 air core holes were in line with the potash firm's estimates for tonnage and grade, it said.
Significantly, the findings also highlighted calcium oxide (CaO) and magnesium oxide (MgO) grades of more than 5%, which potentially increases the value as a multi-nutrient direct application fertilizer, known as a DANF product.
Harvest has identified significant demand for such a product, within short trucking distances from Arapua with over 1.8 million hectares of cultivated land within 200km of the project.
Executive chairman Brian McMaster said: "Since receiving the proceeds of our recent funding in January, we have been steadily going through the steps to develop Arapua into a low cost commercial project producing DANF for the local market.
"Harvest has only drilled a small area of the project, but which should provide enough material to support the proposed initial period of trial mining. We also only targeted the weathered mineralization, which will be easier and more cost efficient to extract.
"The next steps are to scope the commercial viability of the project to produce a multi-nutrient direct application natural fertilizer, and scope a resource in line with a trial mining license to provide sufficient product to potential clients."
"The resource consultants are on site this week and samples are currently being prepared for the metallurgical test work, with the results of both expected in late June.
"In anticipation of this, we have also commenced work for the lodgment of our Trial Mining License, which we also expect to lodge in late June."
Following the January fundraise, the group began exploration and pre-development at its Mandacaru and its Arapua/Maximus projects in Minas Gerais State, Brazil
Around 90% of Brazil’s potash is currently imported, making it the most prolific importer of potash in the world.
Mirabaud has estimated that Harvest could produce 100ktpa under a trial mining permit.
Shares dropped over 22% in London to stand at 5.125p.