Australian Potash Ltd (ASX:APC)’s premium, high-quality and high-value K-BriteTM Sulphate of Potash (SOP) has been certified as compliant with the Australian Certified Organic Standard 2021.
APC holds SOP tenure across four project areas in Western Australia’s North-Eastern Goldfields, including the pre-development Lake Wells Project.
The company received US and European organic certifications earlier this year, allowing its premium potash product to be used in organic production and food processing in American and European markets.
Following the previous certifications, APC obtained a take-or-pay off-take agreement with HELM USA to the tune of 20,000 tonnes per annum for US markets and another 30,000 tonnes per annum to be distributed to European markets by HELM AG’s European subsidiaries and partners.
Read: Australian Potash’s premium SOP compound gains key US organic certification
These organic designations will allow Australian Potash to leverage its K-BriteTM compound in the lucrative international organic fertiliser market that was already worth US$8.443 billion in 2020 and is expected to grow at a CAGR of 7.92% from 2021 to 2027.
Offtake agreements secured
APC has already secured a take-or-pay offtake agreement with Redox – an Australian chemical and material distributor – for 20,000 tonnes of its organically certified K-BriteTM Potassium Sulphate SOP to be distributed throughout Australia and New Zealand’s diverse agricultural markets.
“We are strategically positioning the Lake Wells sulphate of potash suite of K-BriteTM products to sell into the premium end of global SOP markets,” Australian Potash managing director and CEO Matt Shackleton said.
“We believe that making premium end products that are organically certified and have a high potassium content, and which will be delivered in granulated and bagged forms, gives our shareholders the best opportunity to generate premium margins. Having our products organically certified in the Australian markets is obviously a milestone step in this overall strategy.
“APC has secured offtake agreements for 90% of our forecast annual production, or 150,000 tonnes per annum, across Europe, the US, Australia and New Zealand, China and SE Asia. It is the preference for organic produce in these markets, which generally commands a price premium, that we are targeting with our suite of organically certified K-BriteTM SOP products.”
These regulatory successes follow infrastructural development at APC’s wholly-owned Lake Wells Sulphate of Potash Project in Western Australia, where Australian Potash engaged specialised power provider PWR Hybrid to build, own and operate a 35-megawatt hybrid renewable energy microgrid at its Potash Project.