Global food shortages; increased world population and urbanization; destructive natural disasters like unprecedented floods that wipe away hundreds of thousands of acres of farmland—all headlines on the six o’clock news. The mounting pressure on farmers to grow more food on less land is starting to become unmanageable in selected parts of the world. Food producers are desperate to find new fertilizers and methods that will boost their crop yields. This global need shows no sign of easing off. A failure to meet this growing demand is virtually unimaginable.

The ‘Father of Fertilizer’ German chemist Justus von Leibig was right on the mark in the 19th century when he stated that inorganic materials were the vital forces behind healthy crops. Today, his comments can be rephrased as “feed the crops so the crops can feed the world.” The spotlight is starting to get quite a bit brighter on companies that will be able to provide effective fertilizers and their practical importance is growing as is their market value. One just has to look at how the world media has focused their energies on exploring the multi-billion dollar mergers and attempted takeovers in the potash industry. Australia’s BHP Billiton’s failed pursuit of Canada`s Potash Corp. made investors sit up and begin to take notice. And the recent union of Russian potash giant Uralkali with Silvinit effectively created the second largest potash corporation in the world.

Yes, there definitely is a buzz in the market, and given the macro-dynamics at play, the demand for fertilizer – and the companies who produce it – isn’t likely to end anytime soon. Rather, we may now be witnessing just the start of the ride. With this as a backdrop, we would like to introduce you to our newest client, IC Potash Corp.

A premium product

IC Potash plans to be a leading producer of sulfate of potash (SOP) fertilizer. This premium potash contains lower amounts of chloride than regular potash, giving it a distinct market advantage. SOP is gentler on leaf-bearing crops, such as fruit and vegetables, and is particularly effective in dry or saline soils, such as those in China and India. For these and several other reasons, this specialty fertilizer is in high demand and it sells for a 50% premium over regular potash.

The future is very bright for SOP even though regular potash currently accounts for 89% of world potash fertilizer consumption and SOP only accounts for 10%. The long-term growth rate of SOP sales is expected to rise by 3% to 4% which represents 200,000 to 250,000 tons per year. SOP is even predicted to experience the strongest growth of all fertilizer products. Plus, as it is sheltered from volatile production costs it has a more stable pricing outlook than regular potash.

IC Potash is building its infrastructure and processing models to be the lowest-cost producer of SOP fertilizer. To accomplish this, the company will be utilizing the most inexpensive method of manufacturing in the industry. Their mining site in New Mexico – which is the birthplace of the US potash industry – turns polyhalite ore into three different forms of SOP that can be customized to soil and crop conditions.

IC Potash holds 21 federal sub-surface polyhalite prospecting permits in southeast New Mexico. This site, named The Ochoa Project, covers over 113,000 acres and is 100% owned by the company. ICP’s neighbours, The Mosaic Company and Intrepid Potash, are dominant players in this industry as well. The company released good news on January 17, 2011 relating to a NI 43-101-compliant preliminary economic assessment. ICP’s base production level is expected to be 660,000 tons per year, with their operating costs projected to be $164 per ton. The company’s capital costs to bring the project fully into production are planned to be $662 million.

Good for everyone

IC Potash doesn’t just mine a first-rate product; it employs first-rate people. CEO Sidney Himmel is a former investment banker, specializing in mining companies. CFO Kevin Strong was previously a regional manager of the TSX Venture Exchange. COO Randy Foote has 27 years of experience in the U.S. potash industry, and their chief exploration and development officer, Patrick Okita, holds a PhD in geology. Dr. Okita has previously worked with BHP Billiton and the U.S. Geological Survey while Mr. Foote has held positions with Intrepid Potash.

Not only is SOP good for farmers but investors seem to be benefiting as well. Aside from these two benefactors, SOP can lay claim to also being good for the average person. Yes, this is a bold claim, but true; regular potash only contains potassium while SOP contains both potassium and sulfur. Food fertilized with SOP contains high levels of these two important nutrients which are beneficial to human health. Fruits, vegetables, grains and nuts are all good sources of these elements. And they also happen to be good for a healthy heart and body.

Now more than ever before, finding the right fertilizer to help farmers is essential to our world’s population state of health. IC Potash is poised to be a major player in the potassium fertilizer industry. And when that happens, it will mean more nutritious and delicious food on kitchen tables around the world.