Brazil Potash secures offtake deal with Keytrade Fertilizantes for 900K tons of fertilizer

[fertilizer in farmer hand. NPK fertilizers are three-component fertilizers providing nitrogen, phosphorus, and potassium]
iamporpla/iStock via Getty Images

Brazil Potash (NYSE:GRO [https://seekingalpha.com/symbol/GRO]) +43% post-market Wednesday after saying it reached a binding agreement [https://seekingalpha.com/pr/20207336-brazil-potash-executes-definitive-offtake-agreement-with-keytrade-fertilizantes-brasil-for] for a 10-year take-or-pay commitment for Keytrade Fertilizantes Brasil to purchase up to ~900K tons/year of potash, finalizing a memorandum of understanding announced in January.

Keytrade, one of the world's leading fertilizer trading companies, will purchase 30%-37% of Brazil Potash's (NYSE:GRO [https://seekingalpha.com/symbol/GRO]) annual potash production up to a maximum of 900K tons/year on a take-or-pay basis from the company's Autazes project.

Brazil Potash (NYSE:GRO [https://seekingalpha.com/symbol/GRO]) said it has secured binding offtake agreements covering ~60% of planned production, and is in advanced discussions with a prospective partner that would increase total volumes to ~91% of annual capacity.

"This agreement with Keytrade is a major milestone in Brazil Potash's commercial development," CEO Matt Simpson said, adding that the company now has binding commitments for ~1.45M tons of planned ~2.4M tons of annual production.

MORE ON BRAZIL POTASH

* Financial information for Brazil Potash [https://seekingalpha.com/symbol/GRO/income-statement]