The next phase includes a floatation process that coats the phosphate particles with a hydrocarbon, allowing them to float to the surface for further separation.The marketable product that companies reference is this beneficiated phosphate rock, whose phosphorus pentoxide (P2O5) content is suitable for phosphoric acid or elemental phosphorus production. This product is often upgraded into granular diammonium and monoammonium phosphate (DAP and MAP, respectively), which is a high-grade, water-soluable fertilizer that can be applied to crops. Single super phosphate is a cheaper alternative to the popular DAP and is obtained through a chemical reaction between rock phosphate and sulphuric acid. Like potash, phosphate is unevenly distributed globally, placing a large and growing amount of control onto a select number of markets. Morocco is home to 85 percent of global reserves, with smaller but significant reserves in the US, Canada, China and a number of other Middle Eastern and North African countries. Phosphate is typically sold by the tonne in agreements signed between suppliers and consumers either through defined contracts or through spot markets. China and India are important players in determining where contract prices will settle and what impact growing demand will have in the market. Potash Potash is a potassium-based product that is often bonded to other chemicals to make it stable in normal conditions. Its name comes from the potash production process, whereby wood ashes are leached in iron pots: pot-ash. Today, potash has become shorthand for a variety of water-soluble potassium salts and is predominantly used as a fertilizer nutrient to encourage water retention in plants, increase yield, improve taste and help plants resist disease. Today, the extraction and refinement of potash products is more complex as companies focus on ancient underground oceans of potassium salts that are often located hundreds of feet or more below the surface; these are mined as potash ore.
Extraction of potash ore is done through two methods. Conventional underground mining is where ore is dug out by large machines and transported to the surface. This method is expensive, but is also the most common. Solution mining is less common and uses hot brine (salt water solution) injected below the surface onto the ore body and then pumps the potash brine solution back to the surface for cooling and separation on surface ponds.Ore bodies are typically graded by the percentage and tonnage of potassium oxide (K2O) and typically KCl (potassium chloride, or muriate of potassium). Both the more pure potassium form and a water soluable form of potassium, typically potassium chloride (KCl), potassium sulphate (K2SO4 or suplhate of potash, SOP) or potassium carbonate (K2CO3) are listed depending on the source to give investors an indication of the amount of potassium for use in fertilizer. Predominant potash ore varieties are split into either sylvinite or carnallite resources, two types which occur most commonly. Sylvinite is a mixture of KCl and table salt (NaCl) while carnallite is KMgCl3•6(H2O) or potassium magnesium chloride plus water. As a result, sylvinite is typically valued higher than carnallite as it requires less energy to separate the KCl in sylvanite than it does to separate the magnesium in carnallite. However, both potash formations are currently economically viable resources. Like phosphate, potash is typically sold by the tonne in agreements signed between suppliers and consumers either through defined contracts or through spot markets. Again, the booming Asian economies of China and India are critical players in the market and will shape the demand function for a long time to come. Derek Lindsay of Arianne Resources weighs in At the Vancouver Resource Investment Conference last month, Derek Lindsay, CFO of Arianne Resources (TSXV:DAN), provided some insight on the difference between the two chemical nutrients in an interview with the Investing News Network.