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1 MORE REASON TO ADD HARVEST MINERALS #HMI TO YOUR WATCHLIST

The content of this blog (or content associated with it) is not intended as investment advice. The author holds an interest in the company mentioned. Please do your own research.

HARVEST MINERALS #HMI
Share Price: 13.7P
Market Capitalisation: £17.65M


Harvest Minerals is a Brazilian focused fertiliser Company targeting low cost, near term development projects. The Company’s current focus is the development of its 100% owned Arapua Fertiliser Project from which it produces its KPfértil product, a proven, multi-nutrient, slow release, organic fertiliser and remineraliser, which is produced from a weathered potassium and phosphate rich lava and offers many economic and agronomic benefits.

To read my previous blog on Harvest Minerals #HMI

1 MORE REASON TO ADD HARVEST MINERALS #HMI TO YOUR WATCHLIST

Leach Test Results See KPfértil Dramatically Outperform Traditional Products for Potassium Retention

On 22nd November Harvest Minerals released the results of leach tests, for their product, KPfértil.

“The test results demonstrate the superior behaviour of KPfértil over other traditional sources of potassium”.

To explain, the leach test results were done to see how much of the contained potassium, in the product, is lost from the soil after watering them for 18 days.

The bigger the loss, the less effective the product.

The results were as follows:

Only 0.07% of the contained potassium provided by KPfértil was lost from the soil due to leaching compared to 20.8% of the contained potassium lost due to leaching from conventional sources including potassium chloride, 19.2% from potassium sulphate and 21% from potassium Nitrate.

This is a massive win for KPfértil.

Results will be used in certification process of KPfértil as a remineraliser by the Brazilian Ministry of Agriculture, Livestock and Supply (‘MAPA’)

Harvest’s Executive Chairman, Brian McMaster, said, “These leach test results are fantastic, supporting previous agronomic testwork, which has also exceeded our expectations, and demonstrates that KPfértil works as both a fertiliser and a remineraliser. Importantly, the results indicate that unlike traditional sources of potassium, KPfértil can be applied in a single dose as the potassium will not be leached away before it can be used by the plants. Secondly, as the nutrients are not lost, there is likely to be a strong residual effect, supporting our view that KPfértil is an excellent slow-release fertiliser. As well as providing additional support for our remineralisation application with MAPA, these results assist in our marketing of KPfértil to potential customers, which continues to gain traction.”

Harvest Minerals has submitted an application to register, KPfértil, as a remineraliser to the Brazilian Ministry of Agriculture, Livestock and Supply. The application is expected to be approved by the end of the year. Although a broker note out this week suggested certification wouldn’t be until Q1 of 2018, which knocked the share price a little. I asked Brian about this and he said, its completely up to the ministry but he was still expecting / hoping the decision would be before year end.

When this application is approved Harvest Minerals can sell their product in a country that imports 90% of it’s potash and 51% of
it’s phosphate.

Why do I state, “when” the application is approved rather than, “if”?

Firstly, As I mentioned above, Brazil has a massive demand for fertilser and yet it’s mostly imported.

Harvest Minerals’ product, KPfértil is:

– Natural
– Not an import
– Works better than imports
– Is cheaper than imports

Add to this the fact that the Brazilian government want the country to be self sufficient in fertilizer production by 2020 and they can hardly afford to turn down Harvest Minerals, if they want to get anywhere near their targets.

I should also mention that the economics of the project also stack up extremely well.

Harvest Minerals have a 13 million tonne resource, based on drilling only 6.7% of the known mineralisation, and can mine up to around 450,000 tonnes per annum, which translates into a current mine life of over 100 years.

The all in cost of production is below $10 per tonne and sales price is $60 per tonne. So based on 450,000 tonnes of sales per year sees them generating $22.5m in free cash flow, per year, which is bigger than the current value of the entire company (and they have 3 other projects yet to be realised).

To add Harvest Minerals #HMI to your Vox Markets Watchlist, click here and tap the, “Follow”, button

To listen to my recent interview with Brian McMaster of Harvest Minerals, click below:

The content of this blog (or content associated with it) is not intended as investment advice. The author holds an interest in the company mentioned. Please do your own research.

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Mentioned in this post

HMI
Harvest Minerals Limited (DI)