I-MAG STS    Corporation - Western Sahara

As you may be aware, there really is no substitute for phosphates in agriculture, but there is not any sign of an imminent shortage of phosphate rock. In 2016 the largest producer of phosphates was China at 138,000 tons. If true, that would be about half the world's production. Our United States produced 27,800 tons while Morocco and Western Sahara combined produced 30,000 tons (up from 29,000 tons in 2015). Last we heard, the project to double the phosphate production in Morocco and Western Sahara was due to be completed in 2020. 

You would rate to be more successful than we were at asking the United States Geological Survey to distinguish between phosphates from Morocco proper versus from Western Sahara. We should mention that phosphate production (or at least its reporting) in Syria and Iraq has been low to non-existent due to the fighting. We would expect phosphate prices to decline as new mines in Algeria, Brazil, Jordan, Egypt, Peru, Senegal, Russia and Kazakhstan come on line. In the United States the bulk of phosphates are mined in Florida and North Carolina with some mines in Utah and Idaho. Prices average $75 per ton. The United States now imports about two thousand tons with about 40% from Morocco and the remainder from Peru.

We have not been able to determine how profitable Western Sahara phosphate mining is for Morocco. Were we obliged to guess, we would estimate one-sixth of Morocco's phosphate production comes from Western Sahara. The Moroccan phosphate rock benchmark had been flat at $US 132 per ton since Q2 2015 but declined to $103 in Q3 2016. It would be reasonable to estimate a gross margin percentage of 35% for Morocco so we would think $200,000,000 profit per year recently for Western Sahara phosphates. We would think that not very much money for the misery it causes.

  Prior Home