Phosphate: The Commodity That Feeds Half the World Is On the Brink

Phosphate: The Commodity That Feeds Half the World Is On the Brink

Phosphate is the one ingredient in global food production that cannot be synthesised. In the past 18 months, the three largest supply sources have all broken at once. China has banned most fertiliser exports. US production has halved over 25 years and just landed on the USGS Critical Minerals list. Russia remains sanctioned. The Strait of Hormuz has throttled Gulf supply, with five Hormuz-exposed countries accounting for 23% of global ammonia trade and 18% of MAP/DAP trade. If nitrogen markets look bad right now, phosphate is worse.

PhosCo Ltd (ASX: PHO) holds 146.4Mt at 20.6% P₂O₅ in Tunisia, with a 2022 scoping study showing US$657M NPV and a 54% IRR on a US$150/t price deck that now looks conservative. Since then, drilling has collapsed the strip ratio from 3.5:1 to 1:1 at the prospect next to the planned plant, a new discovery was made at the DOH prospect in March, and the EBRD has backed the project with a €1M cash grant plus a A$7.5M investment option triggered off the updated scoping study due in Q2.

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