Strategic Alliance with Major Fertiliser Company

RNS Number : 8035V

Harvest Minerals Limited

26 July 2018

 

Harvest Minerals Limited / Index: LSE / Epic: HMI / Sector: Mining

26^th July 2018

Harvest Minerals Limited ('Harvest' or the 'Company')

Strategic Alliance with Major Brazilian Fertiliser Producer & Distributor

to Sell KPfértil

Harvest Minerals Limited, the AIM quoted natural fertiliser producer, is pleased to announce that it has signed a strategic alliance agreement ("the Agreement") with Geociclo Biotecnologia S/A ("Geociclo"), one of the largest developers, producers and distributors of organic fertilisers in Brazil to market and sell Harvest's KPfértil product.  

Highlights:

·    Strategic alliance with internationally recognised Geociclo will enable:

o KPfértil, Harvest's Ministry of Agriculture ('MAPA') certified remineraliser, to be marketed and sold by Geociclo's established sales force

o Access to new agricultural regions in Brazil dominated by Geociclo and the expansion of Harvest's existing market penetration for the product

o Unrestricted access to Geociclo's MAPA accredited research and trial production facility, expected to expediate the development of any future products

o Storage of significant quantities of KPfértil in Geociclo's storage facilities   

·    Geociclo is established in the Brazilian fertiliser sector having worked with international organisations including the Federal University of Uberlândia, the Agricultural Research Company of Minas Gerais and the Massachusetts Institute of Technology

·    Geociclo's facilities are located in Uberlândia in Minas Gerais, Brazil, the country's largest agricultural region, approximately 450km from Harvest's Arapua project and outside of the geographic location originally targeted by Harvest's sales and marketing functions

Brian McMaster, Executive Chairman of Harvest, said, "Geociclo is an internationally recognised agricultural company and we believe that this alliance will significantly enhance our sales channels and complement our existing arrangements with other parties. As market leaders in the Minas Gerais region, Brazil's largest agricultural region, Geociclo have an established sales team that will now work to promote KPFértil.  Additionally, the Agreement provides further benefits, namely Geociclo's extensive research and development facilities which our team will utilise to broaden our range of products.  Geociclo's existing MAPA accredited manufacturing facilities, capable of blending and producing these new products, allows us a fast-track to market.

"With the recent receipt of MAPA approval for KPfértil, we will continue to focus on sales and our objective of expanding production capacity at Arapua to build revenue and shareholder value."

Further Information

The Agreement provides Harvest with an immediately expanded sales and marketing team in a geographic location not currently covered by Harvest's sales activities.  At present the Geociclo sales team, including 11 full-time sales professionals and associated administrative assistants, sell the Geociclo product, Geofert, exclusively.  Pursuant to the terms of the Agreement, the sales staff will now market and sell KPfértil alongside Geofert.  These products are not direct competitors and it is expected that by marketing the products together, it will increase overall market penetration for both.

Under the terms of the Agreement, Harvest has direct access to Geociclo's research staff and facilities to develop, produce and market new fertiliser products. Geociclo has a dedicated in-house research facility supported by a team of 10 specialists.   Access to these facilities provides Harvest with the opportunity to work directly with farmers, distributors, blenders and other prospective clients to develop products specific to crop requirements of individual customers.  Additionally, Harvest will be able to conduct test work in order to tailor and enhance KPfértil, enabling the Company to target new markets.  The Board of Harvest believes that access to Geociclo's resources will positively impact the efficiency of future test work and product development.

Additionally, Geociclo also holds a 150ktpa MAPA registered processing plant and an associated storage facilities warehouse, which Harvest will be permitted to store substantial quantities of its product at this facility, in effect creating a sub-depot.

Geociclo Biotechnologia S/A:

Geociclo was established 11 years ago to develop, produce and distribute a range of organic mineral fertilisers.  Over this period it has gained national and international recognition for its innovative work in organic fertilisers working alongside renowned institutions such as UFU (Federal University of Uberlândia), ESALQ / USP (Escola Superior de Agricultura Luiz de Queiroz - USP) (Agricultural Research Company of Minas Gerais), EMATER / MG (Technical Assistance and Rural Extension Company of Minas Gerais), IFTM (Federal Institute of Education, Science and Technology of Triângulo Mineiro and MIT (Massachusetts Institute of Technology).

The company has a main office, sales and marketing team as well as a research and development department in the city of Uberlândia in Minas Gerais, Brazil. The research facilities include a physicochemical and a microbiology laboratory, both accredited by the Ministry of Agriculture (MAPA) as well as a trial production facility.  Its sales and marketing division is also based here and comprises an eleven strong sales team plus support staff.

The company's main production facility is 35km from the city centre. It comprises two production lines which were recently expanded to produce 150Ktpa of its main product, Geofert.  Geofert comprises organic waste matter, micronutrients and an organic biodegradable polymer which is pelletised to produce a slow release organic NPK fertiliser. 

Further information about Geociclo can be found on its website: http://www.geociclo.com.br

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014

*ENDS*

For further information please visit www.harvestminerals.net or contact:

Harvest Minerals Limited	Brian McMaster (Chairman)	Tel: [phone]
Strand Hanson Limited Nominated & Financial Adviser	James Spinney Ritchie Balmer	Tel: [phone]
Arden Partners plc Joint Broker	Tim Dainton Paul Brotherhood Paul Shackleton	Tel: [phone]
Shard Capital Partners Joint Broker	Damon Heath	Tel: [phone]
St Brides Partners Ltd Financial PR	Isabel de Salis Gaby Jenner	Tel: [phone]

Notes

Harvest Minerals (HMI.L) is a Brazilian focused fertiliser producer advancing the 100% owned Arapua Fertiliser Project, which produces KPfértil, a proven, multi-nutrient, slow release, organic, MAPA-certified remineraliser.  KPfértil offers many economic and agronomic benefits and addresses the significant demand for locally produced fertiliser in Brazil, with its abundant agricultural land; currently, the country imports 90% of the potash it uses but has a target to be self-sufficient in fertilisers by 2020.  Covering 14,946 hectares and located in the heart of the Brazilian agriculture belt in Minas Gerais, Arapua is a shallow, low cost mine with an indicated and inferred resource of 13.07Mt at 3.1% K2O and 2.49% P2O5. 

This is based on drilling just 6.7% of the known mineralisation, leaving significant upside potential. This resource is equivalent over 29 years' production and the known mineralisation expected to support 100+ years' production at 450,000 tonnes per annum.

 

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