Alliance Group returns to profit after two years with $93m turnaround
After two years, Alliance Group has returned to profit.
Major farm nutrient supplier Ballance Agri-Nutrients has been without an RPR product since autumn when a Peruvian supplier couldn’t deliver product in-spec and at volumes required to meet of the needs of NZ farmers.
CEO Mark Wynne said since then the co-operative had been working hard to find an alternative RPR supply, eventually finding a source in Morocco. “We had very limited options that would meet both nutrient specifications and continuity of supply.
“Our understanding is that other major suppliers are having similar difficulties.”
Fertmark has specifications on phosphate, citric solubility and cadmium that products imported into New Zealand must meet in order to be marketed and sold as RPR.
Wynne said tests prior to product leaving Morocco returned favourable results, however testing on arrival in New Zealand during unloading showed the product did not consistently meet citric solubility specifications. Results were verified in further independent testing.
Wynne said that following the test results, it was a ‘no brainer’ not to market and sell the shipment as RPR. “We’ve built the Ballance co-op on a foundation of science and our credibility is not something we’re prepared to compromise.”
He said that conversations with farmers over the past week have confirmed there is still demand for the off-spec phosphate rock, in particular for organic farmers looking for a slow release rock that meets BioGro certification standards. “Customers appreciate our transparency around this issue. We’ll continue to sell the product where there is demand, but we’re being open about the fact that it doesn’t meet the grade as an RPR.”
Depending on the drivers for using RPR there are a number of other alternatives for customers looking for a low water soluble and pH neutral source of phosphate such as SerpSuper or Dicalcic Phosphate. For others less concerned about water solubility or acidity then Superten or a blended product mix is recommended.
With regards to the future of RPR Wynne said given recent experiences globally he was uncertain of volume and continuity of supply for on-spec product. Ballance was continuing to work with its international supply partners to meet future market needs.
Small volumes of RPR are available from various parts of the world, but quality is variable and volumes are unpredictable.
RPR is a natural phosphate product suitable for direct application that is traditionally sourced from South America or North Africa. It is usually used in maintenance applications where phosphate levels are optimum, by organic farmers, or blended with water soluble phosphate to offer a quick and slow release combination.
