Morocco’s OCP is set to establish an organic fertilizer Spanish subsidiary. This is after obtaining government authorization in Spain to create its joint venture with Fertinagro Biotech to manufacture and commercialize organic fertilizer for agriculture.
The venture will be held in equal parts by both companies, although OCP owns a 20% stake in Fertinagro. Fertinagro OCP Organic Biosolutions, the new company, was first announced by a decree dated to May 6, 2022. The company will start with a capital of MAD 266 million (25 million euros).
In addition to manufacturing and commercializing fertilizer, the company will also perform research and development in the field of organic agriculture. Loans will finance 60% of the new company’s capital, while the other 40% will come from the shareholders.
Rising fertilizer demand
The turnover is expected to be at MAD 46.8 million (4.4 million euros) at the start, but forecasts predict that it will rise to MAD 1 billion (98.4 million euros) by 2029, representing an annual growth rate of 47%.
Fertinagro is a Spanish firm that specializes in fertilizers, with subsidies in Algeria, Argentina, France, Italy, Mexico, Portugal, and Ukraine. The new subsidiary is part of OCP’s diversification efforts. The Moroccan group has been highly active in Africa, cornering the market with its fertilizer and establishing training programs and manufacturing agreements in countries like Nigeria.
The group also announced the opening of a fertilizer plant in Brazil earlier this month, noting that this subsidiary will specialize in providing dietary supplements for animal food in a country that has the second-largest herd of cattle in the world.
The Spanish subsidiary is also part of OCP’s efforts to capitalize on rising fertilizer demand and prices. The world and — Europe in particular — has seen a steep rise in the prices of phosphates and fertilizers as a result of the war in Ukraine. Morocco’s phosphate reserves amount to 70% of global reserves, making OCP Group an indispensable player as the world navigates an impending food crisis.
