RE:Sales volume versus Production volume
Looking forward to your comments on MD&A. I was going to reply to that newer post, but thought it better to reply to this one.
I have a tendency towards optimism, but I've also been told I find the cloud in any silver lining, so go figure.
That bias stated I am happy with the third quarter results, primarily because they continued to increase sales of a new product, a new brand. Using 9million tonne of potash as the total Brazilian market share, taken from the 2019 corporate presentation, Verdes 2019 share of the market was 1.3% I think they'll sell around 62000tonne in Q4 and exit 2020 with 2.6% of the market share. This to me is a great increase and shows solid and growing support for the companies product. I presume there will be a critical mass in farmer support, purchasing and use, but I don't know enough about this topic generally and will need to read more to improve my understanding.
I'm also really pleased they decreased their cost per tonne down to $12 from 2019's $25. I'm curious if this is something sustainable, e.g. reduced electrical costs, or will again increase when we're eventually clear of COVID-19, e.g. presumed reduced trucking costs. I'm curious if you'll find they've done some interesting accounting and moved these costs someplace else.
I think the company is doing well, but I am thinking you are correct that the feasibility report is off. It's not as simple as the 1:1 KFort vs KCl mine and sell scenario, that timeline was too optimistic and likely didn't account for this delay in a need to penetrate into the market.
If our trend is to double market share each year we can catch up on the timeline quite quickly. Realistically we don't have enough data to trend our market share increase but intially it looks good. Increasing market share should also bring down the relative cost such of the sales force, from what I understand that does not increase in a linear fashion.
Thanks as usual for the groups posts. Looking forward to reading more.