Allana PotashCorp.(“Allana”) and the Ethiopian Agricultural Transformation Agency (“ATA”) are pleased to announce that they have signed a Memorandum of Understanding (MOU) to demonstrate the use of potash, a potassium rich mineral salt, in Ethiopian agriculture.
Historically, Ethiopian farmers primarily rely on only two fertilizers to supplement the nutrient content in their soil, phosphorus in the form di-ammonium phosphate (DAP) and nitrogen in the form of Urea. A standard application of 100kg of DAP and 100kg of Urea has traditionally been recommended across Ethiopia for all crops and soil types. However, this recommendation fails to take into account the current fertility status of a soil, or specific crop needs. Since only DAP and Urea fertilizers are commercially available, their positive effect of stimulating crop growth also increases the rate of draw-down of native soil fertility, including potassium, thereby reducing native soil fertility levels of essential nutrients not supplied by fertilization.
Trials conducted to date by various stakeholders, including the ATA, have demonstrated the need for using potash-containing fertilizers in many agricultural areas of the country. To help improve this situation and aid Ethiopia’s smallholder farmers in increasing their crop production, the ATA is facilitating a variety of soil-related interventions, in partnership with the Ministry of Agriculture (MOA) and the Regional Bureaus of Agriculture. Some of these interventions include: a geostatistical soil fertility mapping of the agricultural land in the country; recommending relevant fertilizer applications for each local woreda based on the information from the mapping work; and the development of fertilizer blending facilities in key regions throughout the country. These local blending plants will make an expanded range of soil nutrients available to farmers in field-level quantities, customized to their specific soil types, crops, and agro-ecologies. As potassium is one of the vital crop nutrients to be supplied via these new fertilizer blending facilities, Allana is partnering with the ATA to demonstrate, through a series of systematic, local, balanced fertilizer field trails, the important role of potash fertilizer to farmers, in blends or as straight fertilizers.
Khalid Bomba, CEO of the Ethiopian Agricultural Transformation Agency, noted that, “providing and popularizing a full range of soil nutrients to Ethiopia’s smallholder farmers is essential to helping them realize the full production and profit potential from their farming lands. As part of this objective, partnering with Allana is an ideal way to introduce and promote the benefits of potassium fertilizers among Ethiopia’s smallholders.”
Farhad Abasov, President and CEO of Allana Potash Corp., commented, “Allana is very proud to contribute to the agricultural growth strategy of Ethiopia. The Government of Ethiopia has provided support and encouragement to the company during its developmental phase and, so, it is in this light that Allana happily partners with the ATA. A strong agricultural economy is a critical step in creating a robust national economy, one that Allana Potash considers vital to its future. Mark Stauffer, Allana’s Chair and the former President of the Potash and Phosphate Institute of Canada, will lead the initiative with the ATA on Allana’s behalf.”
Pursuant to the MOU and subject to certain conditions, Allana, who is already developing its previously explored flagship property, the Dallol Potash Project, in Ethiopia’s Danakil region, has agreed to donate a total of USD$200,000 per year for the first two years of the effort, or directly pay for the procurement and shipping of blended fertilizers from abroad in an equal amount. In addition, Allana has agreed to donate potash fertilizer, estimated to be valued at no more than USD$300,000-$400,000, in year-3 of the plan, conditional upon Allana having begun commercial production of potash fertilizer in Ethiopia by that time.
Although the fertilizer for the 2013 demonstrations and scale-up will be sourced from overseas, the long-term intention for the plan is based on Allana’s development of the Dallol project in northeastern Ethiopia. Working with Ethiopia’s Ministry of Mines, Allana will help tap into the country’s natural potash reserves, providing an overall boost to the Ethiopian economy through mining and infrastructure development, in addition to the related potential benefits in the agriculture sector.
The expanded fertilizer project being implemented by the MoA and the Regional Bureaus of Agriculture, with support from the ATA, is currently working to build four fertilizer blending plants across the country, to be run as independent, profitable businesses by the selected agricultural cooperative unions.