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Tractor on cotton farm in the USA

Fertiliser

Olam recognised the potential of fertilisers as a new growth segment for our Agri-Inputs business in 2009, as a result of the acknowledged mismatch between limited new arable land available, and the growing demand for agricultural produce to meet increasing globalisation needs.

In addition to improving yields and enhancing the supply of agri-commodities, our fertilisers will complement our traditional core business of supplying crop inputs to farmers. Currently, we are able to tap on a crop input base of 1.5 million growers in critical origin markets like West Africa, Latin America and the USA to supply our fertilisers.

Fertilisers are sub-divided into three broad categories – Nitrogen-based (urea and ammonia among others); Phosphate-based and Potash-based. Of these three, nitrogenous fertilisers, particularly urea-based ones, enjoy the largest global volume but have a very fragmented supplier base.

As part of our entry strategy, we chose to participate in upstream, Urea and Ammonia production in Gabon because of good accessibility to low-cost feed stock, better economies of scale, and close proximity and ease of access to end users.

The project will be one of our major businesses going forward, following which we will continue to seek other sector opportunities that will provide good economic returns.