Morocco’s OCP Group to establish US$6.1 billion integrated fertilizer complex in Ethiopia

ETHIOPIA – Morocco’s state-owned phosphate and fertilizer company OCP Group, has signed an agreement with the government of Ethiopia to implement a fertilizer project in Dire Dawa.

The project will have an initial estimated investment of approximately US$2.4 billion during the first phase to develop a 2.5-million-ton fertilizer production unit, combining Urea and NPK/NPS products.

Its second phase, earmarked to cost US$3.7billion will boost the production capacity to 3.8 million tons per year.

The agreement was reached during a high-level delegation visit to Morocco led by Ahmed Shide FDRE Minister of Finance, and accompanied by officials from the Ethiopian Chemical Industry Corporation (CIC), the Ethiopian Agricultural Businesses Corporation (EABC) and the Ethiopian Mineral, Petroleum and Biofuel Corporation (EMPBC).

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According to reports by Ethiopia News Agency, the project follows a feasibility, conceptual, environmental and social impact assessment and hydro and geotechnical studies that were recently concluded.

The integrated fertilizer complex will be using local resources such as Ethiopian gas and Moroccan phosphoric acid.

It is firmly believed that this project will have significant contributions in meeting Ethiopia’s continuously growing demand for fertilizers (primarily Urea and NPS+).

As from 2022, fertilizer imports in Ethiopia are estimated to reach US$1 billion, and could potentially reach US$2 billion in 2030.

“The Government of Ethiopia affirms its firm support for agriculture and continues to working tirelessly to find tailored solutions to agricultural and industrial challenges of the country,” stated the Ministry of Foreign Affairs of Ethiopia in its statement.

Zambia’s new fertilizer factory to cut importation by 60%

Meanwhile in Zambia, Wonderful Group of Companies is seeking to set up a US$300 million local fertilizer manufacturing plant under the name United Capital Fertilizer Zambia Company Limited.

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The group intends to build the facility in a bid to cut the importation of fertilizer in the country by about 60% and reduce the cost of fertilizer by about 40%, as it will use local raw materials and leverage on economies of scale.

The company, according to reports by Zambian Business Times, would be able to supply 80% of the total percentage of urea demand and 60% of the total percentage of D compound required for the country.

The raw materials, which include coal and phosphate, would be acquired locally in Southern Province and once operational, the plant will create about 1,100 direct jobs.

To finance the initiative, the company will source 60% of the investment funds from financial institutions outside Zambia with 40% being sourced locally, adding that US$20 million from the US$ 300 million is working capital for the first two years as per draft cash flows.

The fertilizer manufacturing factory is set to have a production capacity of 135, 000 metric tonnes per annum for fertilizer and 80,000 metric tonnes per annum for ammonia bicarbonate.

In addition, it will be designed to have a robust and state of the art integrated cross-circuit production process such that there will be no emission of either smoke or gasses adding that the smoke will be converted into a gas by-product, for which the company already has a captive market.

The new plant would be producing ammonia as a by-product, therefore there will be no need to continue importing from South Africa, thus boosting the production for local companies such as NCZ.

Zambia has been importing its bulk fertilizer to meet its growing land under cultivation. However, prices of the essential commodity had escalated following the depreciation of the local currency, contributing to sky rocketing food prices.

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