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Thursday, December 8, 2022

Morocco – a top fertiliser producer

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Morocco has a big fertiliser trade with large manufacturing capability and worldwide attain. It is likely one of the world’s high 4 fertiliser exporters following Russia, China and Canada.

Fertilisers are inclined to divide into three important classes; nitrogen fertilisers, phosphorus fertilisers, potassium fertilisers. In 2020 the fertiliser market measurement was about US$190 billion.

Morocco has distinct benefit within the manufacturing of phosphorus fertilisers. It possesses over 70% of the world’s phosphate rock reserves, from which the phosphorus utilized in fertilisers is derived. And this makes Morocco a gatekeeper of worldwide meals provide chains as a result of all meals crops require the factor phosphorus to develop. Certainly, so does all flora. In contrast to different finite assets, reminiscent of fossil fuels, there isn’t a different to phosphorus.

In 2021, the worldwide phosphorus fertiliser market amounted to about US$59 billion. In Morocco, the sector’s 2020 revenues amounted to US$5.94 billion. Workplace Chérifien des Phosphates, the producer owned by the Moroccan state, accounted for about 20% of the dominion’s export revenues. It’s also the nation’s largest employer, offering jobs for 21,000 individuals.

Morocco plans to supply a further 8.2 million tonnes of phosphorus fertiliser by 2026. Presently manufacturing is at about 12 million tonnes.

The state firm just lately introduced that it will enhance its fertiliser manufacturing for the 12 months by 10%. This is able to put a further 1.2 million tonnes on the worldwide market by the top of the 12 months. This may considerably assist markets.

However, as I argue in a brand new report, Morocco faces new challenges. Its manufacturing of fertiliser is threatened by more and more daunting environmental and financial challenges. They embrace the COVID pandemic and the extreme provide chain disruptions which have adopted.

The timing to handle these is essential.

Russia is presently the world’s largest fertiliser exporter – 15.1% of complete exported fertilisers. And fertiliser represents one of many best vulnerabilities for each Europe and Africa. For example, the EU27 (all the 27 member state of the European Union) as a complete is determined by Russia for 30% of its fertiliser provide. Russia’s advantageous place is amplified by its standing because the world’s second-largest pure fuel producer. Fuel is a important part of all phosphorus fertilisers in addition to nitrogen fertilisers.

Due to this, Russia’s invasion of Ukraine has severe implications for international meals safety. Each by way of provide, and in addition as a result of fertiliser can be utilized a financial weapon or device.

Morocco might due to this fact grow to be central to the worldwide fertiliser market and a gatekeeper of the world’s meals provide that would offset the try to make use of fertiliser as a weapon.

The journey

Morocco began to mine phosphorous in 1921. Through the Nineteen Eighties and Nineties it started to supply its personal fertiliser. Workplace Chérifien des Phosphates constructed the world’s largest fertiliser manufacturing hub in Jorf Lasfar on Morocco’s Atlantic coast.

Earlier than the outbreak of the Russia-Ukraine conflict, the corporate had over 350 shoppers on 5 continents. About 54% of phosphate fertilisers purchased in Africa come from Morocco. Moroccan fertilisers additionally account for main home market shares in India (50%), Brazil (40%) and Europe (41%). India and Brazil have reached out to Morocco to fill extra provide gaps.

Picture from the OCP’s 2020 sustainability report.

Morocco’s financial system has reaped the advantages of the transformation into a global fertiliser exporting big. And in sub-Saharan Africa specifically, the mixture of three way partnership partnerships in native fertiliser manufacturing and direct outreach to farmers has resulted in a outstanding increase to African agricultural yields.

It’s additionally expanded Morocco’s tender energy affect throughout the continent. For example, Morocco provides over 90% of Nigeria’s annual fertiliser demand.

However, how properly Morocco manages challenges to the trade will have an effect on each its personal financial improvement and the steadiness of meals provides the world over.

The challenges

Water and vitality constraints

Phosphate extraction and fertiliser manufacturing makes use of plenty of vitality and water. Morocco’s phosphate and fertiliser trade consumes about 7% of its annual vitality output and 1% of its water.

However Morocco is among the many nations struggling probably the most from water shortage. This is because of a dry local weather, excessive water demand, local weather change and reservoir contamination and siltation.

Morocco is making an attempt to handle this by means of a Nationwide Water Plan 2020-2050. It envisages constructing new dams and desalination crops and increasing irrigation networks, amongst different measures, to maintain agriculture and ecosystems. It’s estimated to value about US$40 billion.

Pure fuel prices

Nitrogen is the opposite primary fertiliser factor that crops want. Diammonium phosphate, the preferred kind of phosphorus fertiliser worldwide (and which Morocco makes together with monoammonium), consists of 46% phosphorus and 18% nitrogen. Pure fuel accounts for not less than 80% of the variable value of nitrogen fertiliser.

This implies the worth of pure fuel massively impacts manufacturing prices. However Morocco has scant pure fuel assets. And pure fuel costs have been hovering.

How properly Morocco manages the food-water-energy nexus will have an effect on each its personal financial improvement and the steadiness of meals provides the world over.

Some solutions

The bottom line is to develop its renewable vitality sector. Morocco holds appreciable photo voltaic and wind assets. Fertiliser manufacturing might grow to be powered by renewable vitality, and renewable vitality could possibly be used throughout the fertiliser itself.

In 2020, the state’s fertiliser firm lined 89% of its vitality wants by co-generation (producing two or extra types of vitality from a single gasoline supply) and renewable vitality sources. Its goal is to ultimately cowl 100% of its vitality wants on this method.

Renewable vitality may be used throughout the fertiliser itself. As a substitute of importing ammonia derived from pure fuel, Morocco might produce its personal utilizing hydrogen produced from its home renewable vitality assets.

Based on the state firm, 31% of its water wants are met with “unconventional” water assets, together with handled wastewater and desalinated seawater.

Morocco’s rising reliance on desalination crops to fulfill industrial, agricultural and residential wants would require sizeable new investments in energy era from renewable vitality sources. Desalination crops require 10 occasions the quantity of vitality to supply the identical quantity of water as standard floor water remedy.

Learn extra:
The place to search out extra water: eight unconventional assets to faucet

To maintain operations and develop inexperienced ammonia manufacturing, Morocco should strike a cautious stability between its fertiliser exports, its drive to develop its high-value agricultural exports and the availability of consuming water to its inhabitants.

Utilizing its massive photo voltaic vitality assets to energy inexperienced hydrogen and inexperienced ammonia manufacturing, together with desalination, Morocco might escape the vicious cycle of the upward spiralling of costs within the food-energy-water nexus.

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