Investor Presentaiton
Verde's margin according to average KCI CFR Ports price
The table below compares Verde's and KC's prices delivered to the farmer and shows Verde's potential revenue at each case.
KCI CFR Ports
(US$ per tonne)
KCl price per tonne
delivered to the
farmer (600kg of
K20)(US$)1,2
263
K ForteⓇ
production cost
per tonne (100kg
of K20)(US$)³
(+)
K Forte® production
cost per tonne x 6
(600kg of K20)(US$)
(+)
Freight cost to
deliver 6 tonnes of
K ForteⓇ to the
farmer (600kg of
K20)(US$)4
(=)
K ForteⓇ delivered to
the farmer (600kg of
K20)(US$)
Brazil's potential market
size to be supplied by
Verde (million tonnes of
K ForteⓇ, 100kg of K2O)
Potential revenue
for Verde
(million US$)5
Verde's margin (%
of potential
revenue)5
100
12.95
77.71
167
244
9
399
7%
200
378
11.29
67.72
238
306
34
2,150
19%
300
493
10.17
61.00
281
342
56
4,566
31%
400
608
10.17
61.00
313
374
67
6,789
38%
500
723
10.17
61.00
325
386
70
8,396
47%
The table above is based on the following assumptions: Brazil's market size projected for 2023 = 7.02Mt of K2O, equivalent to 70.20Mt of K Forte® (10% K2O). Diesel price = US$1.08. Currency
exchange rate: US$1.00 = R$5.25.
1 - Source: Acerto Limited Report, as of December 12, 2022.
2 - 0.8% rate charged for brokerage and 0.17% rate charged for insurance rate, 25% rate charged for sea freight, US$25 (blender / dealer costs) + 12% (from KCl delivered to the blender) rate
charged by blender/dealer, which includes taxes and profit margin (source Tec-Fértil).
3 - Based on Verde's NI 43-101 Pre-Feasibility Technical Report Cerrado Verde Project, considering K Forte®'s potential market for each production scenario (10Mtpy, 23Mtpy and 50Mtpy).
4 - Weighted average freight cost based on the market size in tonnes of K20 for each region. The freight value variation is due to the different regions of Brazil where the Company can deliver K
Forte® for the same cost or at a lower cost per tonne of K₂O than KCl, according to the average KCI CFR Ports price (please refer to the map on previous slide).
5 - Verde's potential revenue was calculated based on KCI's price to be delivered to the farmer multiplied by KCI's potential market in K2O demand. Verde's margin was calculated as the deduction
of the total costs to deliver 6 tonnes K ForteⓇ to the farmer (production + freight costs) for each potential market of K ForteⓇ from Verde's potential revenue.
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