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IFFCO inks 11-yr pact with UK-based Sirius Minerals to buy POLY4 fertiliser

PTI New Delhi
Updated: 12-06-2019 16:27 IST
IFFCO inks 11-yr pact with UK-based Sirius Minerals to buy POLY4 fertiliser

Image Credit: Pixabay

Indian Farmers Fertilisers Cooperative Ltd (IFFCO) Wednesday said it has signed a pact with UK-based Sirius Minerals Plc for purchase of POLY4 fertiliser over the next 11 years. The POLY4 fertiliser with four essential macro-nutrients and micro-nutrients like Boron will help in addressing the nutrient deficiency of soil. The product is certified as 'organic' in Europe.

"IFFCO is looking forward for its trials on cash crops like orange, apple, grapes, saffron, ginger, tea and coffee. The list will include more crops," IFFCO said in a statement. IFFCO did not disclose the financial details of the transaction.

Under the 'pay or supply' agreement, IFFCO will buy a significant volume of POLY4 fertiliser in the next 11 years. 'Pay or supply' agreement refers to a contract wherein the supplier/ buyer will have to pay if they fail to abide by the terms.

Volumes are expected to ramp up to one million tonnes per annum by year eight, with options in place to increase supply further to 2.5 million tonnes, it said. IFFCO has a 'break clause' after year eight, and there is a 10-year extension option which is subject to mutual agreement.

"Volume commitments ramp up after Sirius' first commercial production begins. The initial terms include provisions for volume flexibility where, subject to certain conditions, IFFCO may roll forward a proportion of the minimum quantities between contract years," IFFCO said. A steering committee will be set up to assist both parties to implement the in-country marketing plan for sales of POLY4, including liaising in relation to research and development, it added.

Commenting on the deal, IFFCO Managing Director and CEO U S Awasthi said: "POLY4 offers a unique opportunity for IFFCO to help deliver our vision of increasing farmer's incomes by increasing crop productivity and the balanced use of energy efficient fertilizers." The multi-nutrient characteristics of POLY4 are well suited to Indian soil and the partnership with Sirius will have an important role to play for farmers for many years to come, he said.

"This is actually in line with IFFCO's ongoing initiative of balanced nutrition management for soil. A good quality soil will actually help our farmers to increase their yield. This will certainly help in the Prime Minister's initiative of doubling the farmers' income by 2022," he added. Sirius Minerals Plc Managing Director and CEO Chris Fraser said POLY4 can undoubtedly have a hugely positive impact on Indian agriculture, both in terms of yields and sustainability.

"We look forward to working with IFFCO to deliver these benefits for Indian farmers for many years to come," Fraser said. IFFCO is one of the largest co-operative societies in the world with over 36,000 member cooperatives and access to over 55 million Indian farmers. Its primary business is the manufacturing and marketing of fertilizers.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)