MIDAS STOCK TIPS UPDATE: Emmerson May Expand Your Portfolio With Non-Russian Potash

In Morocco, silver tea trays are known as rayts. The name derives from Richard Wright, a Mankun silversmith and prolific maker of silver teaware.

Wright worked in the 18th century, but his teapots are still prized across Morocco to this day, part of a long and fruitful trade relationship between the North African country and Britain.

These close relationships bode well emmersona Yorkshire based company developing a major potash mine in northern Morocco.

Spread the word: potash is an essential ingredient in fertilizers, and typically around 40 percent comes from Russia and its ally Belarus

Potash is an essential ingredient in fertilizers, and typically around 40 percent comes from Russia and its ally Belarus.

Prices of this commodity have historically averaged $400 (£300) per tonne. But the price had started to rise even before Putin invaded Ukraine, reaching $800 per ton by the end of 2021.

In the past few weeks it has risen even further, topping $1,000 per tonne and even reaching $1,200 per tonne in some places. Such elevated levels may not last, but most market watchers expect prices to remain elevated for years to come as traders around the world try to wean off Russian potash and seek alternative suppliers.

Emmerson should prove an attractive option. The Company is still developing its mine, but potash is plentiful and several important steps have been taken towards commercial production. Engineers are in place, a financial strategy has been devised and Managing Director Graham Clarke has secured up to $46 million in backing from a Singapore-based investment group.

The group is in talks with several other potential financiers, as well as a number of Moroccan and international banks. Brokers are confident that Clarke will secure the cash he needs, especially since potash supplies are so tight at the moment.

Environmental permits have yet to be finalized, but Emmerson has addressed any issues raised by Moroccan authorities and Clarke has worked hard to ensure his project benefits local communities and workers.

Relations between the company and government officials are aided by the wider ties between Morocco and the UK. And there are strategic gains to be made.

Emmerson’s mine will be the first commercial potash site in Africa, a continent whose agricultural capacity could be transformed through greater use of high-quality fertilizer.

The mine is also well positioned – a two-hour drive from the port of Casablanca, from where potash can be easily shipped to Europe and Brazil, one of the largest fertilizer markets in the world.

Midas verdict: Midas recommended Emmerson at 3.1p in 2019. Shares had doubled since last year, are now at 7.5p and should rise significantly if environmental permits are granted and financial backing secured. No development project is risk-free, but this stock appears to be doing better than most loss-making miners. Existing investors should hold, while the shares also look attractive to new investors looking for adventure.

Traded on: TARGET Ticker: EML Contact: or 020 7236 1177



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