Cordiant Capital, the Montreal, Canada-based fund manager that specialises in loans to private borrowers in emerging markets, has provided a $10 million loan for the Jordan-India Fertilizer Company (JIFCO).
The loan will finance the construction of a $186 million plant based in Jordan that will use phosphate rocks from local mines to produce phosphoric acid fertilizer for the Indian market.
A statement issued by Cordiant says that the location of the plant, near to the Eshidiya phosphate mines and Jordan’s only sea port, will keep production and transport costs to a minimum and make the fertilizer “very competitive”.
The statement says that the quantity of fertilizer used per hectare in India is only 25 percent of that applied in developed economies, making Indian agriculture far less competitive. JIFCO’s fertilizer will end up in the hands of thousands of Indian farmers, improving the productivity of agricultural production and helping to ease the country’s food shortage.
Demand for phosphoric acid is predicted to keep rising as the growing Indian middle class demands food with a higher protein content, putting pressure on food supply.
David Creighton, president and chief executive of Cordiant Capital, says in the statement: “This landmark project is a great investment opportunity offering our fund an attractive return and a very low risk profile. Demand for phosphate in India has been growing at a compound annual rate of 5 percent over the last 15 years and the trend is expected to continue.”