A Brazilian government program to fund agriculture-related projects has chosen to finance a potash mine to be developed in Brazil by Verde Potash PLC, the company said this week.
Details and amounts of funding were not released, but Verde Potash Chief Executive Cristiano Veloso said in an interview that the Inova Agro financing program includes a combination of debt at subsidized interest rates, equity investment and non-reimbursable grants.
Verde's Cerrado Verde project would produce much-needed potash fertilizer mainly for use within Brazil.
Veloso said he is "extremely confident" the project in Minas Gerais can go ahead.
The project is awaiting an environmental license from Brazil and Veloso declined to predict when that might occur.
Verde shares jumped 55 percent in Toronto on Tuesday to 87 Canadian cents, following a rise of 47 percent last week.
Brazil, which is expected to surpass the U.S. as the world's largest soybean producer this year, imports about 90 percent of its potash. Despite also being the world's largest producer of coffee and orange juice and a growing producer of corn and wheat, its soils are low in many essential nutrients and require large amounts of fertilizer.
Inova Agro is an initiative of the Brazilian government that coordinates the resources of the state-owned Brazilian Development Bank (BNDES) and Financing Agency for Studies and Projects (FINEP).