Israel Chemicals Ltd. (TASE: ICL) has signed a memorandum of understanding with Vietnamese chemicals company Duc Giang to jointly tmine phosphates and build phosphates processing plants for the local and Southeast Asia markets.
Israel Chemicals says that the agreement is part of its Next Step Forward strategy, and is part of its plan to expand and diversify its mining sources outside of Israel, broaden its global phosphate operations, and provide a growth engine for its primary markets
Phosphates are used in Israel Chemicals three core markets food, agriculture and engineered materials, and the company plans to expand its phosphates operations.
Israel Chemicals said, "Building the platform in Vietnam is not intended to replace Israel Chemicals' activities in Israel, but aims to strengthen its overall franchise in the phosphate markets globally, especially in Asia. The new joint company may also supply several Israel Chemicals customers and plants currently served by the company’s Israeli platform located in the Negev, should activities there cease due to the expiration of mining permits several years from now."
Israel Chemicals' phosphates mine in the Negev is nearing exhaustion, and plans to develop a new mine at Sde Barir have been held up, due to resistance from local residents and the Ministry of Health.
Israel Chemicals and Duc Giang are evaluating joint activities to expand phosphate mining in Vietnam and manufacture phosphates products. They believe their cooperation will serve as the basis for the further expansion and intensification of cooperation between the two companies in Vietnam and in Southeast Asia.
Published by Globes [online], Israel business news - www.globes-online.com - on September 2, 2013
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