Trade and Business Development of IFFCO at the International Arena G. N Saxena Director (Coop. Dev) INDIAN FARMERS FERTILISER COOPERATIVE LTD. NEW DELHI (INDIA)
IFFCO - IN BRIEF § IFFCO is a Multi State Cooperative Society registered on 3 rd Nov 1967. Commercial Production commenced in the year 1975 § Produces 10 million Tonnes of Fertilisers annually § Contribute about 20% to the total ‘N’ and 25% to the total “P 2 O 5” produced in the country § Markets Fertilisers through 38, 955 member Cooperative Societies § Sales, Service and Support to the Farmers through a variety of programmes
Growth of IFFCO Initial At Present 57 38, 955 Share Capital 0. 05 million USD (1967 -68) 106 million USD Production 0. 18 (million MT) (1975 -76) 7. 01 (million MT) Turnover 588 million USD (1989 -90) 2300 million USD Membership
STRATEGY BY IFFCO FOR TRADE AND BUSINESS DEVELOPMENT • Multi-State Cooperative Law provides for encouragement to active participation of members in business • IFFCO bye-laws encourage more equity and business • Federations to lift Fertilizers in proportionate to their shareholding • International tie-ups after Demand Analysis / Market Research • Technology Transfer : – Technical alliances with other countries – Joint-Ventures
STRATEGY BY IFFCO FOR TRADE AND BUSINESS DEVELOPMENT (cont. . ) • Establishment of KISAN INTERNATIONAL TRADING, FZE, Dubai – A Special purpose Vehicle (SPV) – To Scout for Raw Materials and same to India / Joint Venture Projects – For Shipping, Canalising, Routing and Logistics Monitoring of the Raw Materials
STRATEGY BY IFFCO FOR TRADE & BUSINESS DEVELOPMENT (cont. . ) Marketing Development – Supply of Quality Fertilizers – Marketing through the cooperative network only – Transportation Support (Subsidy) to carry fertilizers in interior area – Utilize Infrastructure of cooperative, mainly utilization of warehouses of Cooperatives – Financial Support to Weak Member cooperatives – IFFCO supplies fertilizers to neighboring countries on demand
STRATEGY BY IFFCO FOR TRADE AND BUSINESS DEVELOPMENT (cont. . ) • Expertise in procurement of raw materials – Rock Phosphates, – Phosphoric Acid, – Sulphur • Buy-back arrangements for Ammonia and Urea from Oman India Fertiliser Company • Effective Services of Kisan International Trading FZE (KIT)
IFFCO’s Global Presence IFFCO has entered into JV- Projects and diversified into different areas Oman India Fertiliser Company (OMIFCO): – Annual capacity of 1. 6 Million MT Urea and 0. 25 Million MT Ammonia – The Actual project cost USD 892 million (saving of about USD 80 million on estimates)
IFFCO’s Global Presence (cont. . ) Industries Chimiques du Senegal (ICS) • IFFCO holds about 20% of the paid-up share capital. • Under long term buy-back agreement , 0. 5 Million MT phosphoric acid is lifted by IFFCO Tokio - General Insurance Company Ltd( ITGI) • IFFCO holds 74% equity share • Balance equity subscribed by Millea Asia, Singapore; a group company of Tokio Marine & Fire Insurance Company
IFFCO’s Global Presence (cont. . ) Indo Egyptian Fertiliser Company SAE, Egypt • To set up a Phosphoric Acid Plant of 0. 5 Million MTPA capacity • IFFCO holds 76% equity. The estimated Project cost is USD 325 Million • Pre-project activities have been started. The plant is expected to start commercial production in 2009
IFFCO’s Global Presence (cont. . ) Phosphoric acid plant at Jordan • Signed an MOU with Jordan Phosphates Mines Company (JPMC) • To set up a 1500 t/day phosphoric acid plant to be located in Southern Jordan • IFFCO and its associates to have 52 percent equity participation. • The estimated project cost is USD 350 million
IFFCO’s Global Presence (cont. . ) IFFCO Kisan Bazar • Incorporated in the year 2004 • Objective to Setup a chain of Fair Price Super Stores across the Country. • Negotiations are in progress for strategic alliances with prospective foreign partner for setting up large Retail Outlets in India • Mo. U signed with NTUC Fair Price, Singapore
IFFCO’s Global Presence (cont. . ) IFFCO Chhattisgarh Power Ltd. • Joint Venture Company with Chhattisgarh State Electricity Board (CSEB) • Set up a 1000 MW coal based mega power plant; Scheduled to be commissioned in 2010 • The total estimated project cost is USD 1 billion • Equity participation by IFFCO 74% • The Company to supply electricity to farmers at a cheaper rate • IFFCO’s investment is 9. 25 million USD
OTHER INITIATIVES • IFFCO KISAN SANCHAR LTD. – Cheaper cell - phone – Information with focus on the farmers – Tie-up with some companies in China / Hong Kong • Marine Organic Phosphate Fertiliser – Company from Indonesia named • Madura Guano phosphate Fertiliser • Group of companies for Oil refineries at Paradeep • Mutual Assistance Agreement with Mauritius Agriculture Cooperative Marketing Federation, Mauritius
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