Construction of a plant for the production of sodium humate

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Construction of a plant for the production of sodium humate
FINANCIAL INDICATORS of PROJECT
PROJECT COST
637 915 773 tg
IMPLEMENTATION DATE
16 months
Quantity staff
42 people

Project Description

PROBLEM
  • In recent decades, the problem of increasing soil fertility, the use of organic additives to increase crop yields has become increasingly topical. One of such additives are humates – sodium and potassium salts of humic acids. Humates and humic acids are the chemical basis of soil humus, its concentrate. And humus is the basis of the activity and stability of most biochemical soil processes.
  • In order to implement the Message of the Head of State to the people of Kazakhstan dated January 10, 2018 “New development opportunities in the fourth industrial revolution”, an increase in 5 years of labor productivity in agriculture and exports of processed agricultural products at least 2.5 times compared with 2017. It is planned to increase the competitiveness of the agro-industrial sector by increasing labor productivity from 1.2 million tenge per 1 employed in agriculture in 2015 to 3.7 million tenge by 2021, as well as exporting processed products from 945.1 million dollars in 2015 to $ 2,400 million in 2021
  • In terms of arable land per capita, Kazakhstan ranks second in the world; 1.4 million hectares of irrigated land; Kazakhstan is among the largest exporters of grain and flour; growing demand for food products in neighboring countries (CIS, Central Asia, China).
  • The share of agricultural products in the country’s GDP remains low (4.8%);
PRODUCT

The aim of the project is the production of sodium humate – fertilizer for the needs of agriculture in the Pavlodar region based on the use of drilling coal from Ekibastuz deposit and sapropel of nearby reservoirs.

PROJECT STATUS

The period of the investment project is 16 months: the creation of equipment -6 months of construction of buildings and the creation of equipment – 8 months, installation and commissioning of equipment – 2 months.

MARKET
  • The project has a favorable climate: -the presence of brown coal dumps in the region and neighboring areas, which can be quickly delivered to the project site; -the possibility of rapid growth in production due to the coverage of a large market throughout Kazakhstan, entry into the market of Russia and foreign countries.
  • World market of stocks of humic fertilizers in 2008-2016 amount to about 860 billion tons, incl. brown coal (lignite) – 195 billion tons (23%) According to the State Program for the Development of the AIC, the need for organic fertilizers is 100 million tons. The area of ​​organic fertilizer application in 2017 was about 117 thousand hectares, which is 70% higher than in 2015. The republic’s annual need for organic fertilizers with an arable land area of ​​21–22 million hectares is about 100–110 million tons with a scientifically based application rate of 5 tons / ha. Thus, there is a real demand for organic fertilizers. The estimated share of sodium humate in the total fertilizer market is 30 million tons per year.
  • The project assumes the production of fertilizers in the amount of 40,000 tons per year or 8.4 million tenge, which is less than 1% of the total capacity of the market for fertilizers based on Humate.
TECHNOLOGY
  • The method of production of humic acid concentrate from brown coal includes grinding it to obtain microparticles, preparing a suspension in a weak alkali solution, and extracting, with mechanical stirring, the suspension in a mixer reactor, from microparticles of humic carbon. To complete the full cycle of works, the purchase of equipment for the production of sapropel (lake sludge), which is the main component in the production of humate, is required.
  • Sapropel of natural humidity is taken by a screw pump from the bottom of the reservoir and fed through a pulpwater to the bunker. After filling the bunker installation under its own power approaches the shore. With the help of the hydraulic cylinder, the frame is lifted, and the screw pump with the clamping head is connected to the hopper unloading device. After opening the valve of the unloading device, the screw pump pumps sapropel at a distance of 50 m to vehicles or a coastal warehouse.
  • Equipment for Sapropel – the development of the Center for Sapropel, Astrakhan.
RESOURCES
  • Raw materials for obtaining sodium humates are readily available – these are brown coal, peat, oxidized coal and sapropel.
  • To improve the quality of the final product, there are certain requirements for coal for the production of humates: Ash content is not more than 13%. Mass fraction of the mineral fraction not connected to humic acids is not more than 10%. Mass fraction of humic acids is not less than 65%. Since the seams of fossil raw materials are heterogeneous, it is not always possible to comply with the above-mentioned coal standards.
  • Humic substances have high concentrations of organic substances and trace elements. They are absolutely harmless to the soil microsphere, to plants and to humans. Humic substances give living organisms the nutrients they need gradually, as they are consumed, thereby preserving the necessary supply of these elements for future generations. The composition of humic substances found from 40 to 60% carbon, 3-5% nitrogen, 30-40% oxygen, as well as hydrogen, sulfur, phosphorus, many metal cations, including the so-called trace elements.
  • The project requires raw materials – 1) coal 1 ton per ton of product per year; 2) Sapropel – 1 ton per 1 ton of Humate; 3) Sodium caustic 1 ton per ton of product, 4) Packing bags – 1000 pcs.
MARKETING STRATEGY
  • Consumer sodium humate – industrial farms that are interested in high-quality and inexpensive product.
  • The sodium humate production company is competitive in the Pavlodar region, since there is only one competitor in this industry and with rapid entry into the market, it can begin to expand into the markets of Russia and other CIS countries.
  • An important parameter is the price of the goods, which forms the basis for the purchase of goods. All consumers, before making a purchase, compare the price of the company with its competitors. If the price increases, the company must provide justification for the price increase and provide other parameters as a competitive advantage in the market. The price of sodium humate – 210,000 tenge per ton is lower than the market average, since the raw materials – brown coal dumps and sapropel have a low cost.
  • The project provides for annual costs for marketing the product in the amount of 26 – 36 million tenge. The main channels of promotion should be direct communication with agricultural producers and brand positioning through the Internet promotion.
INVESTMENTS

The cost of the project is 637,915,773 tenge.

Planning 7 200 000
Equipment for the extraction of sapropel 49 920 000
Equipment for the manufacture of humate 270 000 000
Purchase of sapropel mining licenses 2 000 000
Vehicles for the export of sapropel, 10 units. 50 000 000
Building and assembly work 258 795 773
Arrangement of household yard 3 000 000
Building of production and packing workshops 235 477 200
Warehouse construction 9 875 342
Building of the administrative building 10 443 231
Total 637 915 773
FINANCIAL INDICATORS

The calculation of the financial indicators of the project is made on the basis of general data applied to production projects: the production of sodium humate at a price of 210,000 tenge per ton of product, with a productivity of 40,000 tons of product per year.

  • Sales volume from 2019-2023: 311 99,860 tenge
  • Net profit from 2019-2023: 21,320,708,743 tenge
  • Payback period – 21 months.
  • Average rate of return – 171.63
  • Net present income – 13,650,766,295
  • Profitability Index – 8.58
  • Internal rate of return – 53.7
Construction of a plant for the production of sodium humate 0

Project Performance Indicators

SV
311 99 860 tg
NP
21 320 708 743 tg
NPV
13 650 766 29 tg
PI
8,58
IRR
53,7
ARR
171,63
PP
21 months