Can Bangchak Compete in S.E. Asia’s Growing Potash Market?

Thailand's high-quality potash deposits hold enormous potential, but development has faced significant hurdles.  Operational costs, environmental challenges, and logistical hurdles have slowed development.  Additionally, the global market for potash is competitive.  Legacy producers have significant cost advantages.

Laos-based producers benefit from lower production costs, strong Chinese investment and proximity to the Thai market.  Sino-Agri Potash (Sino KCL) in Laos have increased their market share in Thailand from less than 5% in 2019 to 22% in 2024 (187,200 tons).  They plan to increase their capacity from 2 million tons to 5 million tons per year by 2025/26 and eventually to 10 million tons per year. 

The other major potash player in Laos, Lao Kaiyuan currently has a capacity of 1 million tons and plans to double that by the end of 2025.   Three other ongoing projects near the Laos capital of Vientiane are funded with Chinese investment:  Sino Hydro Mining (2.5m mt/year), Ruiyuan Richfield Sylvine Sole (500k mt/year) and Zangee Mining (2.0m mt/year).  

Two other undeveloped MOP projects in Thailand (Chaiyaphum and Udon Thani) are currently being reviewed.  Reuters recently reported that China’s SDIC (the largest SOP producer in the World) was looking to acquire 49% of the MOP mine in Udon Thani, Thailand. 

While Laos-based producers are growing rapidly, global giants like Eurochem and BHP are also increasing capacity, adding pressure to an already competitive market.    

Bangchak’s success will ultimately hinge on its ability to manage development and operational costs and make a profit at market prices.  Potash demand will be there.   

Bangchak Invests in Thailand’s Potash Potential

Article: Bangkok Post, 17 Dec 2024, B2