Territorial Dispute Halts Phosphate Rock Shipment from Morocco

Agrium (TSX:AGU,NYSE:AGU) saw its share price lose $0.40 by market close on Thursday (May 18) on news that a phosphate rock shipment from Morocco’s Office Cherifien de Phosphate (OCP) has been delayed.
According to Reuters, the 55,000-tonne shipment was aboard a Dutch charter ship called Ultra Innovation and was destined for the Port of Vancouver. But under a maritime court order instigated by Western Sahara’s Polisario independence movement, it was held in Panama on Wednesday night (May 17).
Western Sahara is disputed territory between Polisario and Morocco, but last year a European court ruled that Western Sahara should not be considered part of Morocco in EU and Moroccan deals. OCP mines phosphate in the Moroccan-held part of Western Sahara, and Polisario officials have claimed that its shipment to Agrium is illegal.
Agrium issued a statement saying that it is working with Ultrabulk, the owner of the charter ship, to resolve the situation. The company uses phosphate rock to produce fertilizer at a facility in Alberta, but does not anticipate any interruptions there.
Todd Coakwell, Agrium’s director of investor relations, also said that the company conducted an independent assessment in 2016, and determined that buying from OCP would not lead to negative human rights outcomes in Western Sahara. Coakwell added that it would be “difficult” to find a new supplier in a short-term period.