Canadian Phosphate Reports $534K Q1 Sales, Prepares for 25,000-Tonne Capacity Boost

Steady Sales Growth and Customer Expansion

Canadian Phosphate Limited (ASX: CP8) closed the March 2025 quarter with cash receipts of $534,000 from rock phosphate sales, marking a modest increase over the previous year’s corresponding quarter. The sales momentum was primarily driven by powder and granulated phosphate products shipped to customers in the United States.

Looking ahead, the company anticipates a significant uplift in sales during the June quarter, underpinned by the completion of a major plant upgrade by one of its key customers. This upgrade is expected to increase the customer’s production capacity four-fold, targeting an annual output of 25,000 tonnes of granulated product that relies heavily on CP8’s rock phosphate as a critical input.

Strategic Positioning Amid Trade Tensions

Canadian Phosphate is strategically positioning itself to capitalize on evolving market dynamics, particularly the growing trade tensions between Canada and the United States. Historically, Canada has imported approximately 80% of its synthetic phosphate fertilizer from the US. CP8’s status as the sole provider of organically certified sedimentary rock phosphate in Canada places it in a favorable position to capture increasing domestic demand as supply chains potentially realign.

Advancing Exploration and Permitting

On the exploration front, Dahrouge Geological Consulting is finalizing an Exploration Target for the Wapiti phosphate deposit in British Columbia, with an announcement expected in the June quarter. This target is anticipated to support a significantly expanded mineral resource estimate, setting the stage for a drill program planned for Q3 2025.

Permitting progress is also notable, with Canadian Phosphate awaiting approval for a 10,000-tonne bulk sampling permit at its Barnes project in British Columbia. The permit’s expected Q2 approval will enable further testing of geology and product acceptance in the marketplace, with plans for an additional bulk sample permit at the Pump Station site to follow.

Financial and Corporate Developments

Canadian Phosphate reported a cash balance of $751,000 at quarter-end, supported by positive working capital of $117,000. The company holds approximately 8,000 tonnes of inventory in Montana, USA, valued at over A$2.6 million, with access to an additional 20,000 tonnes at the mine site. Operating cash flows reflect ongoing cost reductions, although sales were slightly below expectations partly due to delayed customer payments, which have since been resolved.

Corporate activity included a name change from Fertoz Limited to Canadian Phosphate Limited and the issuance of shares to directors and consultants as part of remuneration and placement arrangements. The company also maintains a $1 million debtors’ factoring facility at an interest rate of 12.95% per annum, providing financial flexibility.

Outlook

With key customer capacity expansion imminent, exploration milestones approaching, and a strategic foothold in the Canadian phosphate market amid shifting trade patterns, Canadian Phosphate is poised for a potentially transformative period. The company’s ability to convert these operational and market opportunities into sustained growth will be closely watched by investors.