Upstart Australia-based fertiliser company Marnco has moved to make changes to its product’s name and compensate farmers after a rocky start to its entry into the New Zealand market.
The company entered NZ late in autumn with a shipload of largely super phosphate, aiming to prise some market share from the two big incumbent co-operatives Ballance and Ravensdown.
However, it found itself drawing fire from the Fertiliser Association of NZ (FANZ).
The association moved quickly to seek a court injunction against Marnco for selling what it said was not valid superphosphate.
This was on the grounds that the product failed to meet the 8% standard set for super by the FertMark code. Marnco’s was testing at 7.4% phosphate and was also claimed to be lower in solubility than what the FertMark standard was.
Marnco managing director Mark Been said the company has acknowledged the discrepancy and had moved to rename its fertiliser “SulPhos”.
Meantime the company also continued to investigate the discrepancy between its content and the targeted content.
“And every farmer customer who purchased product off us has been compensated for it, with us paying the difference in the content, plus any re-application costs. The feedback we have received is that everyone is happy with this.”
Acknowledging that it was not a “fun entry” to the NZ market, Been said he is confident Marnco’s actions should mean the impending court case is no longer necessary.
“We can hold our heads high that we have addressed the issue. We have owned the issue, customers have said they are happy with the outcome. We also have to remember that FANZ is not a legal entity or regulator.”
Dr Vera Power, chief executive of FANZ, said it is no longer necessary to proceed with legal action against Marnco in light of the changes the company has made.
“Our action was about the product, not the company. We were never in opposition to Marnco selling or promoting its product in NZ. Our concerns related to any representations made about the fertiliser, especially when these are not consistent with the FertMark code.”
Been said he was conscious of the need to “choose your battles” and hoped to see business start to take off come springtime.
Meantime he attributed the significant drops in fertiliser prices farmers have witnessed in the last few weeks to his company’s presence in NZ.
“Urea started out at $895 a tonne, we put it at $850 at King’s Birthday weekend, then Ballance came down to $795, we went to $787, and Ravensdown to $799. We have already seen $100/tonne come off, and $70/t on sulphate of ammonia.”
He said the irony is that prices are tumbling just as the global market is starting to head north again in prices. China has put an export ban on its nitrogen products, tightening supply again.
Been said Marnco is still considering whether it will join FANZ.
