Jordan Phosphate Mines

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Through the research we were able to analyze the internal and external factors that mainly affectJPMC, and from there we were able to conduct and formulatesome strategies to improve their position in the Jordanian mining and extracting industry.

Acknowledgment

We are grateful to Almighty Allah, for blessing us with the ability and courage to fulfill the requirements of this task.We alsoacknowledge Dr. SamerDahiyat for giving us all the needed information and tools to help us in this research.

1 Introduction

- Jordan Phosphate Mines Company (JPMC) overview

JPMC was established as a private company on March 1949 to exploit phosphate deposits in Jordan. It was registered as a public shareholding company in 1953 with an initial share capital of JD 250,000 and its current capital is JD 75.0 million.

JPMC currently operates through its subsidiaries (Indo-Jordan Chemicals Company, Ro’ya Transportation Company and Nippon-Jordan Fertilizer Company) four mines located in the center and south of the Kingdom, namely: Russaifa, Al-Hassa, Wadi Al-Abiad, and Eshidiya mines, in addition to the Department of Research and Quality in the city of Russaifa, and the Industrial Complex in the city of Aqaba, which aims at transforming the phosphate raw material into other products with added values.

JPMC's al-Aqaba complex produces fertilizer and chemicals, including; Phosphoric acid - used to make fertilizers, detergents, pharmaceuticals, steel and cola, Diammonium phosphate (DAP fertilizer), Sulphuric acid for many uses, and Aluminium fluoride used as a catalyst in the manufacture of Aluminium and Magnesium; used as a Ceramic glaze.

JPMC is the only entity currently operating under license to mine and produce phosphate rock in Jordan. In the year ended 31 December 2000, JordanPhsophate was the sixth largest phosphate rock producer in the world, the fourth largest exporter of phosphate rock in the world and the largest exporter in terms of revenue in the Jordanian economy. JPMC is the largest mining and industrial employer in Jordan.

The company operates its production activities in Jordan, which has the fifth largest reserve of phosphate in the world, equaling 3.7 billion tons, 1.25 billion tons of which are the reserves of the company’s mines. That made Jordan Phosphate Mines Company to be the second largest exporter, and sixth largest producer of phosphate in the world, with production capacity exceeding 7 million tons of phosphate annually.

The outcome of activities in 2014 surpassed the outcome of the comparable activities in the previous year 2013. Net profit which amounted to about JD 20.9 million in 2014 in comparison with JD 2.6 million in the year 2013. The net sales revenue was JD 738.4 million in comparison of JD 574.4 million respectively. The company assets attained a value of JD1211.4 million in 2014 compared to JD 1112.5 million for the year 2013. The equity shareholders reached JD 784 million in comparison with JD 762.3 million for 2013.

Phosphate uses

Phosphate rock is a vital natural resource and is the major source of phosphorus which is one of the primary plant nutrients. Almost 90% of the mind phosphate rock used in agriculture; primarily in the production of soluble fertilizers. The other 10% is used in chemical industries and is commonly used in livestock feed supplement, detergents. Pesticides, soft drinks, safety match heads, aluminum polish, timber, photographic films, tooth pastes, shaving, cream, soaps, cosmetics, textile dyes, gasoline and oil additives etc.Most of the phosphate rock is chemically processed into soluble fertilizer products, such as single super-phosphate (SSP), triple super-phosphate (TSP), nitro-phosphate (NP) and phosphoric acid (H3PO4). Phosphoric acid is the production of high analysis fertilizers, such as Mono-ammonium phosphate (MAP), di-ammonium phosphate (DAP) and compound fertilizers (NPK) (www.phosphate.com).

JPMCMissionand Vision

- Commitment to consolidate the values ofmining and phosphate fertilizer manufacturingto keep forefront of the international companies that meet the needs of their customers, local community, and national economy.

- Commitment to equally serve the interests of all stakeholders including shareholders, investors, borrowers and employees.

- Commitment to attain the latest developed products with low cost and high return to strive to be among the pioneering companies in the business of mining phosphatewhile preserving the environment and maintaining occupational safety.

1.3JPMCmining and fertilizing Services

- JIB Analysis

- PESTEL Analysis

This PESTEL analysis was conducted in order to knowabout the Macro environmental forces which Jordan Phosphate Mines facing. PESTEL (Social, Technology, Economy, Environment, Political, Legal, and Ethics) analysis requires considering the following broader external factors that could impactthe business prospects and the nature of the business activity. The organization interacts with the environment and draws certain inputs from environment, which are the transferred to the outputs.

One way of examining the external environment is through the PESTELor STEEPLE analysis, which evaluates the environment and can help the market there understand the main macroeconomic factor affecting the business (Mintzberg et al, 1996). A summary of PESTELanalysis can be used to check the reasonableness and validity of the overriding business strategy and targets. Any resultant issues should then be turned into an action plan that will describe how and when the organization is going to resolve such matters or mitigate the anticipated risks. For example, this might provide the rationale for why and on what basis the need of additional credit from the funding providers. This analysis of the external environment should be considered and applied when compiling, monitoring and reporting the organization future plans. (Wheelen, et al., 2014).

The following is the PESTEL analysis for the Jordan Phosphate Mines Company (JPMC);

- Social Factors

The company produces a wide range of products. However, marketing these products depends on three factors:

(1) The geographic location of both the products and consumers.

(2)