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ITRONICS
DESCRIBES STRONG OUTLOOK FOR ITS GOLD?n
GRO LIQUID FERTILIZERS
- Growth Potential Driven by Environmentally
Green Clean Technology -
RENO, Nevada, June 18, 2009 -- Itronics Inc. (OTC:
ITRO.pk; Frankfurt and Berlin Stock Exchanges: ITG), said today that total
Company sales for the first half of 2009 are expected to increase about 20
percent.
The demand for the GOLD’n GRO fertilizers
continues to increase, but limitations on funds available to purchase
ingredients for manufacturing our fertilizers is restricting first half GOLD’n GRO sales growth to about 15 percent, said Dr.
John Whitney Itronics President. He said that
while the national economy is struggling, Itronics
Metallurgical, the Company’s wholly owned subsidiary, is benefiting from
strong demand for silver and increased silver prices.
Dr. Whitney, in answering recent investment inquiries, said:
The majority of fertilizer sales are being made through the Company’s
distributor to specialty crop growers in California. In the second quarter 2008
the parent company of our distributor acquired a major competitor, integrating
the acquired company and its retail outlets into its existing retail
distribution system and increasing the number of its nationwide retail outlets
from more than 500 to about 800. Itronics
distributor is now one of the largest U.S. agriculture retail
companies.
As a result of the merger, our distributor added 21 retail branches in Arizona,
California and Hawaii for a total of 56 retail outlets in these states, a 55
percent increase from 2008. The merger and the resulting increase in
distributor sales force and geographic coverage created an opportunity for
strong growth in GOLD’n GRO orders this spring.
For the past 3 to 4 years several of the California based distributor retail
branches have been working with their large California based corporate growers
to introduce one or more of the GOLD’n GRO
fertilizers. This year several of those corporate growers placed one or
more truck load orders for the first time. Included in these are two of
the largest farming companies in California. Order placement with our
distributor is a vote of confidence for the cost effective benefits of using
the GOLD?n GRO fertilizers.
Ongoing expanding use by these large operations is expected to significantly
increase the demand for our fertilizers in California in future years.
Most of the fertilizer sales are for specialty crop production in California
which is strongly seasonal with a spring season that usually starts in the
second half of March and ends in the first half of July.
Peak months are April and May. Typically there is also a fall season
which starts in late September and continues through mid December. In a normal
year, about 70 percent of GOLD?n
GRO sales are generated in the first half of the year. The Company is
working to diversify sales to reduce the seasonal concentration.
A very sharp seasonal spike in fertilizer orders in the spring creates an
equally sharp increase in the need for cash to buy fertilizer ingredients to
make the fertilizers. This year, because of the collapse in the U.S.
financial markets, the Company was unable to obtain financing needed to fill
the seasonal surge in orders. As a result, almost all of the Company’s
cash receipts are being focused on purchasing fertilizer ingredients to fill
the orders. This created a new operating concept, ?financing
capacity, for Itronics Metallurgical, versus normal
operating limitations of ?manufacturing capacity.? By agreement with our
distributor, supply is being managed to provide available fertilizers to retail
outlets that already have a GOLD’n GRO customer
base. New sales development is currently on hold. By closely
coordinating with our distributor we have been able to keep most of the retail
outlets supplied with critically needed fertilizers. Financing capacity
is limiting the Company’s output to about two-thirds of single shift
manufacturing capacity.
Itronics Metallurgical has become an important
western U.S. manufacturer of Chelated Nutrient Metal
micro-nutrient fertilizers. It now offers 7 micro-nutrient fertilizers,
but sales are currently dominated by four of these which are listed in
descending order of importance: (1) GOLD’n GRO
9-0-1+7% Zn, (2) GOLD?n GRO 9-0-2+3% Zn multi-micro
mix, (3) GOLD’n GRO 10-0-0+4% Fe, and (4) GOLD’n GRO 10-0-1+3% Mn.
This year, manufacturing has been limited mainly to production of these four
fertilizers. The orders are being filled and the order back log is being
reduced. Most of the manufacturing is still focused on filling orders for
the GOLD’n GRO 9-0-1+7% Zn which is the most
popular GOLDn GRO micro-nutrient fertilizer.
Large scale applications of GOLDn GRO 8-8-8+4% S
fertilizer in drip systems (fertigation) on crops in
coastal and central valley areas in California in 2008 demonstrated that this
fertilizer can be used safely in fertigation
applications in locations that have hard water. This is not normally
possible using conventional phosphate-bearing fertilizers. The GOLD’n GRO 8-8-8+4% S is manufactured in bulk under
license by our distributor at a location in central California, which improves
availability and reduces shipping cost for bulk deliveries to the central
valley and coastal retail branches.
The Company, working with its distributor, has completed development of a new chelated micronutrient fertilizer, GOLD’n
GRO 9-0-0 Iron Man Z?. This fertilizer which was
developed in response to customer requests, fills a nutrient gap, and is
targeted for use in the turf and ornamental market, and for use on vegetables,
trees and vines. Registration has been applied for in California,
but has not yet been received. With the addition of this chelated micronutrient, the Company now offers seven chelated micronutrient fertilizers, and six chelated multinutrient blends,
for a total of 13 GOLD’n GRO specialty
fertilizers. The GOLD’n GRO Guardian Deer
Repellent is a biopesticide and so the Company is now
also offering one biopesticide for a total of 14
products. National recognition of the GOLD’n
GRO Brand is now also being achieved.
Introduction of the GOLD’n GRO Guardian Deer
Repellent fertilizer is expected to produce summer and fall sales which would
partially mitigate the seasonality issue. Sales development for this
product has been on hold due to financing capacity limits, but plans are being
implemented to start sales as soon as the peak fertilizer season is over.
The GOLD’n GRO Guardian is now registered in
eleven states, including New York, and registration was recently applied for in
Virginia.
The Company has also been implementing a sales program for the chemical
injectors (Chemilizers) that are used for injecting
fertilizer (fertigating) into drip and sprinkler
irrigation systems in green house nursery operations and for up-scale
homes. Locations that install the chemical injectors are set up to use
one or two of the GOLD’n GRO fertilizers.
GOLD’n GRO 8-8-8+4% S is typically used by the
green house nursery operations. GOLD’n
GRO 15-1-8+4% S and GOLD’n GRO 20-1-7+3% S are
being used for fertigation of lawn and shrubs by
sprinkler systems, and GOLD’n GRO 6-3-9+4% S is
being used for drip irrigation of flower beds, roses, and garden vegetables.
The Company is working with the largest fertilizer distributor in Utah and now
has more than a dozen green house nursery and lawn fertigation
installations in Utah. In 2008 the Company began working with a landscape
maintenance company in northern Nevada which now has almost a dozen
installations. This project to sell fertilizer injectors in the nursery
and landscape maintenance markets, while still small, has been under
development for several years and is now starting to make a contribution to
sales growth. These market segments are also expected to mitigate the
seasonality by spreading fertilizer demand over longer growing seasons.
Demand growth for the GOLD’n GRO fertilizers is
now being driven by excellent field results obtained with their use. In
2008 the Company’s agronomy staff finished a peer reviewed research
summary of how GOLD’n GRO fertilizers should be
able to increase the availability of phosphorous and nutrient metals applied as
fertilizers to the soil for growing crops. The research summary suggests
that the unique chemistry of the GOLD’n GRO
fertilizers is beneficial when applied to the soil by improving the
availability of phosphate and the nutrient metals including iron, zinc,
manganese, calcium, and magnesium. A related benefit is that fertilizer
residuals, to the extent they occur, are used as a nutrient source by soil
microbes providing virtually complete use of the fertilizers. This is the
other Green aspect of the GOLD’n GRO fertilizer
technology.
One of the emerging national fertilizer needs is to be able to apply manganese
fertilizer in glyphosate (Round Up, a weed spray)
spray mixes on Round Up Ready corn and soybeans (these
plants have been genetically altered so that they are not damaged by the weed spray).
Initial tests with GOLD’n GRO 10-0-1+3% Mn in the fall of 2007 produced very satisfactory results
on Round Up Ready corn. In 2008 Itronics Metallurgical worked with one of its fertilizer
ingredient suppliers who put out trials on Round Up
Ready soybeans in several states. The GOLD’n
GRO 10-0-1+3% Mn was found to be compatible with the glyphosate spray mixes and crop response was acceptable.
The supplier has an extensive nationwide liquid fertilizer distribution system
and is fully capable of introducing the GOLD’n
GRO fertilizer in relevent markets in the midwest and southern United
States where both corn and soybeans are major
crops. This market is large, but would be strongly seasonal, so when Itronics Metallurgical is able to support the expansion
with adequate funding and manufacturing capacity, market development can be
initiated.
The GOLD’n GRO nutrient technology is providing
economic and environmental benefits that are driving expanding demand. Use in fertigation reduces application costs and quantities
required. Improved availability to the plant roots in the soil of
phosphorous and nutrient metals after several years of use is now reducing the
amount of fertilizer needed to provide satisfactory plant nutrition. This
produces both economic and environmental benefits and increases customer
loyalty.
Itronics, through its subsidiary Itronics
Metallurgical, is the inventor and operator of award winning recycling
technology that converts spent photographic liquids into pure silver and GOLD’n GRO fertilizers. Commercialization of
this technology has created a Green Consumer Option for photo and x-ray processors
and Green fertilizers for horticulture and agriculture. The fertilizers
incorporate the ESSENCE OF GREEN because of how they are sourced and because of
their excellent performance in the field.