Morocco’s OCP raises $1.5 billion in first international hybrid bond

OCP S.A., Morocco’s state-backed phosphate and fertilizer producer, has returned to global debt markets with a $1.5 billion hybrid bond, its first issuance of this structure and one that drew strong demand from international investors despite a cautious start to the year for new deals.

The transaction was split into two tranches, offering investors different maturities and yields. The 2031 portion was priced with a 6.74 percent coupon, while the 2036 tranche carried a 7.37 percent coupon. The bonds were arranged by BNP Paribas, Citigroup, and JPMorgan Chase, reflecting continued involvement from major Wall Street lenders in emerging-market financing.

Fertilizer bond demand rises amid disruption

Investor response was notably strong. The order book reached about $7 billion, 4.6 times the final size of the deal. In total, 176 investors across 23 countries participated, allowing OCP to increase the issuance from its initial target. The scale of demand suggested steady appetite for investment-grade African corporate credit, even as global borrowing costs remain elevated.

The timing of the bond comes as fertilizer producers face shifting supply conditions tied to disruptions in global shipping routes and tighter commodity flows. Sulfur prices, a key input in phosphate fertilizer production, rose about 35 percent in April compared with levels seen before recent regional disruptions.

OCP builds sulfur buffers, diversifies supply

Despite that increase, OCP said it has built sufficient sulfur inventories to maintain production through at least the end of June. The company has also widened its sourcing base, drawing supplies from Kazakhstan, Canada, Europe, the Gulf of Mexico and the Red Sea region to reduce dependence on any single corridor.

The group is 94.12 percent owned by the Moroccan state, with minority shareholders holding the remainder. It continues to work with the International Finance Corporation on governance, risk management and compliance programs as it expands its industrial operations.

Alongside the bond sale, OCP is advancing additional financing tied to industrial development projects. These include a proposed corporate loan of up to €95 million ($111.33 million) linked to a wider €190 million ($222.65 million) program focused on industrial waste management within Morocco’s phosphate sector. The funding mix reflects a combination of capital markets activity and project-based financing aimed at supporting operational upgrades.

OCP raises output adjusts maintenance schedule

OCP remains the world’s largest exporter of phosphate rock and phosphoric acid. Output has increased significantly over time, reaching 16 million metric tons in 2025, compared with 3 million metric tons in 2008, according to company figures.

The company is also adjusting its product mix. It is increasing output of triple superphosphate, which requires less sulfur and no ammonia compared with diammonium phosphate. The product accounted for about 30 percent of production in 2025, with plans to move above 50% in 2026 as input costs remain under pressure.

Earlier this month, OCP brought forward scheduled maintenance into the second quarter, a move expected to temporarily reduce production by about 30 percent. The adjustment adds near-term limits to output even as the company continues to secure funding and manage longer-term investment plans tied to global fertilizer demand.