Investor Update

Jan 21, 2021

Slides

Hi, everyone. My name is Cristiano Veloso. I'm the Founder and CEO of Verdi AgriTek Plc. I thank you all very much for attending this questions and answers session. If you are attending this event live, I thank you and we'll explain how it will work today. Every one of you at the bottom of your screen, there is a question Q and A button. You can type in you can click and type in any questions you may have. We have received several questions over the last few days and Isabella has very gently compiled a list with all those questions, and she is right now adding all of those questions to the Q and A box. You will be able to vote for the questions you want to be answered first. And as you vote, this question will move up in the order of priorities. That way, if your time is short, I will be able to answer your questions sooner. And for the other questions, we can stay a bit longer during this call. For everyone watching this video on YouTube, thank you very much for the interest. If you like this presentation, the other material you've seen on our channel, please subscribe to our channel, so you can get the updates as soon as a video a new video becomes available in our YouTube channel. Also, please make sure you share any video you like with other people who might be interested in joining our journey. Before we begin answering the questions, as usual, I will ask you all to hold a minute of silence thinking about all the ones we've lost during this terrific pandemic and thanks for doing that. Thank you. Recently, someone asked me when I asked why I do that in the beginning of every call. And my answer is, it has been a very we've had some very happy days at Verde with the growth, with everything we want to achieve. And of course, it's natural to be excited in this video. But by holding this 1 minute silence in the beginning of the call, I just it's just a way to acknowledge the suffering. So many of us who have lost people very close to us and other people and anyone was drastically impacted by this pandemic is coping with it. So starting now with the questions. The first question is, has revenue from backs been assumed in the 2021 guidance? If so, how much? The answer is yes. We've assumed in our guidance for 2021 some revenue for bags. How much we are not in a position to disclose what percentage of our 2021 expected sales would come from selling bags. The other question is what will the price per ton for bags be? Very good question. And of course, the answer will depend on the composition of the product. So some farmers might want to have a higher concentration of boron than some other farmers who might have a higher concentration of sulfur, for example. So depending on the concentration of the nutrient, we will have different prices per tonne. The pricing mechanism though doesn't change. So we still sell the product. So it is delivered and applied to soils in a competitive manner to the equivalent fertilizers. So we're still sticking to what we've said all along that by that when a Brazilian farmer switches from conventional chemical fertilizer to bags, there isn't an increase in the cost. The contrary is more often true, especially with the addition of sulfur, they will be able to reduce costs. The other question, just remove the ones I've answered. So the other question we have here is, there are many blenders in Brazil who are mixing fertilizers for farmers. What differentiates you from them apart from the fact that you have glauconite? And if that's the answer, that's fine. It's a good question. So what differentiates us from them in a negative way is the fact we sell product as a powder, as a dust and blenders will sell fertilizers as granules. And a lot of farmers for different reasons, they still prefer to buy granulated fertilizers. What differentiates us positively from blenders is that we can be much more cost efficient when we include certain nutrients to our product. So for example, sulfur. If a blender wants to add sulfur to a certain NPK blend, they will have to rely on sources of sulfur, such as super simple phosphates, ammonium sulfate, which are way more expensive to them as blenders and especially to the farmers than the source of sulfur we can procure. So the advantage and disadvantage that would be the short answer. The other question is what's the total cost on average of production of packs and what is the expected added value revenue? Again, it's a very different it's a difficult question to answer because it depends on the composition. But to illustrate, a one of the compositions we're selling the most would be to add 2% of sulfur and 0.2% of boron. So when we add those nutrients to our product, In terms of industrial added cost, it's irrelevant, the added industrial cost, absolutely relevant. What is relevant is the cost for you to procure those nutrients. And the cost, for example, of elemental sulfur and the price we can sell it on to the farmers, we can be looking at a margin between 20% to up to 40% on that sulfur. When you look at Boron and you look at the costs we can procure, get to deliver to the plant and the cost we're able to sell it on, the margin is a bit smaller, you're looking at around 15%. So if any of those questions, if you feel like I didn't answer them completely, please make sure you go down and either ask the same question again or perhaps try to stress whichever point you thought I didn't address. The next question and we have 40 questions if you're watching it on YouTube so far. The next question is how closely is Verdi working with miniaturized state and the federal government to help maximize its chances of becoming a key provider of fertilizer products to Brazilian farmers. What else needs to happen before Verdi can wield some true influence and become a significant player? That's a very good question. We're working closely with both state and federal governments. They've been aware of everything we're doing. They've been providing as much support as they legally can all along our journey and I'm pretty confident they will continue doing so. I think the last environmental license we got issued for 2,500,000 tons, which was applied for in March 2020 and was issued in December 2020, I think it helps to illustrate how committed everyone in the country is to see the day succeeding. What else needs to happen for Vezkeny, who put some true influence and become a significant player? I think the answer to the second question is, we need to deliver. We need to carry on executing. We need to carry on growing our market share. We need to carry on making sure farmers understand the benefits of our product. And the reason with those things, it's not about magic, it's about hard work, how the everyday work and that's what and where we are truly focused on. The Brazil potash project is recognized by the government, it's 1 of 8 projects of national importance. Is there any chance you're always being recognized as such, so when? This is a mention to some projects that have an enormous capital expenditure, projects that have a gigantic environmental impact and projects that are suffering a lot of problems with communities, a lot of problems with feasibility and the government has created something like that, which let's hope it will help them all. Our project and how we've been developing it and the relationships we already have and how things are progressing just hasn't been necessary. Is it just that you're going to be adding sulfur to K40 in accordance with how much each farmer wishes you chew? Or is there some proprietary science here, which justifies the technological badge you wish to put on the business? The short answer is yes. We've applied for patents and the technology came up after several discussions between me and some of our teams, some of the consultants, scientists who consulted for Verde at some point, some industrial people and to illustrate how there is IP on what we've done. Some of the contractors who were paid to go and build what we designed, after they executed the work, after they were paid, they turned to us and said, well, we really never thought it would work. We would bet as much money as we wanted that what you wanted to do wouldn't be possible to be accomplished. So we are happy about how it's been how those technologies are being developed and the added value it will bring to Vale as it grows. With 2,500,000 tons to ship each year, how are you going to get 50,000 trucks in and out of your mines to the plots? And then to the customers each year, we need to start getting an understanding of the logistics here. Yes, we've done logistical studies and it's a big number when you look at it. But when you look at the number of vehicles per unit of time, when you look at other operations in the state, which move up to 10,000,000 tons, 10,000,000 tons of, for example, iron ore. It's not something very different we're proposing here. We believe that up to a number of around 10,000,000 tons, we should be able to sell it by truck. Above that number, then you start getting a greater impact on roads and you will have to look we will have to look at setting up a rail connection. Of course, for there will be CapEx required in terms of improving a road of approximately 20 kilometers that goes from where the plant is right now to where the mine site is. So that is an improvement we will need to be doing and it's accounted for, for example, in our pre feasibility study. You mentioned the market in dollars for sulfur in the world, but how big is the market in Brazil? It's big. The number will be available in our pre feasibility study much later on this year Or perhaps, we might even do something we've done in the past, which is to do a press release with the market study once it's completed by an independent party. We don't know yet. But sulfur is the most strategic nutrient in Brazil. As far as offering a nudge in terms of market development is concerned for any product for the reasons I explained in the technology launch video. And if anyone wants me to go into detail again for the reasons, please make sure to ask a question here and I will address that as well. In light of the development of the new product offer of Bags, what is your new production guidance? It remains unchanged. It's what was disclosed. What's the expected production for 2022? I don't know. We know what we expect to do in 2021 as it was disclosed. I think we let's see how the first half of the year goes before we start making guidance or projections for 2022. One point auto and anyone watching our video on YouTube and it's I just had a call right before this one with one of the companies we're talking to you about doing the market study and we're talking about market share. And I was telling them something that for us InVerde is part of who we are. When we look at the size of our mine, when we look at the benefits the project has for the planet, for everyone's health, for the farmers, for the farmers' bottom line, We have the obligation to sell as much of that mineral as fast as we can. The consultant was talking about my ambition when I was talking to him about 60% to 80% of the market share and I had to correct him twice. Ambition is when you have a gold, iron ore business or any other sort of business and you want to grow, you want to have a bigger market share because you want to be bigger for different reasons. In the case with Verde, it's different. We have the obligation. And if we aren't good enough as a company, as a team to do that and to grow it and to maximize as much as we can from that mineral assets for the benefits of the planet and Brazil, when the farmers are fast enough to do that, we should get out of the way and find someone else who can grow it as fast as it has to be grown. It's an obligation. It's not optional. It's not an ambition. And that's how we work and that's how we've been working every day. As people say, Rome wasn't built in a day, and we acknowledge that. It's a new product, has all the challenge, but that doesn't change what we all recognize as being our obligation. Next question, how is the structure of your loans? What is the percentage of your loans that are associated with IPCA? There is a table in our management discussion analysis filed on SEDAR, also available in our website, where there is a breakdown with each one of the different loans we have and the terms for each one of them and what the ones which are associated with IPCA. So I'll refer you to that material, which is updated quarterly. Next question, please can you confirm that you're currently permitted to mine 480,000 tons of pay in 2021 plus 120,000 tonnes unused from 2020. I confirm the 480,000 tonnes, which is what is on the new item. The amount which was brought in from 2019 2020 to 2021 wasn't as great as the 120,000 tons. I think by memory and please forgive me if I'm wrong, I think it's about 25,000, 30,000 tons. But what we can do is to add a line on the monthly update for January disclosing that, but it isn't something material. How are such large amounts of unrefined element of sulfur to be obtained, trucked and then amalgamated without impacting margins. All of the economics and logistics of this new product rollout were unclear. Unrefined elemental sulfur comes from oil refineries. That's the main and cheapest source of unrefined elemental sulfur. Some companies in Brazil, they import unrefined elemental sulfur from the Gulf, Saudi Arabia and some companies in Brazil, depending on where they are, if they have an oil refinery nearby, they source it locally. In the case of Verde, we are lucky that there is an oil refinery about 300 kilometers away from where the project is. It's called Refinaria Gabriel Pazos, just outside Belo Horizonte, where we're all from, and it's owned by Petrobras and that's where we are sourcing it from. The pricing though, Petrobras charge is in line with international sulfur prices, international refined elemental sulfur prices. The edge we have is that the competition, the other sources of sulfur or of fertilizers with sulfur, their technologies do not allow them to process it and incorporate it to the product as cost efficiently as we do. So they operate with from much greater costs than we have. And that's how we can achieve the margins I referred not long ago, anything between 30% depending on time, the year up to 50%. Okay. Let me dismiss this question. So the other question, how much capability has Verde got in the technology area? And how much needs to be farmed out to labs? How scientific do you need it to be? Or is it just a question of responding to each farmer's demands? It's a very good question and I presume you're talking about the final product composition. If that was what you're referring to, which I think so, the answer for your first question is that we have a lot of internal capability in terms of human resource, in terms of PhDs and experts in agriculture. How much needs to be farmed out to labs, it's commodity type of work. So for example, doing a soil analysis, doing certain types of assays, which anyone can do, it's just a commodity, we do that with external labs. How scientific they should be, just a question. I think that is a brilliant question, the second one, and it's how we can demonstrate the value our product can generate to farmers. And one of the things I'm so happy about this, if you can say that about this crisis, good job with the 1 minute silence, is that it taught us how effectively an organization can be relying on its people working remotely, providing you have the right tools to find and hire the sort of people that thrive working remotely. Not everyone is like that. Some people do will always need the social atmosphere of an office and but not but people are different. And we've been lucky to be able to target that. We've been lucky that this allowed us to significantly grow the area where we could recruit people from in Brazil. So we've brought some amazing human talent, PhDs, people with wide array of experience from different commodities and this is again and will be seen, I can bet, one of the reasons we will carry on succeeding as we grow. The next question, It may be useful for you to say a few words on what a great year Brazilian farmers had in 2020, how this normally leads to more investment into their farms and the outlook for potash prices in 2021. Yes, farmers made a lot of money. It's a lot of money. Soybeans, all the agricultural commodities have been at fantastic prices, coffee, cotton, corn. And on the top of that, the Brazilian currency has weakened significantly. So they sell in strong currency and pay most of their costs in Brazilian reais. So there will be quite a few new plants sold in Brazil for farmers. Yes, farmers are passionate about what they do. They love buying more land. They love investing more. They love growing the planted area. They love buying more equipment. So we can see a we can see that in terms of pretty much every farmer talking about how they're looking to expand the planted areas. And in terms of outlook for potash price in 2021, there is some conversation about people asking as much as $2.60 CFO for potash. There hasn't been much liquidity in that price as far as we were, but there would be about 10%, more than 10% growth on prices realized at the end of last year, which were around 2.20 dollars Some people talking about seeing potash prices going back to the 300s, to the 400s and I don't know what's going to happen. I don't think that will happen. I think this is what we're going to be seeing around 2.60, 2.50, thereabouts. I don't think the players who control potash supply, I don't think they will want to gigantic project in Canada. And every time BHP talks about effectively commissioning it or going forward with it, the price comes down and the current players talk about how much capacity they still have and how there is no need. And so we're going to we'll see. Next question. We have 32 questions or another 32 questions. Anyone watching on YouTube. So if your average debtor is going to take a year to pay, you're going to this isn't true. So the average debt doesn't take a year to pay. We can perhaps start putting that down in the management monthly management report, but it's the average, it's about 3 months, 2, 3 months. You're going to either need some very significant facilities or you're going to need more capital. Well, if you look on our management document, you will see that we have already a line, which is about BRL 20,000,000, significant amount of money to fund farmers that want to have a larger amount of time to pay us, and we hardly use that money. I think out of the BRL 20,000,000, we use like EUR 100,000 just to test how it would work or so we haven't needed that. But yes, as we grow, there will be the additional need for more capital, but we've been very good with the relationship with the banks and all the financial institutions in Brazil to back us as far as that is concerned. So how are you going to pay for your new plant in H2 next year with all this working capital tied up in debtors? We are having those conversations. We're looking at the funding package. Of course, we will be generating more sales this year, more cash flow. So when we come in and press release the CapEx for the new plant and the more final timeframe, we will be press releasing the financial package, which was required. But one thing is that we won't need to raise any new equity. We're confident that everything can be done out of accumulated cash flow plus additional debt. What are your plans regarding Verdes sales team ramp up? We are hiring as fast as we can, as many people as we can and as good people as we can find. And we carry on doing that. One of the books I read over New Year's, Christmas is From Good TO Great, fantastic book. It's not a very new book, but still great. And one thing, one sentence there, which gets repeated often is you need to get the right people on the bus, you need to get the wrong people off the bus, you need to get the right people in the bus on the right seat. So that's what we carry on doing. And as Jack Welch also likes to say, he has never regretted firing someone too quick. So we have some principles in Verde, which we care a lot about, very important to note what we're doing. We are very committed to having the greatest level of talent of any agri tech company in the country. So we do make sure we are hiring the best and we're trying to keep on the best in the company. We deeply agree on that when you have a team, your team will be just as good as the worst person you have in your team. So we make sure we follow Jack Welch and others and we fire people as fast as we can. And also the other thing we do in Verde, we don't steal anyone's time. So if we feel that someone isn't good enough for the company for what we're trying to achieve, we fire the person straight away, so the person can find another company where he can be happy. So that's Verde. Auto quota, another question, what is the biggest challenge to growth of the production? Sales, bureaucracy, technical issues, logistics, it's all of the above. People is true reason we've been able to grow at the pace we've been growing around 100%. But our growth has been so fast that you need to change the company every 2, 3 months in terms of internal procedures. They keep changing. You keep adding a layer of complexity. You need to start changing how you do the segmentation of your customer service. So it's all this growth, which is our which is a good challenge and it is our challenge. Another great book about that is by the co founder of LinkedIn. It's called blitzscaling, which helps to which really illustrates what we're going through. And more importantly, it helps with a roadmap on what you should be doing, what you shouldn't be doing to succeed in a situation like that. The other question is, have you got any pre orders already from customers for bags? Yes, we have pre orders and yes, we've already shipped, we've already dispatched, we already have bags being used by some of our customers who took delivery of the product already in 2021. How much bags will you be able to produce at your facilities as they are configured? Should they well, we could essentially have 100% of all production as bags if there is demand. Is there a process where Verdi could change its product powder form to granular? Yes, there is a process. We've invested in that process over the years. We control it. We've improved it significantly. It's another technology we've developed. If you're in the United States or Canada, you can actually go on Amazon and buy our product as granulated. And for the local for the Brazilian market, at the moment, we are focused on powdered and but in at some point in the future, we will also be offering granulated product to the local market. What percentage of total sales is PAX estimated? We won't be disclosing this at the moment. What are your sales? We won't be disclosing that at the moment. Can you please provide an explanation as to why you decided to change auditors mid year after having received shareholder approval at the AGM. We changed auditors because they were just as good as the ones we previously had and they were more cost efficient than the ones we were using. And they were actually PKF. They were the auditors we first used in 2007 when we went public. The second part of the questions, when to change mid year, we changed auditors when it got to the point when we've historically always engaged auditors. So historically, token system went public in 2007, Every November, we would get a quote from the auditors. We would have a planning call with the auditors and we would try to argue for discounts on the fees and we would go forward. When it came to this year, we had a few quotes from several different auditors for the year, which is to be audited of 4th 2020. Our calendar year ends our fiscal year is this calendar year, so it ended December and we changed what it is when it was the time we usually would hire them. I think that would be the answer. In 3 years' time, what's your guess about Verdes sales will be split pure K40 new products? Well, because it's a guess, I think in 3 years, up to 90% is going to be Bax. How long is it going to take for the average farmer in Brazil to buy into our story and do away with KCL? Or do you believe that many will remain loyal to what they know? So two questions. So how long is it going to take for the average farmer and researcher to buy into our story and do away with KCL? It depends. I mean, it depends. We have farmers who switch straight away and they're very happy with farmers who tried it for 2, 3 years before they switched completely. So it varies a lot. So I don't have an answer to this question. What I should say though is don't take farmers for granted. Never take pharmas for granted. It's not because you bought your product 1 year that the following year, he won't go back to KCL. We saw that happening, unlike for reasons as silly as Verde failing to call the guy back and reasons as silly as the farmer's son-in-law working for a different fertilizer company and selling him KCL or a distributor packaging up a bunch of products and offering a very competitive rate on KCL, on potassium chloride, but making up the money in other products. So it's going to be every year the same fight, the same challenge as if it was the first time he was deciding whether to buy for K40 or not. At least that's how I like to see it. That's how I like to communicate with our sales team. But yes, of course, if the guy if the farmer has used it and he's happy, it's a bit easier than offering a brand new product. Is it possible that the government will help push farmers towards your products? No, no. I mean, that's just it's not what the government that's not what governments do. That's not what any serious government should be pushing a product or telling pharma to use A, B or C. It's not how it works. It will provide a competitive environment for the products in the marketplace. It doesn't matter if it's imported or if it's national. It will provide a fair market environment and will be down to the companies to convince the farmers to demonstrate the benefits. It will be down to the farmers to decide what they will use. Why was there no real substance to the technology presentation on December 2015 and no opportunity to ask questions? I feel sorry you felt there was no substance to the technology presentation. We did our best. I hope if there's any specific question about technology, you may ask the questions here, we're happy to answer. No opportunity to ask questions was because it would be a bit challenging to do that from a sugarcane field and we thought the technology deserved a real site location rather than myself and Zoom talking about it. We thought it would be a bit more interesting and technology deserved it. But as always, we're happy to answer any questions and address any points to the best of our capability. How are you going to develop your sales channels so that investors can start to see your potential? At the moment, the market doesn't believe you're going to get to 1,000,000 tons of sales per annum, never mind 25,000,000 tons. This disconnect needs to be addressed. Well, I think that's the $2,000,000,000 question, dollars 2,000,000,000 being our NPV. So if any of you on this call or if any of you can help us figuring it out, how we can improve our communication, So this disconnected is addressed. Please share your thoughts. We will listen to all of them. And in the meantime, until there is something that really would make sense, we're going to carry on doing our hard day to day work of talking to farmers and helping them to grow food more sustainable, more cost efficiently and with as much passion for their farming activities as we have for what we are trying to accomplish at Verde. What pressures are there on logistics at 250,000 tonnes per annum minor, minor, minor pressure? That's what we moved last year. I think there are lots. Next question, can you make Verde less dependent on Q3? Or are the rains and the times the farmers apply their fertilizer always going to make this the dominant quarter? The answer to the second part of the question is, yes, rains and the timing for fertilizer application when you look at 2 of the or most of the systems, the agricultural systems, the crops which require more fertilizers collectively, Q3 is always going to be the dominant quarter, no doubt. The answer to the first question is also yes to the first part of the question. So yes, we can make it the less dependent. And how we're doing it, we've identified no secret, but certain crops, which would have a greater demand in especially Q1, late Q4. And we've been doing trials and market development with some very large players in those sectors, which if successful, we would hope to be able to change the dynamics slightly on as far as increasing demand in the 1st part of the year. How much could one large pharma who really liked your products order from you each year? A lot, a lot. If you think about the company that controls the greatest planted area in Brazil, that company alone could be buying about both of its own land and for people contracted by this company, they could be buying alone about 800,000 tons per year of our product, 800,000 tons would be the number. Your ultimate target is 25,000,000 tons per annum. The current pre feasibility study has a target of 25,000,000 tons per annum. I invite everyone to watch the presentation, technology launch, where I talk about a new pre feasibility study to be developed this year, where we will be looking at the potential for addressing a much greater market share, thanks to especially thanks to Sulfa. Don't know if we'll succeed, but if we do, it would be a greater number here. How many years is it going to take for you to reach that target? I don't know. I really don't know. Will the new feasibility study mean you have to go back to square 1 with the regulators? If it's a question about the Brazilian regulators, the answer is no. If it's a question about the securities regulators, the answer is no. So I'm not sure if I understood this question correctly. I hope I addressed it. It is wonderful to hint that the NPV maybe more than $2,000,000,000 but this needs to be backed up with substance. Agree? And I think the substance is we keep growing. We keep improving as a team, as a company. We keep acknowledging our mistakes and finding ways to get better. We keep innovating when we see there is some hurdle to market development. We keep trying to communicate better with the market. We appreciate all feedbacks. At the end of every one of those calls, we always circulate a link for people to give feedbacks and I will share something here with you. The reason I will enjoy so much those calls, one of the reasons is because I learn a lot. Lots of it gets me thinking and I fully acknowledge how successful, how smart lots of our investors are, how smart lots of the people who are following the company are and how much we can learn from them, from you, who are watching on YouTube or who is with you right now. So every question you ask is an opportunity for us to improve. So please always make sure you are as blunt as you wish when you're asking questions and giving us feedback. Can you please provide an update on the 21st as to how many of the March 2021 warrants have been exercised by holders due date? It would be a material disclosure. We're not allowed to do that. So unfortunately, I cannot. Can you please address the reason for the change in orders previously appointed by the shareholders? I understand you requested the current order to step down, which they did without raising issues, provide their voluntary resignation letter, which was duly filed on SEDAR. Why did you believe this mid year change was helpful to the company to reduce costs? And the mid year is the 2nd time someone talks about the mid year. The way we see it is, it wasn't the big year. It wasn't the I understand why you're saying mid year, but it was the time the company had forever negotiated with the Oosters for the following work. What is the plan of campaign for the 2021 warrants? What your wishes are for them? Your plans on taking them up, the fact that there are only 10 investors involved in this and what they need to do to take them up. I have zero plans. I have given zero thoughts. I've been and we've been really focused on the company. I will let each one of them make up their mind on their own and we're going to carry on doing our job. Would you release the sales number for Q4 2020, so that investors have some knowledge about whether they should take up the warrants or not? I don't know. I can bring this up to the Board of Directors, discuss it internally to see if this is something that would make sense considering it would be before when we would usually file. So at this point, the answer would be no. But quite frankly, anyone who is deciding whether or not to exercise those warrants based on Q4 results perhaps shouldn't be exercising those warrants, perhaps should go and buy Nutrien or Mosaic or an established business, because I think we need to focus here really on the long term and that's the and that's how we run the company. You're advertising for a lot of new staff. What is your current staffing levels? Where are the shortfalls? And what number of employees are you aiming at? Lots of good questions here. At the moment, we have about 100 employees. The shortfall we have at the moment is mainly sales and the number of employees we are aiming at for 2021, the end of 2021 would be to have about 120 employees. Some of the ads, they are duplicated, because sometimes people apply for one position and we can really use the person that often applies for this one position doing something else. For example, some of the best people we have in our sales team, they had actually applied for a position in agronomic research. We had about 2,000 people applying for the agronomic research positions we have over the last few months. Those 3,000 people, they had to fill out a full comprehensive personality assessment, emotional intelligence, intelligence, motivations and pretty good system. And we can use the sort of personality profile we know good salespeople usually have. We can use that sort of profile to match and to scan on the people applying for research positions and then we can bring them. And we had some feedback of some of people we hired turning to us and saying, you guys believed more on what I could do than I ever knew I was capable doing. And that's not us, it's just science, it's just data analysis, just that efficient intelligence working to help us build this team. Jeff, given the bespoke blending, it sounds like you are now offering farmers with bags. Will it be feasible to stockpile or will it be just in time? We do some stockpiling, yes, because even though we talk about bespoke, the sort of product compositions for most crops, it doesn't vary that much the way we came up with the science and the way we can show chihuahuas how they get the best yields. So we can narrow the range of products or what we can show to them as being the better solution for their farms. If you want if you were to guess how many different bags, blends, so you think will be requested by the market, Verus on the Via Verus, but the study we did and by the study is also how we market when we approach what we try to sell, we are looking for this year to be selling about 10 different types of product. Isabela, just before I forget, let's put at the bottom of the YouTube video a link to the Kiss the Ground documentary. Some people might be watching the video for the first time. It's a Netflix documentary. I strongly recommend everyone to watch. And let's also post a link to the very recently issued United Nations paper on the importance of soil biodiversity to the world. I think those are 2 important documents everyone vaguely interested in what we're doing will enjoy reading about. And as Isabella just said, the link is also on our monthly newsletter, which by now I hope everyone has already subscribed to it. If you haven't yet, there is a QR code right next to me on the screen. You can point your phone to it as if you were going to take a photo and it will prompt you straight to your browser and to the link and to the website where you can register and receive our updates. John Kaisa, hope you're well, John. I hope everything is good and sound in California. And I trust you're pretty happy with your with the new Your website is a usability disaster with way too many decorative graphics and not enough information. It also serves Portuguese pop ups and blends Portuguese content with English content. What are you willing to do to make it more effective for people researching your story? I completely agree, John. The website was done thinking exclusively for Brazilian farmers. We started trying to fix it last year when we developed a new Investor Relations website. So investor. Verde. Ag is the Investor Relations website, which has financials, has all the information, filing and some other information. But what we will be doing next is working on the English version of our website. So it focused on telling investors more and giving people the real reasons why they should be investing in the company or they should be aware of the company rather than why they should personally be buying fertilizers. So this is something should be done and you should see that some point this year, hopefully sooner rather than later. Jeff, as you openly admitted in your last monthly letter, you lost repeat sales due to a less than ideal CRM system. What have you done to remedy this? We're doing it. We carried out a detailed audit on all the reasons we lost sales last year. We've compiled them all and we've been working on each one of those root causes to make sure they don't happen. And I am optimistic that this will not repeat this year. We should never expect, as I said, that a pharma will just remain a lifer in terms of buying the product just for the sake of it. I can't take that for granted. And what the system should be able to do is to allow us to monitor and follow process on this relationship to make sure we are there for the farmer when we need it and we can manage it proactively. So he places the order with us. At the moment, he usually intends to purchase an order rather than with the 1st salesperson who knocks on one's door. So that's what we are that's what we're doing. The other point, which I think is important to mention is the repurchase index for companies in the agriculture space is often small because most times they're dealing with commodities and other nutrients that they have to buy anyway. So some of it sometimes it's convenience, sometimes it's financing, sometimes it's relationship. So I don't know how much better it will be this year. What I will not accept is to lose a sale because we failed in doing something. Magnus is asking, wouldn't it be good to put out press release for things such as bags intro and EUR 2,500,000 environmental license? I think that would draw more attention to the company and make the knowledge of your products and technologies spread faster. There are a lot of people who aren't active on stock chat and or subscribe to your monthly newsletters. Good feedback, Magnus. We will definitely keep that one in mind for the next events. I agree with what you said. What will it sell for and how much will the estimated profit be per metric time? I think that question was probably together with the other questions about bags, which we addressed before. When using 1,000 tons of your feedstock to mix bags, how much does your bags weigh? What is the weight of the components you add to make bags? So farmers always look at percentage. So you're buying a fertilizer, you're looking at, for example, 3% nitrogen, 10% phosphate, 15% potash. So you're always looking at if I understood correctly, you're always looking at 1,000 tons, a percentage of on 1,000 tons. So I think I didn't understand this question. So whoever asked you could rephrase it. I think it's better than me trying to say nonsense in there myself. How was the Bax product developed? Several years talking to hundreds of farmers, discussing with several consultants, testing different engineering solutions, all done internally. So that's how it was developed, lots of tests, trial, errors, that's it. Was Bags indirect response to customer feedback or is it a Vird initiative? That's a good question. That's a very good question, very good question. It was a Vird initiative. It was a very good initiative, which came from its perception or its knowledge of how sulfur is for farmers and how much they overpay on nutrients when they buy conventional NPK blends. So by realizing that, which the vast majority of farmers just don't realize because you need to drill down into the mechanics of blending different raw materials and that's not something they need to understand or that we saw we had to do something about sulfur and then we went to look at what could be done, test different alternatives. The most cost efficient alternative, elemental sulfur, is a complex material for you to industrialize. So we had to test and it worked. We had to come up with some innovative solutions for some problems we people and we see we would have. So that's a bit of the story about it. And then, of course, once we had it figured out we parallel to having it figured out, we were in direct communication with farmers. In that direction, direct communication, we work with farmers, it we saw we were on the right path. The perception they had though wasn't an economic problem they had with sulfur. They had more a technical and efficiency problem with the source of sulfur they were using. And we managed to resolve both. So we managed to resolve something economic, more economic than what they were using, most of them are currently using and that also improves in terms of efficiency and that is why we're so excited about Bags. Do you have any comments on the recent Nobel Prize nomination? That was very exciting and a big congratulations to Alessio Paulinelli. So if there's any justice in this world, our Director, Alessio Paulinelli, should be receiving the Nobel Peace Prize this year. The man has done more than anyone living on Earth to help saving the environment, saving the planet and feeding us, feeding this population. No one has done as much as he has. If the science he came up with back in the late 60s, if all the programs he implemented back in the early 70s to develop this massive land called Serrado into agricultural land, if that work hadn't been done by him as effectively and as smart as he was able to do, we wouldn't have anywhere else in the world capable of producing as much food as it is required and in such a sustainable way without the need for deforestation as we were able to accomplish, thanks to Giulio Sanpaolo Neli. So he truly deserves that. He has already been given a World Food Prize. The gentleman who appointed him and gave him is Norman Bullock, who himself won a Nobel Prize. And in the ceremony, himself several years ago already expressed to the world how the world had to be looking at Alessio Paulinelli, not just as one should be given a world food price, but most certainly one that deserved as much as anyone else who has ever given 1 and more than several other ones a Nobel Peace Prize. One of the advantages of Verdi's current product is that it's slow release. Given that Max is a dust rather than granular, does this make runoff and leaching more likely with Bax compared to the competing products that you say of granular? George, the answer is no, because it isn't water soluble and the other products are all water soluble. And what causes really this leaching is not the runoff, it's how it infiltrates into the soil and goes deeper down in the soil to layers and depths where the roots can no longer uptake the nutrients. The other question, we need to know how much traction you're gaining with some of the larger farmers. If you take 900 farmers in total sales of, say, dollars 15,000,000 that doesn't give a huge average sale per farm. That's true, but bear in mind that some of those farmers, very large farmers, they're buying small amounts. Yesterday, we had a group, a conglomerate that can buy on its own as much as 40,000 tons of bags per year buying 75 tons of product. And the first part of your question, I think it would be a bit complicated to start sharing like percentage depending on acreage size. I think it just gets a bit complicated. We need to be a bit careful on not distracting too much our team from selling and find better ways to sell and trying to communicate every detail and every stats on what we're doing. What's the guidance for 2021 in tons and revenue? It's BRL50 1,000,000 BRL50 1,000,000 and in tons, I think that accounts for about 300,000, 350,000 tons, but it should be on the press release and in the monthly document we disclose. James is asking, are you planning on selling product in Canada? There is a growing market in marijuana production. We sell our product in Canada. The company that sells it there for us is a company called Gaia Green, owned by Vancouver Group, was founded by a very interesting gentleman who was one of the pioneers in organic cultivation and understands a lot about cannabis cultivation as well. The company his company begun apparently in one of the most favorable parts of Canada to cultivate cannabis as was found out back in the 80s around when the company began. So if you're in Canada, Gaia Green, you will be buying our product. We have 2 more questions to go. We have 31 people watching our presentation live. If anyone wants to come up with another question, now it's probably the time. So the other question is, who keeps children just came in now. Who keeps your hair so neatly cut during the COVID pandemic? My wife, she uses some handheld stuff or bombers operating. Who is going to come up with this soil analysis for each farm? Is there another potential Verdi added Certi which could be done on an annual basis? Farmers already do their soil analysis. They've already been doing soil analysis for forever. And is this another potential for the added service? No, it's a commodity. Too many companies doing it. There's no interest in doing soil analysis for France. So that completes our questions today. I thank you very much for attending this questions and answers session. If you're watching it on YouTube, please make sure you subscribe to our channel. Please make sure you share, if you liked it, with other people who may also be interested in joining our story. So thanks a lot. I hope you all have an excellent rest of your day and hope to see you soon. Bye bye.