Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from the line of Don Carson - UBS
Don Carson - UBS
First a housekeeping question, and then a question on phosphates, on the cash flow statement you outlined $38.6 million in derivatives gains, yet in your discussion on the segments you talked about a 4.6 gain in phosphate and 1.6 loss in potash, just wondering what that difference is. And then I just wanted you to expand on your comment that on slide nine, where you want to extend your phosphate reserves. Is this because you think it will be too difficult and expensive to add capacity in Florida and I know you’ve talked in the past about accessing some reserves in South America. With the impending [Biobar] start-up, would that rock be suitable for Mosaic and do you think that that can help lower merchant rock prices.
Jim Prokopanko
With those two questions, I’m going to ask Larry Stranghoener to address the first question and I’ll follow-up with some comments about the permitting ore reserves or phosphate.
Larry Stranghoener
The answer lies in the difference between unrealized and realized gains. We noted the unrealized gains and losses in the press release. The realized gains we just include as part of cost of goods sold and I think its best just to handle the details on that offline after the call.
Jim Prokopanko
To your question on what our intentions are and thinking is looking abroad for phosphate rock reserves, we presently purchase about one million tonnes of phosphate ore from other parties, mostly Morocco. And we mine and process about 17 million tonnes in a normal year, so about 5% roughly is purchased.
One we’d like to find some alternatives to that if we could and so we are looking just to diversify our holdings of ore in other geographies in the world. Second, why not pursue extending our mining in Florida, at present we have about 30 to 35 years of proven and probable ore reserves, something like approximately six or seven years depending on operating rates of permitted reserves ahead of us.
And we just think having a balanced approach with some alternative supplies outside of the Florida geography is an appropriate thing to do and we think there’s some cost effective alternatives to continue in Florida.
We’re going to continue in Florida. This will just help extend the life of our total rock reserve. Does that answer that?
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