Shares in Kropz PLC (AIM:KRPZ) fell over 38% on Monday, losing 0.35p to 0.55p, after the phosphate producer announced an urgent operational review and restructuring at its Elandsfontein operation in South Africa.
Kropz said no further phosphate rock production was currently planned at Elandsfontein in South Africa.
The company, listed on London's AIM market, blamed sustained financial pressure linked to the conflict in the Middle East, which has disrupted fertiliser inputs and depressed phosphate rock prices.
Rising fuel, chemical and freight costs had also significantly affected operating costs at the Elandsfontein operation.
Elandsfontein produced 150,246 tonnes of phosphate rock in the first five months of the current financial year, with sales of 149,907 tonnes.
Kropz said future revenue from phosphate rock would come mainly from existing stockpiles, as it shifts focus to Nanophos, a slow-release soft rock fertiliser product.
Louis Loubser, chief executive of Kropz, said the restructuring would be "challenging" and expressed sadness over its impact on employees.
Phosphate rock operations could restart once market conditions normalise, subject to board approval.
Kropz said it would notify South Africa's Department of Mineral Resources and Energy as required under mining legislation.