Exhibit 10.31.3

              AMENDMENT NUMBER THREE TO LOAN AND SECURITY AGREEMENT

      THIS  AMENDMENT  NUMBER  THREE  TO  LOAN  AND  SECURITY   AGREEMENT  (this
"Amendment"),  dated as of  September  24,  2004,  is entered  into by and among
PHIBRO ANIMAL HEALTH  CORPORATION,  a New York  corporation  ("Parent"),  PHIBRO
ANIMAL HEALTH U.S., INC., a Delaware corporation ("PAHUS"), PHIBRO ANIMAL HEALTH
HOLDINGS, INC., a Delaware corporation ("Holdings"),  PRINCE AGRIPRODUCTS, INC.,
a Delaware  corporation  ("Prince"),  PHIBRO-TECH,  INC.  ("PTI";  together with
Parent,  PAHUS, and Holdings,  the  "Borrowers"),  the lenders from time to time
party to the Loan and Security  Agreement  referenced below (each a "Lender" and
collectively,   the  "Lenders"),   WELLS  FARGO  FOOTHILL,  INC.,  a  California
corporation,  as the arranger and administrative agent for the Lenders ("Agent";
and together with the Lenders, collectively the "Lender Group"), in light of the
following:

                               W I T N E S S E T H

      WHEREAS,  Borrowers  and the Lender Group are parties to that certain Loan
and  Security  Agreement,  dated as of October 21, 2003 (as  amended,  restated,
supplemented,  or otherwise  modified from time to time, the "Loan  Agreement");
and

      WHEREAS,  Borrowers,  Agent,  and  Lenders  have  agreed to amend the Loan
Agreement.

      NOW,  THEREFORE,  for good and  valuable  consideration,  the  receipt and
sufficiency  of which are hereby  acknowledged,  the parties  agree to amend the
Loan Agreement as follows:

1.  DEFINITIONS.  Capitalized terms used herein and not otherwise defined herein
shall  have the  meanings  ascribed  to them in the Loan  Agreement,  as amended
hereby.

2. AMENDMENT TO LOAN AGREEMENT.

      (a) Section 1.1 of the Loan  Agreement  is hereby  amended by deleting the
definitions  of  "Additional  Indebtedness",  "EBITDA",  and  "Maximum  Revolver
Amount" and replacing them with the following definitions, respectively:

            ""Additional  Indebtedness"  means  Indebtedness  of Parent  and its
      Subsidiaries (other than Advances) that is "Permitted  Indebtedness" under
      the New Indenture because it fits only within Section 4.12(xvii) thereof."

            ""EBITDA" means, with respect to any fiscal period, consolidated net
      earnings  (or loss),  minus  extraordinary  gains,  interest  income,  and
      intercompany allocations plus interest expense, income taxes, depreciation
      and amortization for such period,  charges which are both nonrecurring and
      noncash  charges for such  period,  and charges  and  expenses  related to
      unsuccessful  acquisitions  and related  financings in an aggregate amount
      not to exceed $5,300,000 for the period

<PAGE>

      beginning  January 1, 2004 and ending  June 30,  2004,  as  determined  in
      accordance with GAAP."

            ""Maximum Revolver Amount" means up to $32,500,000."

      (b) Section 1.1 of the Loan  Agreement is hereby  amended by deleting "and
(j) Investments  comprising the PMC Sale  Transactions."  from the definition of
"Permitted Investments" and replacing it with the following:

      "(j)  Investments  comprising  the PMC Sale  Transactions,  and (k)  other
      Investments  made during the period from  January 1, 2004 through June 30,
      2004 in an aggregate amount not to exceed $336,000."

      (c) Section 7.13 of the Loan  Agreement is hereby amended by deleting "(e)
Permitted  Investments pursuant to clauses (e), (f) and (i) of the definition of
Permitted Investments" and replacing it with the following:

      "(e)  Permitted  Investments  pursuant to clauses (e), (f), (i) and (k) of
      the definition of Permitted Investments".

      (d) Section 7.18(i) of the Loan Agreement is hereby amended by deleting it
in its entirety and replacing it with the following:

            "(i) Minimum Domestic EBITDA. Fail to maintain or achieve EBITDA for
      Parent and its Domestic Subsidiaries, measured on a month-end basis, of at
      least  the  required  amount  set  forth in the  following  table  for the
      applicable period set forth opposite thereto:

            ----------------------- -------------------------------------------
               Applicable Amount             Applicable Period
            ----------------------- -------------------------------------------
                  $2,700,000              For the 2 month period
                                         ending November 30, 2003
            ----------------------- -------------------------------------------
                  $4,100,000              For the 3 month period
                                         ending December 31, 2003
            ----------------------- -------------------------------------------
                  $5,000,000              For the 4 month period
                                          ending January 31, 2004
            ----------------------- -------------------------------------------
                  $6,000,000              For the 5 month period
                                         ending February 29, 2004
            ----------------------- -------------------------------------------
                  $8,000,000              For the 6 month period
                                           ending March 31, 2004
            ----------------------- -------------------------------------------
                  $9,000,000              For the 7 month period
                                           ending April 30, 2004
            ----------------------- -------------------------------------------

<PAGE>

            ----------------------- -------------------------------------------
                  $10,000,000             For the 8 month period
                                            ending May 31, 2004
            ----------------------- -------------------------------------------
                  $12,000,000             For the 9 month period
                                           ending June 30, 2004
            ----------------------- -------------------------------------------
                  $13,200,000             For the 10 month period
                                           ending July 31, 2004
            ----------------------- -------------------------------------------
                  $14,520,000             For the 11 month period
                                          ending August 31, 2004
            ----------------------- -------------------------------------------
                  $15,972,000             For the 12 month period
                                         ending September 30, 2004
            ----------------------- -------------------------------------------
                  $16,000,000            For each 12 month period
                                         ending October 31, 2004,
                                            November 30, 2004,
                                            December 31, 2004,
                                             January 31, 2005,
                                            February 28, 2005,
                                              March 31, 2005,
                                              April 30, 2005,
                                             May 31, 2005, and
                                              June 30, 2005"
            ----------------------- -------------------------------------------

      (e) Section  7.18(ii) of the Loan  Agreement is hereby amended by deleting
it in its entirety and replacing it with the following:

            "(ii)  Consolidated  Minimum  EBITDA.  Fail to  maintain  or achieve
      EBITDA for Parent and its Subsidiaries,  measured on a month-end basis, of
      at least the  required  amount  set forth in the  following  table for the
      applicable period set forth opposite thereto:

            ----------------------- -------------------------------------------
               Applicable Amount             Applicable Period
            ----------------------- -------------------------------------------
                  $5,200,000              For the 2 month period
                                         ending November 30, 2003
            ----------------------- -------------------------------------------
                  $7,500,000              For the 3 month period
                                         ending December 31, 2003
            ----------------------- -------------------------------------------
                  $10,000,000             For the 4 month period
                                          ending January 31, 2004
            ----------------------- -------------------------------------------
                  $12,000,000             For the 5 month period
                                         ending February 29, 2004
            ----------------------- -------------------------------------------

<PAGE>

            ----------------------- -------------------------------------------
                  $15,500,000             For the 6 month period
                                           ending March 31, 2004
            ----------------------- -------------------------------------------
                  $18,000,000             For the 7 month period
                                           ending April 30, 2004
            ----------------------- -------------------------------------------
                  $21,000,000             For the 8 month period
                                            ending May 31, 2004
            ----------------------- -------------------------------------------
                  $24,000,000             For the 9 month period
                                           ending June 30, 2004
            ----------------------- -------------------------------------------
                  $26,400,000             For the 10 month period
                                           ending July 31, 2004
            ----------------------- -------------------------------------------
                  $29,040,000             For the 11 month period
                                          ending August 31, 2004
            ----------------------- -------------------------------------------
                  $31,944,000             For the 12 month period
                                         ending September 30, 2004
            ----------------------- -------------------------------------------
                  $32,000,000            For each 12 month period
                                         ending October 31, 2004,
                                            November 30, 2004,
                                            December 31, 2004,
                                             January 31, 2005,
                                            February 28, 2005,
                                              March 31, 2005,
                                              April 30, 2005,
                                             May 31, 2005, and
                                              June 30, 2005"
            ----------------------- -------------------------------------------

      (f) Section 7.18(c) of the Loan Agreement is hereby amended by deleting it
in its entirety and replacing it with the following:

            "(c)  Determination of Future Levels.  Agent shall, in its Permitted
      Discretion,  establish the monthly minimum EBITDA and capital expenditures
      covenant  levels for each  succeeding  trailing 12 month period after June
      30, 2005 based upon Borrowers'  Projections for such fiscal year delivered
      pursuant to Section 6.3(c) of this Agreement, which Borrowers' Projections
      shall be  satisfactory  to Agent in all respects.  Borrowers shall execute
      any  amendment  to this  Section  7.18  requested by Agent to document the
      inclusion of such covenant levels. If Borrowers fail to timely deliver the
      Borrowers'  Projections  pursuant to Section  6.3(c),  the minimum  EBITDA
      covenant level for each succeeding trailing 12 month period after June 30,
      2005 shall be measured on a monthly basis at an

<PAGE>

      amount equal to 100.83% of the monthly  minimum EBITDA  covenant level for
      the last trailing 12 months."

      (g) Schedule C-1 to the Loan  Agreement is hereby  deleted in its entirety
and replaced with the attached Exhibit A.

3.  CONDITIONS  PRECEDENT TO THIS  AMENDMENT.  The  satisfaction  of each of the
following shall  constitute  conditions  precedent to the  effectiveness of this
Amendment and each and every provision hereof:

      (a) Agent shall have received this Amendment, duly executed by the parties
hereto, and the same shall be in full force and effect;

      (b) Agent  shall  have  received  the  reaffirmation  and  consent of each
Guarantor,  attached  hereto as Exhibit B, duly  executed  and  delivered  by an
authorized official of such Guarantor;

      (c) Agent shall have received a schedule of the  outstanding  Indebtedness
of Parent and its Subsidiaries detailing the particular section,  subsection, or
clause of the New Indenture permitting such outstanding Indebtedness,  certified
as of the date  hereof by the  chief  financial  officer  of Parent on behalf of
Parent as being a true,  correct,  and complete  description of the same,  which
shall be in form and substance satisfactory to Agent;

      (d) Borrowers has paid to Agent, for the benefit of Lender Group, a fee in
the amount of $50,000, which fee shall be fully earned when paid;

      (e) The representations and warranties in the Loan Agreement and the other
Loan Documents  shall be true and correct in all material  respects on and as of
the date  hereof,  as though  made on such date  (except to the extent that such
representations and warranties relate solely to an earlier date), and except for
changes permitted by the Loan Documents;

      (f) No Default or Event of Default  shall have  occurred and be continuing
on the date hereof or as of the date of the effectiveness of this Amendment; and

      (g) No injunction,  writ,  restraining order, or other order of any nature
prohibiting,  directly  or  indirectly,  the  consummation  of the  transactions
contemplated  herein  shall  have  been  issued  and  remain  in  force  by  any
Governmental Authority against Borrowers, Guarantors, or the Lender Group.

4. COVENANTS. Borrowers hereby covenant and agree that they will satisfy each of
the following on or before the date  specified  below (the failure to so satisfy
any of the following to constitute an immediate Event of Default):

      (a) By December 20, 2004,  deliver to Agent a Collateral  Access Agreement
executed by the landlord for the premises  located at 65  Challenger  Boulevard,
Ridgefield  Park,  NJ and in form  and  substance  satisfactory  to Agent in its
Permitted Discretion; and

<PAGE>

      (b) By December 20, 2004, deliver to Agent an updated Schedule 5.5 to the
Loan Agreement and an updated Schedule 5.7 to the Loan Agreement, in form and
substance satisfactory to Agent.

5. EFFECTIVE DATE. The effective date of Section 2(a) of this Amendment shall be
June 30, 2004,  the effective  date of Section 2(b) of this  Amendment  shall be
January  1,  2004,  and  the  effective  date of each  other  provision  in this
Amendment shall be the date hereof.

6.  GOVERNING  LAW.  THIS  AMENDMENT  SHALL BE  GOVERNED  BY, AND  CONSTRUED  IN
ACCORDANCE  WITH, THE LAW OF THE STATE OF NEW YORK  APPLICABLE TO CONTRACTS MADE
AND TO BE PERFORMED IN THE STATE OF NEW YORK.

7. ENTIRE  AMENDMENT;  EFFECT OF AMENDMENT.  This  Amendment,  and the terms and
provisions hereof,  constitute the entire agreement among the parties pertaining
to the subject matter hereof and supersedes any and all prior or contemporaneous
amendments  relating to the subject matter hereof.  Except for the amendments to
the Loan Agreement  expressly set forth in Section 2 hereof,  the Loan Agreement
and other Loan Documents shall remain unchanged and in full force and effect. To
the extent any terms or provisions of this Amendment  conflict with those of the
Loan  Agreement  or other  Loan  Documents,  the  terms and  provisions  of this
Amendment shall control. This Amendment is a Loan Document.  Except as expressly
set forth herein,  the execution,  delivery,  and  performance of this Amendment
shall not operate as a waiver of or as an  amendment  of, any right,  power,  or
remedy of the Lender Group as in effect prior to the date hereof. The agreements
set forth  herein are  limited  to the  specifics  hereof,  shall not apply with
respect  to any  facts or  occurrences  other  than  those on which the same are
based,  shall not excuse future  non-compliance  under the Loan  Agreement,  and
shall not  operate as a consent to any further or other  matter,  under the Loan
Documents.

8. COUNTERPARTS;  TELEFACSIMILE EXECUTION. This Amendment may be executed in any
number of counterparts, all of which taken together shall constitute one and the
same  instrument  and any of the parties  hereto may execute  this  Amendment by
signing  any such  counterpart.  Delivery  of an  executed  counterpart  of this
Amendment  by  telefacsimile  shall be equally as  effective  as  delivery of an
original  executed  counterpart  of this  Amendment.  Any  party  delivering  an
executed  counterpart of this Amendment by  telefacsimile  also shall deliver an
original executed  counterpart of this Amendment,  but the failure to deliver an
original executed counterpart shall not affect the validity, enforceability, and
binding effect of this Amendment.

9. MISCELLANEOUS.

      (a) Upon the  effectiveness of this Amendment,  each reference in the Loan
Agreement to "this Agreement",  "hereunder", "herein", "hereof" or words of like
import  referring  to the  Loan  Agreement  shall  mean  and  refer  to the Loan
Agreement as amended by this Amendment.

      (b) Upon the  effectiveness of this Amendment,  each reference in the Loan
Documents to the "Loan Agreement",  "thereunder",  "therein", "thereof" or words
of like import  referring to the Loan Agreement shall mean and refer to the Loan
Agreement as amended by this Amendment.

<PAGE>

                            [Signature page follows.]

<PAGE>

      IN WITNESS WHEREOF,  the parties have caused this Amendment to be executed
and delivered as of the date first written above.

                                            PHIBRO ANIMAL HEALTH CORPORATION,
                                            a New York corporation

                                            By: /s/ Richard G. Johnson
                                               ---------------------------------
                                            Title: Chief Financial Officer

                                            PHIBRO ANIMAL HEALTH U.S., INC.,
                                            a Delaware corporation

                                            By: /s/ David C. Storbeck
                                               ---------------------------------
                                            Title: Vice President

                                            PHIBRO ANIMAL HEALTH HOLDINGS, INC.,
                                            a Delaware corporation

                                            By: /s/ David C. Storbeck
                                               ---------------------------------
                                            Title: Vice President

                                            PRINCE AGRIPRODUCTS, INC.,
                                            a Delaware corporation

                                            By: /s/ David C. Storbeck
                                               ---------------------------------
                                            Title: Vice President

                                            PHIBRO-TECH, INC.,
                                            a Delaware corporation

                                            By: /s/ David C. Storbeck
                                               ---------------------------------
                                            Title: Vice President

                                            WELLS FARGO FOOTHILL, INC.,
                                            a California  corporation,  as Agent
                                            and a Lender

                                            By: /s/ Vincent Egan
                                               ---------------------------------
                                            Title: Vice President

<PAGE>

                                  Schedule C-1
                                   Commitments

     ==========================================================================
           Lender                  Revolver Commitment    Total Commitment
     ==========================================================================
     Wells Fargo Foothill, Inc.       $32,500,000          $32,500,000
     --------------------------------------------------------------------------
     --------------------------------------------------------------------------
     --------------------------------------------------------------------------
     --------------------------------------------------------------------------
     All Lenders                      $32,500,000          $32,500,000
     ==========================================================================

<PAGE>

                                    Exhibit B

                            REAFFIRMATION AND CONSENT

      All capitalized  terms used herein but not otherwise  defined herein shall
have the  meanings  ascribed to them in that certain  AMENDMENT  NUMBER THREE TO
LOAN AND SECURITY AGREEMENT (the  "Amendment"),  dated as of September 24, 2004.
The undersigned each hereby (a) represents and warrants to the Lender Group that
the execution,  delivery,  and performance of this Reaffirmation and Consent are
within  its  corporate  powers,  have  been  duly  authorized  by all  necessary
corporate action,  and are not in contravention of any law, rule, or regulation,
or any order, judgment,  decree, writ,  injunction,  or award of any arbitrator,
court, or governmental  authority,  or of the terms of its charter or bylaws, or
of any material  contract or  undertaking to which it is a party or by which any
of its  properties  may be bound or  affected;  (b)  consents to the  execution,
delivery,  and performance of the Amendment;  (c) acknowledges and reaffirms its
obligations  owing to the Lender Group under the Loan Documents to which it is a
party;  and (d) agrees that each of the Loan Documents to which it is a party is
and shall remain in full force and effect in accordance  with the terms thereof.
Although the  undersigned  has been informed of the matters set forth herein and
has acknowledged and agreed to same, it understands that the Lender Group has no
obligations  to  inform  it of  such  matters  in  the  future  or to  seek  its
acknowledgement  or  agreement  to future  consents or  amendments,  and nothing
herein shall  create such a duty.  Delivery of an executed  counterpart  of this
Reaffirmation  and Consent by  telefacsimile  shall be equally as  effective  as
delivery of an original executed  counterpart of this Reaffirmation and Consent.
Any party delivering an executed  counterpart of this  Reaffirmation and Consent
by  telefacsimile  also shall deliver an original  executed  counterpart of this
Reaffirmation  and  Consent  but the  failure to deliver  an  original  executed
counterpart shall not affect the validity, enforceability, and binding effect of
this Reaffirmation and Consent. This Reaffirmation and Consent shall be governed
by the laws of the State of New York.

                            [Signature page follows.]

<PAGE>

      IN WITNESS WHEREOF,  the parties hereto have caused this Reaffirmation and
Consent  Agreement to be executed by their  respective  officers  thereunto duly
authorized, as of the date first above written.

                                                  PhibroChem, Inc., a New Jersey
                                                  corporation

                                                  By: /s/ David C. Storbeck
                                                     --------------------------
                                                  Name: David C. Storbeck
                                                  Title: Vice President

                                                  Western Magnesium Corp., a
                                                  California corporation

                                                  By: /s/ David C. Storbeck
                                                     --------------------------
                                                  Name:  David C. Storbeck
                                                  Title: Vice President

                                                  CP Chemicals, Inc., a New
                                                  Jersey corporation

                                                  By: /s/ David C. Storbeck
                                                     --------------------------
                                                  Name: David C. Storbeck
                                                  Title: Vice President

                                                  PHIBRO CHEMICALS, INC., a New
                                                  York corporation

                                                  By: /s/ David C. Storbeck
                                                     --------------------------
                                                  Name: David C. Storbeck
                                                  Title: Vice President

                                       S-1