Fertilizer FX ban: Sacrifice towards self sufficiency

Onome Amuge

The production of food for consumption is an indispensable activity necessary for the sustenance of human life. Food production and consumption also play a vital role in the actualisation of economic stability of a nation.

With the global population currently growing at an average rate of 1.05 per cent per year, as estimated by Worldometer, an international real-time statistics website, it is important that enough crops are produced annually to meet the food, clothing and other agricultural products needs of the rising global population.

To ensure food security and sustainability today, managing soils to produce food and maintain its fertility level tantamount to upscaling its nutrients. To this effect, the application of fertilisers to the soil has proved effective in not only ensuring the supply of nutrients to the soil but also, boosting agricultural productivity. With the aid of fertilizers, plants have become more resilient against pests, weeds and harmful pathogens. The ‘appropriate’ use of fertilizers has on a global scale effectively increased agricultural yields and improved productivity.

As a result, various governments across the world have made improved access to and utilisation of fertilizer a top priority in the implementation of agriculture development strategies. Nigeria, unarguably Africa’s most populous nation and highest consumer of agricultural produce is not left out in the ‘fertilizer scramble’, albeit on a challenging terrain. According to a 2016 survey report by the Federal Ministry of Agriculture and Rural Development, nitrogen deficiency is severe in more than 80 per cent of the farmlands in the country, more than 75 per cent of the land was also reported to have a serious phosphorus deficiency while more than 60 per cent of the land suffered potassium deficiency.

The survey report postulated Nigeria’s low fertilizer usage and the need to bolster chemical and organic fertilizer consumption. Some of the challenges the report noted include; lack of technical knowledge in the proper application of fertilizers by farmers, substantial risks in predicting the timing and amount of fertilizer demand in a given season, inability to afford fertilizer prices, low production by local fertilizer producers compared to demand rate, leading to a surge in importation of fertilizers.

To address these constraints and expand access to fertilizer, the President Muhammadu Buhari administration established a partnership between the Fertilizer Producers and Suppliers Association of Nigeria (FEPSAN) and OCP Group, a Moroccan based fertilizer producing company established the Presidential Fertilizer Initiative (PFI) which flagged off in 2017. The key aim of the initiative is to make high quality fertilizer available to Nigerian farmers promptly and at an affordable price and also, to revive the ailing fertilizer blending industry to ensure the country achieves food security.

The PFI is managed by the Nigerian Sovereign Investment Authority (NSIA) and analysts have affirmed that the business model of operation involves sourcing for and procurement of four constituent raw materials (Urea 36%, Limestone 27%, Phosphate 21% and Potash 16%) required for the local production of NPK fertilizer. According to the federal government, the programme has revived operations in a total of 33 blending plants resulting in an increase in domestic production capacity by nearly 300%. The government leveraged on this development to impose a forex restriction on the importation of fertilizers in Q4 of 2018.

Africaferterlizers.org in Nigeria Fertilizers Statistics overview noted that the fertilization importation restriction saw a decrease in the volume of imported fertilizer from 804,093 metric tonnes in 2017 to 131,458 metric tonnes in 2019. President Buhari further restated the forex restriction order to the CBN in September 2020. Local fertilizers blenders were also urged to convey their products directly to state governments to enable them skip the cartel of transporters undermining the efforts to successfully deliver the products to users at reasonable costs.

However, the import ban served as bad news for some farmers and agriculture stakeholders who expressed their displeasure. Simon Irtwang, president, National Association of Yam Farmers Processors and Marketers (NAYFPM), lamented that the availability and acquisition of the NPK fertilizer and other brands still remain a huge problem for farmers in the country and the ban is too early as local production is not yet enough to meet the demands of farmers.

Toyin Ijawoye, an agriculturist is also not in support of the government’s directive, warning that if necessary steps were not taken to address some of the challenges with the fertilizer availability, farmers may experience the worst with the ban. Wale Oyekoya, former chairman, Agriculture and Allied Group of Lagos Chamber of Commerce and Industry (LCCI) noted that feedback from farmers showed that NPK fertilizers were purchased above the 5,000 naira price stipulated by the government.

Michael Abahi, a farmer opined that the government should have allowed fertilizer to be saturated in the market and more affordable before making the policy because the fertilizer supply chain is still marred by many challenges. On the other hand, Thomas Etuh, president of the Fertilizer Producers and Suppliers Association of Nigeria commended Buhari for re-emphasising the need to sustain the ban placed on the importation of fertilizer. He stressed that the presidential pronouncement was a demonstration of the government’s determination to ensure self-sufficiency in food production.

Speaking in the same vein, Suleiman Haruna, an agriculture analyst stated that Nigeria has more than enough to blend any NPK fertilizer and the importation of the finished product will affect the growth of the local industry. He further stressed that the ban is a good opportunity to attract local investments.

Agriculture development expert, Adewale Ajadi thinks the government’s import ban directive is a reasonable and beneficial decision because it is in line with what the government has intended to do for a while which is to diversify the economy. According to him, local fertilizer is cheaper though they may be of a different quality in comparison to the imported fertilizers, but it is critical for Nigeria to develop its capacity in terms of providing local fertilizers that supports our local yield.