Implementing positive strategies for effective use of fertilizer in developing countries

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2 Implementing positive strategies for effective use of fertilizer in developing countries Dr Asseta Diallo Program Officer, Agribusiness (Fertilizer Supply and Policy) AGRA (Alliance for a Green Revolution in Africa)

3 Problem statement Fertilizer consumption increasing in Africa Challenges for African small holder farmers to access fertilizer AGRA s contribution to grow fertilizer supply and use in Africa improving and increasing fertilizer supply supporting demand creation facilitating access to finance supporting policy initiatives Lessons learnt Way forward

4 Smallholders dominate Africa s agriculture : around 69 million households The yields of their crops is unfortunately too low to feed Africa that is now spending over US$ 35 billion annually to import food soils present inherent difficulties for agriculture : nutrient mining by crops, leaching, and inadequate erosion control Heads of African States recognized during the Abuja summit in 2006 that fertilizer is crucial and have engaged to increase the use to 50kg per ha by 2015 Fertilizers are key for Africa s agriculture transformation

5 Fertilizer consumption increasing in Africa Organization logo to Source: FAO, Current world fertilizer trends and outlook to 2016, Rome 2012

6 Fertilizer consumption increasing in Africa Organization logo to Source: FAO statistics (FAOStat, 2012)

7 Affordability : Fertilizers cost are high Availability : many issues at supply side Physical accessibility : the distribution network doesn t cover all areas of smallholder farmers Financial accessibility : many small holder farmers don t have financial capability to buy fertilizers Limited awareness on fertilizers advantages Poor quality fertilizers

8 Fertilizers are expensive in Africa: high cost of finance, transportation and distribution Organization logo to Domestic supply-chain cost components, average for Ghana, Nigeria, Mali, Senegal in 2009 (Average cost per metric ton (US$)) Source: IFPRI Policy Brief 20, March 2012

9 Objective : Increase farmers financial and physical access to locally appropriate soil nutrients and fertilizers Our approach : investing both in public and private sector 4 key areas : (i) supply side, (ii) demand creation at smallholder farmer level, (iii) facilitating access to finance and (iv) enabling policy environment

10 Supporting the African Fertilizer and Agribusiness Partnership (AFAP) Increasing storage facilities in Mozambique, Ghana and Tanzania; Some fertilizer plants supported to increase their capacity of production of blended fertilizer (Mali, Mozambique and Tanzania) Over 600,000 Mt of fertilizers moved through APCs Number of companies increased from 2009 to date

11 Agro-dealers network strengthened and extended Organization logo to In Burkina Faso, agro-dealers association growth : from 337 members to 757 over 3 years Year 2 Year1 Year 3

12 Distribution network is essential : about 25,000 agro-dealers supported, which reduced the distance a farmer has to travel to purchase quality fertilizer and/or seed. Travelling distance reduced by an average of 10 km where investments done (Burkina Faso, Mali, Rwanda, Ghana) Development of hub dealers to purchase and supply big quantities of fertilizers : initiatives going on with AFAP Hub-agrodealer facility at DodomaTanzania, 6000 MT

13 between fertilizer plant and hub dealers : In Mozambique, in the Central Region between the blenders/granulators and Hub Agro Dealers, reduction of price from $41.03 to $33.50 for 50 kg bag of NPK and from $35.90 to $ kg of Urea between hub dealers and agro-dealers

14 Case in Mozambique : Mozambican Association for Promotion of Fertilizer Use (AMOFERT), with membership from the Ministry of Agriculture, fertilizer suppliers and Agrodealers, NGOs, donors, and farmer associations Sharing information, identification of issues but more importantly strategies

15 ISFM implemented in 13 countries: more than 4 million smallholder farmers aware of ISFM and about 1,5 million using ISFM Implementing demo plots through Agro-dealers projects in all 13 countries : thousands of demos for cereals and vegetables

16 Average maize yield for 3 years in response to ISFM across countries Source : AGRA database, 2014

17 Closing yield gaps: about 3000 farmers in northern Nigeria more than doubled their yields, about 60% realizing maize yields between 4 to 7 MT per ha. The ability to secure inputs (improved seeds and fertilizers) and remunerative output markets was key

18 Microdosing technology in West Africa, an innovative approach Adoption studies in Burkina Faso and Niger: Yields increased : sorghum 54%, Millet 38% Economic efficiency B/C ratio : 7, 4 and 6 for sorghum, Millet and cow-pea respectively in Burkina Faso Appears to be gender neutral

19 AFAP investment : matching grant and credit guarantee Total credit guarantee of about $ 6 M and the total value of the credit around $ 29 M About $ 1,4 M of matching grant to support APCs Credit guarantee for agro-dealers with commercial banks in many countries : Burkina Faso, Kenya, Mali, Niger, Uganda and Rwanda; $ 1,3 M of credit granted to 300 agro-dealers in Burkina, Mali and Rwanda

20 13 countries supported : facilitating elaboration of regulations for fertilizer quality control and their implementation, making functional laboratories, strengthening human resources capacities (2801 fertilizers inspectors and 229 laboratory (lab) technicians trained), creating awareness among stakeholders Supporting harmonization initiatives at regional level In west Africa the awareness creation at national level In East Africa : facilitating the process with the East African Community

21 Increased investments in infrastructures, capacity building, financing mechanism Supplying appropriate fertilizer blends for different crops and soils, and packaging them in packages that meet farmer s needs is key Facilitating networking of the fertilizer value chain stakeholders within and across countries is essential for sharing information and influencing in ways that grow the fertilizer Growing the agro-dealers network to have them closer to smallholder farmers to improve the availability and access and reduce transaction cost

22 Demand creation requires: Awareness creation of smallholder farmers let them see and measure the impact themselves Conducting large numbers of demonstrations on farms and in strategic locations in rural areas. And the demonstrations must use improved seeds so that the investments made in fertilizers payoff. Cashless could be a mechanism facilitating the demand from smallholder farmers Investment from both public and private sectors; the fertilizer industry can contribute a lot to this process

23 Enabling policy environment Supporting the development of national policies are necessary to improve fertilizer business and ensure that quality standards are achieved. Financing Innovative finance for stakeholders in the fertilizer value chain contributes to improve the distribution channel and increase the supply and use of fertilizers.

24 Work more with the public sector to: Improve infrastructure at ports and inland roads for the distribution system Re-design their input subsidy programs in ways that make it more efficient and delivers to the target farmers Implement the fertilizer regulatory system for quality fertilizers and return in investment for smallholder farmers Support and strengthen the private sector to develop: Fertilizer plants for blended fertilizer Hub-dealers and agro-dealers to facilitate physical access Facilitate dialogue between public and private sector

25 What next? Organization logo to Let s all help grow fertilizer use and usage by Africa s smallholder farmers, to at least 50 kg of nutrients per ha. We can do it. Thank you