Overall market risk: Main international markets for fertilizer are in a lull. This is a positive trend for Africa since most markets are now entering or already in their respective cropping seasons, particularly for West Africa. Some West African nations are taking advantage of this slump and downward price correction to procure fertilizers from the global markets whereas as others are showing a healthy inventory from the latest data from the national level Fertilizer technical working groups (FTWG’s) by AfricaFertilizer initiative.
Cote d’Ivoire: In preparation for the crop year, major importers continue to mobilize fertilizer stocks. They are taking advantage of the drop in fertilizer prices on the international market to place orders, apprehensive that prices will rise again in the future. Importers have also diversified their source of supply since the conflicts. MOP usually sourced from Russia is now being sourced from Canada and Israel. As usual Baltic trade routes slowly re-open, normalcy in sourcing is set to return.
In Ghana, while awaiting clearance for the appointment of the new Agric Minister designate, the food and agriculture ministry (MoFA) is actively pushing for the implementation of the 2023 Planting for Food and Jobs program. According to data from the Ghana Fertilizer Technical Working Group (FTWG), the country’s fertilizer imports in 2022 increased by 103% year on year. The market is likely to be sitting on a higher carryover stock level and with the fresh imports coming in, availability might not be an issue but more of affordability going into the 2023 cropping season.
In Nigeria, the issue of cash shortages in the country is making business transactions between the farmers and agrodealers difficult, thereby decreasing demand and sales. It is expected that demand will start increasing as we approach the rainy season but if the cash situation does not improve, it will cause a lot of issues. High cost of transportation resulting from the scarcity and high cost of fuel is still affecting the fertilizer market in some parts of the country. The Federal Government is planning to introduce fertilizer subsidy to farmers in the country. This would be done through a programme financed by the African Development Bank and International Fund for Agricultural Development.
In Togo, the state is in the process of scoping suppliers for farmer’s demand for the 2023-2024 crop year. The options being considered are the Moroccan and Nigerian giants.
Availability and Affordability: Fertilizer prices have been consistent or decreasing slightly month after month, but they are still not affordable to farmers, except in Togo, where they have fixed pricing.
Fertilizers have been generally available in the countries we monitor, not because the quantity supplied has increased, but because the quantity demanded has decreased. Despite the reduction in prices in the international market, this is yet to be reflected in the local price points as retail prices are still largely unaffordable to the farmers because of prior stocks purchased at high price levels.
Distribution: Notwithstanding the ongoing Russia-Ukraine war, trade of fertilizers in West Africa is gradually returning to normal. Fertilizer ports and borders are open, with the exception of Nigeria’s northeast area, which continues to restrict fertilizer movement owing to insecurity. Landlocked nations such as Mali and Burkina Faso are also using ports in Cote d’Ivoire to import fertilizer.