Overall market risk: In recent times, there has been a continued decline in prices in the international market. This trend has caught the attention of importers in West Africa who are now taking advantage of the situation by increasing their demand for products. They are looking to stock up on products in anticipation of any possible future price uncertainties.
This decrease in prices is also a welcome development for African farmers who have been grappling with the issue of unaffordability. The drop in prices means that they can now resume their normal quantity-demand for fertilizers. Gradually, the issue of unaffordability, which has been a major challenge for farmers, is expected to fade away with the price decreases. Overall, the falling prices represent a unique opportunity for importers and farmers in West Africa to improve their businesses and livelihoods.
Cote d’Ivoire: The decline in international prices has continued to encourage importers to import more products to the market and store them, as there are still concerns that prices may rise in the future. The influx of newly imported products and old stocks has resulted in the availability of fertilizers in the market. However, farmers remain hesitant to increase their demand due to the lingering effects of unaffordability.
Although the prices have fallen, the full benefits of the price reduction have not been fully realized due to the presence of old stocks in the market, which has led to distortions in retail prices for the same fertilizers in the same location. Nevertheless, with the commencement of the farming season, it is expected that normalcy in fertilizer demand will soon return to the market.
In summary, while the drop in international prices has led to increased importation of fertilizers and availability in the market, the full benefits of the price reduction are yet to be fully enjoyed due to old stocks in the market. However, with the commencement of the farming season, there is hope that the market will soon normalize, and farmers will resume their usual demand for fertilizers.
Ghana: Despite the availability of fertilizers, coupled with the decrease in the international prices of fertilizers, the retail market has still not adjusted to the decreasing prices as local businesses do not want to sell off their inventories purchased at a higher price point. Although some parts in the south have started planting, demand for input is still not high as expected. Some importers are still bringing in products in the anticipation of demand improving especially in the peak of the planting season.
In Nigeria, the commencement of the rains has somewhat improved the demand of fertilizers even though it’s not at the desired scale. There are products available on the market, but the high cost of the products is still an issue, which is hindering demand. Aside from the decrease in the prices of Urea which has been reflected in the retail market, the NPK has however remained stable or slightly decreased. The retail market has not witnessed any significant decrease in prices for NPK, due to the huge volume of carryover stocks in the market which is preventing prices from reducing as being recorded in the international fertilizer market. There are discussions of a possible assistant by the government to remedy the situation for the retail market, to also reflect the decreases recorded in the international market.
In Togo, fertilizer products have begun to arrive the country in preparations for this year’s planting season. The demand for fertilizers by farmers has resumed, especially in April as the rains has started. There are products available but the official selling prices for 2023 planting season has not yet been announced.
Availability and Affordability: Despite the price fall in the international market, fertilizer prices have been consistent or decreasing slightly month after month, but they are still not affordable to farmers due to carryover stocks, except in Togo, where they have fixed pricing.
Fertilizers have been generally available in most west African countries, not because the quantity supplied has increased, but because the quantity demanded has decreased. The huge inventory carried into 2023 is still largely responsible for the slow reflection of the decreased prices in the retail market despite the reduction in prices in the international market.
Distribution: The fertilizer trade in West Africa is gradually returning to normal, even though the Russia-Ukraine war is still ongoing. Most of the fertilizer ports and borders are open for business, except for the northeast region of Nigeria, which is currently restricting fertilizer movement due to insecurity concerns.
In the case of landlocked nations like Mali and Burkina Faso, they are using the ports in Cote d’Ivoire to import fertilizers. This has helped to ensure that these countries have access to the fertilizers they need, despite being located far away from the coast.
Overall, the fertilizer trade in West Africa is recovering well, with most ports and borders operating as usual. The only exception is the northeast region of Nigeria, where fertilizer movement is currently restricted due to insecurity. Despite this, landlocked countries in the region are still able to access fertilizers through alternative means.