Overall market risk: In West Africa, farmers in various countries are gearing up for the farming season as the onset of rain marks the beginning of agricultural activities. While fertilizer demand is expected to pick up as the season progresses, there has been a slight improvement in demand so far. Overall, there has been relative stability in fertilizer prices across the region, with some countries even experiencing a decrease in costs. However, Nigeria stands out with continuous price increases attributed to the local devaluation of the national currency. As of now, there are no reports of fertilizer scarcity in any West African countries. On the contrary, continuous fertilizer supplies and stocking are being reported, leading to a slight decrease in product costs in some areas. Moreover, there is smooth movement and supply of fertilizers across borders within the West African region.
Benin: In March 2024, Benin witnessed significant changes in the sale conditions of NPK 13-17-17 and NPK 14-18-18 fertilizers initiated by the cotton company, the primary mineral fertilizer supplier. These changes include limiting fertilizer allocation for food crops, requiring detailed farmer information for purchase validation, and a substantial 61% price increase for NPK 13-17-17 and NPK 14-18-18, now priced at $37 per 50 kg bag. This rise in prices has raised concerns among farmers regarding restricted access to fertilizers. Despite rising fertilizer demand due to the rainy season and agricultural preparations, these measures could potentially dampen demand, impacting crop yields and agricultural productivity, especially in central and southern regions. Although there is sufficient urea supply, the NPK stock covers only 37.5% of the expected quantity needed for the season, estimated at 120,000 tonnes for cotton and food crops. Additionally, limited availability of SSP fertilizer in shops reflects farmers’ unfamiliarity with its application.
Cote d’Ivoire: The Ivorian fertilizer market remains strong, supported by continuous supply from major importers, with about 80,000 tons of fertilizer imported by March 2024. Declining international prices are gradually affecting local prices, potentially restoring them to pre-Covid-19 levels and boosting demand for the 2024 crop year. Importers are preparing by increasing inventories and considering re-export opportunities to Burkina Faso and Mali to manage credit risks. Prices have been stable from February to March, with notable decreases compared to January. Additionally, the cotton sector secured 146,400 tons of fertilizer for the 2024 season, slightly lower than the previous year, with current prices at $28 for urea and $30 for NPK, pending adjustments for the upcoming season.
Ghana: The World Bank recently issued a procurement tender for Ghana’s Ministry of Food and Agriculture (MoFA), aiming to purchase 27,876.65 metric tons of NPKs and 9,528.85 metric tons of urea. In March 2024, fertilizer prices saw a slight increase compared to the previous month. Ghana secured a shipment of 14,000 metric tons of European 15-15-15 fertilizer, soon to be loaded onto the port, while another vessel carrying blended 23-10-5 fertilizer has departed Europe and is expected to arrive in the second week of April. MoFA has initiated farmer registration for the Planting for Food and Jobs phase two (PFJ 2.0) program, targeting over 2 million farmers this year.
Liberia: As the main farming season approaches, land preparation is nearing completion nationwide, with 10-20% of seeds already planted. Despite farmers acknowledging the importance of fertilizers, sales remain low due to high costs, despite minor price reductions for TJAL fertilizers. This disparity is attributed to varying pricing strategies among agro-dealers. Many farmers refrain from purchasing fertilizers due to cost and reliance on donor assistance, leading to stagnant prices. Agro-dealers face increased market risks while awaiting government subsidies to ease prices. The gap between farmer demand and agro-dealer sales persists, prompting expectations of government intervention to reduce prices. Despite this, agro-dealers maintain sufficient fertilizer stocks to meet demand. Presently, subsidies are only provided to agro-dealers during port clearance, resulting in high prices for farmers.
Nigeria: Nigeria’s annual inflation rate is set to rise from 31.70% in February to 32.63% in March, driven by concerns over escalating fertilizer prices. With ex-factory prices undergoing further revisions, retail prices are on the ascent, likely impacting fertilizer consumption, particularly during the wet season farming period in the Southern and North-central regions. Despite recent reports of the naira strengthening against the dollar, persistently high raw material costs and the dollar-to-naira exchange rate pose ongoing challenges. These factors contribute to the continued increase in retail prices of fertilizer products, compounded by transportation costs. Nevertheless, there’s optimism regarding the availability of fertilizer raw materials for the upcoming farming season. The country’s primary importers plan to import additional vessels of key raw materials, aiming to bolster NPK production and supplement existing carryover stock into 2024.
Senegal: As of March 2024, Senegal’s fertilizer market remains stable, with a diverse range of fertilizers available across different regions. Government subsidies have led to a decrease in fertilizer prices, improving accessibility to both subsidized and non-subsidized fertilizers and enhancing agricultural productivity and food security. Analysis of fertilizer prices in various cities reveals significant diversity in both varieties and costs. For example, Urea prices range from 12,500 to 30,000 CFA francs for 50 kg bags, while NPK formulations vary from 13,000 to 45,000 CFA francs for 25 kg or 50 kg bags. Price fluctuations on the open market show a 13% decrease in NPK 15-15-15 and a 9% increase in NPK 15-10-10. Urea experienced a notable 19% decline, with other formulations showing moderate variations, reflecting market trends and the availability of subsidized fertilizers. The availability of diverse fertilizers in each city underscores specific agricultural needs, demonstrating a dynamic relationship between supply and demand across production areas.
Sierra Leone: Fertilizer sales in March 2024 have significantly dropped compared to the previous month, as reported by major importers like Seedtech, TJal, and Jamal Enterprises. Despite this, Mangara Agribusiness made a substantial Urea sale to Sunbird Bioenergy in Northern Sierra Leone, which utilizes Urea for various agricultural purposes. March in Sierra Leone typically witnesses high temperatures, leading to reduced farming activities and lower fertilizer demand, expected to persist until early April. Consequently, fertilizer prices are anticipated to remain stable or slightly decrease in certain regions due to the subdued demand from farmers.
Togo: In March 2024, there is an abundant supply of fertilizers in Togo, with 30,179 tons of subsidized fertilizers available across the country. Out of 230 designated stores, 225 have been stocked with approximately 22,000 tons, including 9,000 tons of urea and 13,000 tons of NPK 15-15-15. The remaining 5 stores in the northern region await supplies due to the delayed onset of the rainy season. Additionally, 8,179 tons of fertilizers, comprising 6,657 tons of urea and 1,522 tons of NPK 15-15-15, are stored in Lomé warehouses. Despite this surplus, the current demand remains low, with only 73 tons of fertilizer sold in March. Looking ahead to the 2024-2025 agricultural season, a total of 33,952 tons of fertilizer has been mobilized, including 29,202 tons of urea and 4,750 tons of NPK 15-15-15. Notably, the government holds 27,000 tons of urea, while private companies possess 6,952 tons, including 2,202 tons of urea and 4,750 tons of NPK 15-15-15. Prices for fertilizer for food crops, including urea and NPK 15-15-15, remain subsidized and unchanged, priced at $30 (or 18,000 FCFA) per 50 kg bag. Similarly, cotton-specific fertilizers like NPK 12-20-18 +5S +1B, including urea, remain stable at $23 (or 14,000 FCFA) per 50 kg bag. New subsidized prices are anticipated at the beginning of the 2024-2025 crop year.
Availability and Affordability: In West Africa, fertilizer markets demonstrate diverse pricing trends at retail levels in the month of March. Currency devaluation, notably in Nigeria, has resulted in significant price increases, especially for newly imported products. Conversely, regions with existing stock observe relatively stable or decreasing prices. While certain countries face affordability challenges, overall availability remains consistent, with no significant reports of shortages. This mixed pricing pattern is expected to continue in the coming year.
Distribution: Fertilizer distribution in West Africa is gradually returning to normalcy, signaling a positive shift as the effects of the Russia-Ukraine conflict diminish. Most fertilizer ports and border crossings are now operational, indicating improved conditions across the region. Despite ongoing security challenges in Nigeria’s northeastern region, there is optimism with the removal of various sanctions in Niger by ECOWAS. Landlocked nations like Mali and Burkina Faso have demonstrated resilience by leveraging ports in Cote d’Ivoire for fertilizer imports, ensuring a consistent supply chain. This adaptability underscores the agricultural sector’s capacity to navigate obstacles effectively. Overall, the stabilization of distribution channels in the region is promising for agricultural resilience and sustainable growth. While localized challenges persist, projections indicate stability and continuity in the essential fertilizer supply chain across West Africa.