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East Africa and Southern Africa

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Overall market risk: As in other parts of the world, the economic deceleration in the region has led to stricter monetary policies, higher living costs, and the appreciation of the dollar against several currencies, according to the International Monetary Fund (IMF). However, the IMF’s recently released World Economic Outlook anticipates that Kenya’s growth rate will increase to 5.3% in 2023, up from the 5.1% forecast in October 2022. The IMF has revised projections for Rwanda, Uganda, Burundi and the Democratic Republic of Congo (DRC) downwards. According to the 2023 Malawi Government Annual Economic Report, the importation of pharmaceuticals, fertilizer and diesel fell in 2022 by 80%, 37% and 30%, respectively. The country is still reeling from the aftereffects of Cyclone Freddy which has worsened the outlook for both inflation and economic activity due to the serious damage caused to crops and infrastructure. 

In the agriculture sector, long rains experienced in different parts of East Africa give a positive outlook on food production. In the southern region, crop harvest is ongoing. Despite the fact that the Covid-19 pandemic and the Ukraine-Russia conflict have subsided, their consequences are still being felt, one being the high and unaffordable prices of fertilizers that are affecting many farmers. The delta between landed prices for fresh stock coming in hasn’t yet been fully reflected in the retail price points with most outlets yet to fully match the new price levels. If the favourable weather currently being experienced continues, farmer demand will continue to draw in fresh imports and eventually a lower price. 

Availability and Affordability: The second quarter has been marked by increased supply and improving uptake of fertilizers in the Eastern Africa region. No major fertilizer shortage has been reported in the region. In Kenya, most farmers are almost done with planting and top-dressing has already begun in other areas.  The national Fertilizer Subsidy that was rolled out by the government has so far released approximately 3 million 50-KG bags (150,000 Mt) to farmers of various fertilizers. The same case is in Uganda where demand for top-dressing fertilizers such as NPK 17-17-17 and CAN is rising as the rains continue. In Mozambique, the areas affected by the cyclone have registered low supply and uptake due to poor infrastructure. The availability of carryover stocks at the agrodealer level from last season is another reason for low supply by the hub dealers. In Zambia, the Ministry of Agriculture has disclosed that 1, 024, 434 farmers will benefit from the Farmer Input Support Program (FISP) during the 2023-2024 agriculture season. Contributions towards the program will remain at K400. The 2023/24 FISP tender received bids in April and is in the process of being evaluated. In Zimbabwe, fertilizer manufacturers and distributors are unwilling and unable to carry sizeable amounts of stock due to high-interest rates for borrowing and due to cash flow constraints arising from the liquidity crunch in the market. There is therefore limited stock available in the retail chains. This will affect the viability of the same and we have already started seeing some stockists and distributors closing shop. In South Africa, it is projected that there will be the odd spike in demand for urea in Q2; the overall supply-demand balance is heavily tilted towards supply. The next Indian tender is unlikely to emerge until mid-Q2 and Europe is showing signs of its seasonal demand downturn already starting. 

Distribution: The region’s ports are operating normally, with an uptick in activity that is gradually easing in the East due to the ongoing cropping season. Fertilizer vessels are already docking at Mombasa and Dar es Salaam ports this month, and more are expected in the coming weeks. In the south, there has been a decline in the importation and transit of fertilizer to neighbouring countries as the harvest season approaches. Inland and cross-border transportation is normal, but high fuel prices is a limiting factor. In areas of Malawi and Mozambique that were affected by Cyclone Freddy, the supply and distribution of commodities including fertilizers is still a major challenge due to poor infrastructure.  

West Africa

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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. 

East Africa and Southern Africa

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Overall market risk: The economies of East and Southern Africa continue to struggle to maintain and advance inclusive economic growth amidst the shocks at both the international and domestic levels. This has been worsened by elevated inflation rates, high debt distress, as well as shortages of foreign currency. 

The Kenyan economy is facing tough times with the recent implementation of increased taxes outlined in the finance bill of 2023, which was published in late April. These changes could take a toll on the economy which had already been hit hard by a regional drought and the Russia-Ukraine war that sent inflation soaring and GDP growth dipping. In Rwanda, despite the hike in inflation, IMF projects a positive outlook of GDP to grow by 6.2 percent in 2023 and 7.5 percent in 2024 respectively. In Zimbabwe, the unstable and challenging economic situation has resulted in most farmers being hesitant and unable to finance their agricultural operations.  As a result, farmers will have to depend on funding programs. Meanwhile, suppliers face obstacles in augmenting their working capital through bank loans due to exorbitant interest rates. 

Overall, in the fertilizer market space, a positive outlook looms as the prices of fertilizers are slowly coming down in the international market.  

Availability and Affordability: Most countries in the regions are registering adequate fertilizers stocks to meet the 2022/23 demand. In the southern region where the main season is about to start, suppliers and importers are seen to be positioning their products. In most parts of the eastern region, the main planting season concluded, and farmers are currently doing top-dress for their crops. According to the Fertilizer Association of Malawi (FAM), there is an adequate supply of fertilizers in the country, and the stock levels are anticipated to increase further upon the announcement of subsidy tender awards. In Ethiopia, over 500,000 metric tons of fertilizers have arrived at Djibouti port scheduled for the Ethiopian farming seasons. These fertilizers will be distributed to farmers’ cooperative unions (FCUs) and primary cooperatives (PCs) warehouses. In Mozambique, fertilizer demand is currently low as most farmers are in the harvesting season. The agrodealers on the other hand are managing with carryover stocks from the last season. In Kenya, The Kenya Tea and Development Agency (KTDA) has floated a tender for NPK 26-5-5. In South Africa, concerns are arising regarding the inventory levels in the supply chain despite the commencement of the season. About 240K Metric Tons has been imported between January and April 2023. 

Distribution: Most countries are reporting normalcy at the ports and border points. The latest report released by world bank in mid-May 2023 indicated a drop in performance of the port of Mombasa with a rank of 36 out 348 globally. This is attributed to the reduced cargo volume the port cleared in 2022, which was a drop compared to 2021. However, an improvement in cargo handling including fertilizer is expected this year owing to the completion of a second container terminal accommodating at least 450 20 FT containers at a time. In Malawi,  in-country distribution is still affected after the destruction caused by cyclone Freddy. Importers relying on the Beira port corridor face issues of unreliability and unpredictability due to the ongoing inefficiencies caused by factors such as high traffic, prioritization of vessel discharge, and tax-related problems. 

West Africa

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Overall market risk: The commencement of the rains across most countries in West Africa has ushered in the seasonal farming activities for this year. Across the region, various reports indicate Fertilizer availability in sufficient volumes. However, prices on the other hand have continued to be the bone of contention, as they are still decreasing, and in some cases increasing across the region. There are still reports of Agrodealers who still sell products at a higher price, due to the availability of old stocks. Importations are still on going for fertilizers across the region, which is mostly triggered by the attractive decreasing international prices, as most countries are using this window to stock up for the future.  

Cote d’Ivoire: With the commencement of the farming season, fertilizer suppliers have been importing and positioning their stocks to meet demand, even though demand is gradually picking up. The continuous availability of old and more expensive stocks is still creating price distortions in the retail market. With over 300,000MT of fertilizer stocks imported so far into the market for this year, it is predicted that prices would either become stable or would likely decrease, in line with the continuous decrease in the international prices. But from all indications, normalcy in fertilizer demand is gradually returning to the market. 

Ghana: Contrary to various views that the end of the flagship program Planting for Food and Jobs (PFJ) would result into a jump in the prices of inputs, prices have been relatively stable and even decreasing in some locations in the country. However, the availability of old expensive stocks was still distorting the market due to agrodealers who are not willing to bring down the prices in line with the decreases recorded in the international market. Aside from the issues associated with prices and affordability, fertilizers are available in the market for the season. 

In Nigeria, demand for fertilizers is gradually picking up due to the commencement of the rain, despite the unaffordability issues still lingering. The NPK retail market has still not witnessed any significant decrease in prices, due to the lingering volume of carryover stocks in the market which is preventing prices from reducing significantly. The prices of Urea on the other hand, have been reducing in line with the reduction from the factory. There are indications that the new government administration would intervene by introducing some policies and palliatives to ease down prices, especially for NPK’s. 

In Togo, the demand for fertilizers has improved, when compared to previous month. The government has arranged to order for 123,500MT of fertilizer which is more than enough to cover for the country’s consumption. The government has yet to set the prices for the season, but fertilizers are still available in the market.  

Availability and Affordability: Despite the continuous price fall in the international market, fertilizer prices have been stable or decreasing slightly due to carryover stocks, but they are still not as affordable as it should be, except in Togo, where they have fixed pricing. 

Fertilizers have been generally available in most west African countries, as some quantities have been imported but quantity demanded has still not significantly improved. The huge inventory carried into 2023 is still largely responsible for the slow reflection of the decreased prices in the retail market despite the falling prices recorded in the international market. 

Distribution: Fertilizer market in West Africa is gradually returning to normal, despite the Russia-Ukraine war still ongoing. All fertilizer ports and borders are open, apart from Nigeria’s northeast area, which continues to restrict fertilizer movement owing to insecurity. Landlocked nations such as Mali and Burkina Faso are using ports in Cote d’Ivoire to import fertilizer. 

East Africa and Southern Africa

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Overall market risk: Across the globe, there continues to be a significant level of inflation in domestic food prices. Based on the most recent data available for 2023, a majority of low- and middle-income countries are grappling with high levels of inflation. According to the World Bank, more than 5% inflation was observed in 70.6% of low-income countries, 81.4% of lower-middle-income countries, and 84% of upper-middle-income countries, with a considerable number experiencing inflation rates in the double digits. Nonetheless, the World Bank predicts that Kenya‘s economy will experience a slightly faster growth rate this year, primarily due to the recovery of the crucial agriculture sector. The nation’s economy is expected to expand by 5.0% in 2023, a slight increase from the 4.8% growth recorded last year. The recent improvement in rainfall across farming regions, following two years of debilitating drought, is anticipated to enhance production and alleviate inflationary pressures. In South Africa, inflation is anticipated to stabilize at around 4.5% in 2024 and beyond. In Rwanda, agriculture assessment reports have shown that the country has been affected by drought at more than 70%, and therefore, there is a greater need to mobilize farmers to cultivate all available land for season 2024A. Due to these, domestic prices for food commodities have increased significantly. 

On matters concerning fertilizer, there is an optimistic forecast in the respective fertilizer markets as international prices of N, P and K are gradually decreasing and availability from different trade routes normalising. 

Availability and Affordability: Overall, no major fertilizer shortage has been reported across East and Southern African countries, with little pockets of limited to moderate inventory reported in Malawi, Mozambique etc. In The East region where the main season has concluded, demand is low. In the southern region, importers and distributors are positioning fertilizers ahead of the season. 

As per the Fertilizer Association of Malawi (FAM), there is an approximate stock of 100,000 MT of NPK and Urea fertilizers within the country. Furthermore, there are plans for additional imports in the upcoming months, with the only hurdle being the availability of forex. In Tanzania, enough supply to meet demand has been reported. As of June 2023, about 900K MT of fertilizers was reported in the country. About 10% of this has been reported as exports. In Zimbabwe, retail outlets have reported moderate to low stocks. The primary cause for this is the reluctance and incapability of fertilizer manufacturers and distributors to maintain large inventories. This is because of elevated interest rates for borrowing and the inadequate cash flow resulting from the market’s liquidity crunch. Sable Chemicals has not been able to produce anything from the beginning of the year up to now due to liquidity constraints and severe working capital limitations. In Ethiopia, the distribution of fertilizers is ongoing smoothly with no major setbacks. 

Distribution: No major issues have been reported at the ports and border posts in most countries, but inefficiencies at the port of Beira is of concern to traders supplying product for the 2H of the year. 

In Northern Cape in South Africa, flooding has resulted in some road closures that could affect the transportation of commodities to the region. In Mozambique, Beira and Nacala ports which serve as the main ports of inland countries have continued to report inefficiencies such as delays and high taxes, especially on handling fertilizers. In Kenya, the increase in fuel prices could see a rise in transportation cost of commodities. On the other hand, KPA has reported a growth (in TEU’s) of Mombasa port as evidenced by the recent increased operations.  

West Africa

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Overall market risk: The demand for fertilizers is increasing steadily across West Africa, especially now that the decrease in prices recorded in the international market is beginning to be reflected in the local retail market. Across the region, various reports indicate fertilizer availability in sufficient volumes. There have been predictions that the prices of fertilizers would further decrease, which is likely to increase consumption levels. Importations are still ongoing across the region, triggered by decreasing international prices.  

Cote d’Ivoire: Demand has continued to pick up due to decreasing prices, and as a result fertilizer suppliers have continued to mobilize stocks and position their products to meet demand. Since the beginning of 2023, 530,000 MT have entered Côte d’Ivoire according to Customs data. Import volumes since the beginning of 2023 have already increased by 53% compared to last year 2022. Decline in prices on the international market is reflected in the local market and normalcy in the market is gradually returning. 

Ghana: While the government has assured farmers of developing a favorable and a proactive policy geared towards the agricultural sector, many farmers are still buying below the required quantity as they eagerly await further reduction in local prices., especially with various experts forecasting a further drop in the prices of Urea. However, fertilizers are available in the market at any desirable quantity. 

In Nigeria, there has been consistent increase in demand of fertilizers, as the farming season has fully commenced nationwide. This has triggered a slight increase in the prices of NPKs which are the mostlyly purchased fertilizers. Urea on the other hand has been decreasing in price in the retail market, which was attributed to the decrease in international and factory prices. Due to cost considerations, fertilizer purchases are still relatively below expectation compared to other years, but fertilizers are generally available in most parts of the country. 

In Togo, the government has made provision for some fertilizers even though reports indicate that products are available in the country. The demand for fertilizers this season is still increasing, however the government has assured stakeholders that the growing demand for fertilizer will be met. So far, it is expected that the government would have procured about 123,500MT for this planting season.  

Availability and Affordability: The fertilizer market is gradually returning to normalcy with the continuous fall in prices in the international market. So far affordability remains an issue in some countries, while some other countries are beginning to get some signs of relief, as the decrease in international prices is becoming visible in the retail market. 

Generally, across West African countries, fertilizer availability is not an issue, as most countries are still importing despite having stocks for the season. In some countries, they are yet to fully consume their carryover stocks in the market and are still importing more stocks to keep. 

Distribution: Despite the ongoing Russia-Ukraine war, fertilizer supply and distribution in West Africa is gradually normalizing. All fertilizer ports and borders are open, apart from Nigeria’s northeast area, which continues to restrict fertilizer movement owing to insecurity. Landlocked nations such as Mali and Burkina Faso are using ports in Cote d’Ivoire to import fertilizer. 

East Africa and Southern Africa

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Overall market risk:

According to the 2023 East Africa Economic Outlook by the African Development Bank, East Africa is projected to have the strongest economic performance in Africa for 2023 and 2024, with growth rates surpassing five percent. Despite this positive outlook, there are potential risks to the region’s economy, both from external factors like a global economic slowdown, rising commodity prices, and international trade policies, as well as domestic issues like the continued Russian invasion of Ukraine, tightening global financial conditions, and exchange rate depreciation. On food security, although drought conditions eased in the region, production prospects remain unfavourable in 2023. Erratic rains are impairing 2023 production prospects, following two successive years of widespread drought that had a devastating impact on food security, which is further weakened by conflicts. In Rwanda, agriculture assessment reports have shown that the country has been affected by drought at more than 70%, and therefore, there is a greater need to mobilize farmers to cultivate all available land for season 2024A. Due to these, domestic prices for food commodities have increased significantly.  In Zimbabwe, big farmers are holding on to their crops and only selling enough for working capital requirements citing that the price is not viable. The currency risk continues to be a hindrance to agriculture and productivity across all sectors. According to FAO’s Agricultural Stress Index (ASI), in several districts of Tanzania, before the start of harvesting operations, between 35 and 70 percent of cropland was affected by severe drought, with likely substantial crop production shortfalls.  

In the fertilizer sector, despite the ongoing Russia-Ukraine war, fertilizer prices have significantly dropped in recent months. This decline can be attributed to the reduced costs of raw material inputs like natural gas, urea, and ammonia. The global economy has been able to adapt to the disruptions caused by the war by seeking alternative sources for natural gas and other materials. 

Availability and Affordability: Overall, the fertilizer market faces greater risks related to fiscal factors like currency devaluation and operational challenges, rather than issues concerning availability. 

 Based on the stock report compiled by the Fertilizer Association of Malawi for July, the major suppliers in the country have around 100,000MT of NPK and Urea fertilizers available for the commercial market. This marks a slight increase from the previous month’s report, which indicated a stock of approximately 70,000MT in June. As of July, Tanzania reported that its national requirement has already been met at 148% in the period Jul 2022- Jul 2023. In Kenya, KTDA is heard to have restarted its awarding process of about 91, 000 MT of NPK 26-5-5.  In South Africa, increased demand for MOP is being observed as global prices present a stable to soft outlook in the short term. In Zimbabwe, the holding stock in retail outlets remained moderate to low. Farmers are also unable and unwilling to go in and borrow from the schemes at the revised concessionary interest rate of 75% being offered on the commercial schemes. In Mozambique, fertilizer demand is low as farmers are almost done harvesting. In Zambia, suppliers have continued to steadily buildup their stock positions for Urea, D Compound as well as other blends for the winter commercial crop and the main upcoming farming season. In Rwanda, for this 2024A season, there has been an increase in the number of fertilizer supply companies from 4 to 5. So far, 55,000 MT of fertilizers has been imported representing 55% of annual consumption. In Ethiopia, EABC continues to cover more quantities under its annual buy tender 2022/23 with about 81% covered. 

Distribution: No major issues have been reported at the ports and border posts in most countries.  In July, certain regions of Kenya experienced anti-government protests that led to disruptions in transportation. However, this did not really affect the distribution of fertilizers. The demand for logistics providers into Zambia from Beira in July has risen. The estimated time of transit of commodities out of Beira and Dar-Es-Salaam stood at an average of 5 working days in July. Ethiopia has made deliberate efforts to distribute fertilizers to the civil strife affected Northern region. 

West Africa

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Overall market risk: Despite the full commencement of the rains across West Africa, farmer demand for fertilizers remains depressed year on year (YoY) in some countries in the region. Reports indicate that there is sufficient availability of fertilizers with no shortages, but there have been delays in the supply chain. The situation has led to predictions that fertilizer prices will further decrease, potentially leading to increased consumption levels. 

However, the farming season is gradually ending in some countries, which could hinder the expected increase in consumption. As the season comes to a close, farmers may already have procured the necessary fertilizers, and new purchases might be limited. 

Importations and fertilizer supplies are still ongoing across the region, driven by decreasing international prices. Some countries have, however, put their importation plans on hold due to political issues. For instance, in Niger, political factors have influenced the decision to postpone fertilizer importations. 

As an overview, while the rains have arrived and fertilizers are available in West Africa, the demand from farmers has not shown significant growth compared to the previous year. Despite the expected decrease in fertilizer prices and ongoing importations, factors like the timing of the farming season and political issues in certain countries may impact the overall fertilizer consumption levels in the region. Continued monitoring of the situation will be important to understand how it evolves in the coming months. 

Cote d’Ivoire: Fertilizer demand has continued to increase, amidst decreasing and stabilizing international prices. As a result, fertilizer suppliers have continued to mobilize stocks to meet product demand. Import volumes since the beginning of 2023 have already increased by 53% compared to last year 2022, as over 530,000 MT have entered Côte d’Ivoire according to Customs data. As already reported, fertilizer prices show a downward trend of 17% to 30% less compared to the level of the first quarter of 2023 but remain relatively stable compared to June 2023. 

Ghana: The Ministry of Agriculture have announced their intention to replace the PFJ with a value-chain strategy. Demand in Ghana is currently low, as many markets are already preparing to transition into their off-season. From Jan – June 2023, approximately 150,000 tonnes of fertilizer were imported, with the majority being NPKs (40%) and urea (24%). Nonetheless, imports during this period remain lower than the corresponding periods in 2022. Furthermore, there has been a significant overall decrease in fertilizer prices across the country compared to the start of the year. 

In Nigeria, there have been continuous increase in demand owing to increased farming activities despite the increasing retail cost. With the availability of fertilizer raw materials, there has been continuous blending of NPK fertilizers in the country. However, there has been a reported shortage of supply of some NPK brands resulting from low production because of Urea supply shortages, which is also responsible for the rising retail Urea cost. Fertilizers are still generally available in sufficient quantities in the market.     

In Togo, the government has made provision for some fertilizers for the farming season. State-ordered fertilizer stocks are set up in all localities of the country. There is an increase in outlets this year. About twenty points of sale have been created, added to the 215 old ones. The state-guaranteed fertilizer stock is sufficient to fully cover the demand for fertilizer by farmers, which has intensified since planting began. In addition to the residual stocks of the previous season, the volume of fertilizer ordered in 2023 amounts to 123,500 tons (including 83,500 tons of NPK 15-15-15 and 40,000 tons of urea). It represents more than 100% of the annual need coverage rate estimated at 85,000 tons of fertilizer. Of the 123,500 tons, 87% are already available, or 107,500 tons of fertilizer. The rest of the order is being delivered. 

Availability and Affordability: Some sense of normalcy gradually returning in the sub-region. We are witnessing mixed outlooks in terms of consumption from country to country in comparison to 2022 season. 

Largely across West African countries, fertilizer availability is not a major issue, with some countries continually importing despite having sufficient stocks for the season. 

Distribution: Despite the ongoing Russia-Ukraine war, fertilizer supply and distribution in West Africa is gradually normalizing. All fertilizer ports and borders are open, apart from Nigeria’s northeast area, which continues to restrict fertilizer movement owing to insecurity and Niger which might likely get import sanctions due to the ongoing coup d’état. Landlocked nations such as Mali and Burkina Faso are using ports in Cote d’Ivoire to import fertilizer. 

East Africa and Southern Africa

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Overall market risk: East and Southern Africa have shown resilience in the face of economic challenges, including the Ukraine-Russia war and various external shocks. As of August 2023, the region is expected to continue its gradual recovery, with economic growth rates generally positive, albeit potentially at varying paces across different countries. Inflation rates vary across the region. Governments and central banks are implementing prudent monetary policies to keep inflation in check and maintain price stability.

On food security, according to World Food Programme, despite the improved precipitation during the March to May (MAM) season in 2023 and the projected El Niño event later in 2023, the aftermath of the 2020-2023 drought is likely to have a lasting impact. This is because it resulted in the destruction of livelihoods and left 23.4 million people in drought-affected areas facing ongoing food insecurity.

In the fertilizer space, prices have sustained their downward trend for over a year, extending into the first half of August 2023. This decline is linked to the ongoing growth in global production capacity.

Availability and Affordability:Overall, no major fertilizer shortage has been reported. The fertilizer market is exposed to risks associated with fiscal factors such as currency devaluation and operational difficulties. As the short rain season draws near in East Africa, most importers and governments are seen to be positioning different fertilizer products. In Rwanda, importing companies already have the stocks in the country although the demand and sale is still slow due to inadequate and erratic rains. According to Fertilizer Association in Malawi, fertilizer stocks have arrived at the port and its distribution for the season is now dependent on the availability of forex. In Zimbabwe, limited stocks in the retail chain in Q4 have been reported due to high interest on borrowing and due to cash flow constraints arising from the liquidity crunch in the market. In Kenya, stocks of DAP and NPK 17-17-17 with an ETA for September is being reported. At the same time, the government is rolling out the second phase of the subsidy program’s price adjustment. Agrodealers have expressed their plans to refrain from stocking fertilizer inventory during the short rainy season. This decision is primarily influenced by the decreased demand for commercially priced fertilizer compared to the subsidized product. In South Africa, demand for fertilizers is slowly picking up. A shortage of nitrogen fertilizers has been reported. Foskor and Purefert are also working to meet the demand for MAP. For Potash, a lineup of shipments is reported to have been sold out.

Distribution: No major issues have been reported at the ports and border posts in most countries. In Kenya, fuel pump prices remain high although there has not been any further escalation compared to the preceding month. Cargo handling is also set to improve at Mombasa port following the procurement of new Ship-to-Shore gantry cranes (STSs). In Tanzania, ACT Wazalendo in collaboration with the government are developing five plan strategy to improve port deal with DP world.

West Africa

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Overall market risk: Generally, across the countries in West Africa, the farming season is still on, but gradually winding up in most countries, as the raining season subsides. Fertilizers remain available but fluctuations in prices from country to country depending on the level of demand continue. There has been an unrestricted movement and supply from country to country, however, countries experiencing coup d’état have somewhat restricted the movements along their borders, in some cases, totally closed.

As earlier predicted, international prices have been stable or even decreasing in the month under review, but that hasn’t translated into decreased retail prices in some West African region, as some countries are still experiencing higher retail prices due to their own internal peculiar challenges, but on a general scale, prices have been quite stable in most countries with no reports of unavailability.

Cote d’Ivoire: Fertilizer demand has continued to increase, with the international prices being stable or even decreasing in some cases this month. Fertilizer imports have recovered strongly after a year of reduced activities. Since the beginning of 2023, 589,605 tonnes have been imported into Côte d’Ivoire (according to customs data). This volume already represents an increase of 71% compared to the previous year. As mentioned earlier, fertilizer prices are on a downward trend, with a reduction of 17% to 30% compared to the level of the first quarter of 2023, although these prices remain relatively stable compared to June 2023.

Ghana: The country is entering its minor growing season, which starts in September and extends through November. According to data from AfricaFertilizer, Ghana has imported approximately 220,000 metric tons of fertilizer between January and July 2023. In July of this year, Ghana’s food inflation reached 55.0%, slightly higher than the 54.2% recorded in June, with a month-on-month food inflation rate of 3.8%. The inauguration of the second Phase of Planting for Food and Jobs Program aims to revolutionize Ghana’s agriculture by modernizing and enhancing the agricultural sector, with a particular focus on the development of specific commodity value chains and active private sector participation.

In Nigeria, the base application period of fertilizers is gradually ending, which is reducing the quantity demanded especially for NPK’s. As previously reported, there is still a gas supply shortage to the Urea plant. The shortage has resulted in a limited supply of urea, which has seen Urea prices increase this month. Similarly, the cost of raw materials for blending has increased, thereby increasing the retail cost in the market. The high cost of local transportation further worsened this situation, thereby culminating in making prices relatively high.

Senegal: The fertilizer market in Senegal is also dynamic, as in the previous month. An increase in the demand for fertilizer from farmer-producers is noticed, resulting from the current planting period in all production areas of the country. There is an adequate supply of fertilizer from producers and major importers to meet this growing demand. Regarding the subsidy, authorized distributors are busy setting up their quotas at the level of distribution commissions, following notifications received for the distribution of subsidized fertilizers. The implementation of subsidized fertilizers started late in the distribution committees. This August, the introduction of quotas increased significantly, which helped to ensure satisfactory availability of urea, NPK 6-20-10 and NPK 15-15-15 on the market.

In Togo, the State-guaranteed fertilizer stocks are available in all areas of the country and are sufficient to fully meet the growing demand from producers since the beginning of the planting season. Combined with the remaining stocks from the previous season, the volume of fertilizer ordered in 2023 totals 123,500 tons (including 83,500 tons of NPK 15-15-15 and 40,000 tons of urea), exceeding by more than 100% the projected needs of 85,000 tons of fertilizer for the year. The price of fertilizer for the month of August remains unchanged and is similar to that of 2022 from the same period.

Availability and Affordability: Fertilizer markets have relatively returned to normalcy with prices being stable in most retail markets across West Africa, with a few exceptions. Although affordability is still a major issue in some countries, overall availability has been established with no report of any severe shortages. Consumption has increased when compared to last month across the regions, but it has still not returned to what it used to be when compared to previous years.

Distribution: The effect of the ongoing Russia-Ukraine war on fertilizers are gradually fading away with importation and distribution returning to normalcy across West Africa. All fertilizer ports and borders are open, apart from Nigeria’s northeast area, which continues to restrict fertilizer movement owing to insecurity and Niger which has gotten import sanctions due to the ongoing coup d’état. Landlocked nations such as Mali and Burkina Faso are using ports in Cote d’Ivoire to import fertilizer.