Fertilizer supply value chain in stiff focus!
By Kelvin Chisanga
(African Fertilizer and Agribusiness Partnership (AFAP) Conference Participant and Presenter)
AS we end-up day two today of AFAP Regional Public-Private Dialogue, here are some few things that I presented to the forum of experts and industry captains gathered at Radisson Blu Hotel in Lusaka, a participation which was drawn from seven African nations and the meeting has run from 7-8th December, 2022 under the tutelage support of COMESA-ACTESA.
Zambia’s total fertilizer capacity required per annum is around the region of about 850,000 metric tons and its total value is around USD 400 million which also consist of a ministry of agriculture 50% budget, this goes into FISP support program.
Currently, we have slightly over 6 million small farmers producing a total tonnage of about 2 million metric tons which will also push to about 3.7 million metric tons combined with other player scale strongly playing into the sector.
Maize is our principal cash crop which commands the larger scale intake of fertilizer at bulky measure, currently the United Capital Fertilizer is earmarked to be the biggest manufacturer of fertilizers with anticipated production capacity with potential standing at slightly about 2 million metric tons per annum.
The future project with irrigation development plans under the World Bank support is standing potentially bright for the domestic economy, where the input and output market in Zambian agriculture sector will be seen with a huge upturn owing to the projected agriculture shift being undertaken where the current policy makers are strongly pushing for farming activities throughout the all year, as the uptake for fertilizers will be extremely important in its value chain.
As the ministry of agriculture’s half of its total budget going right into the farmer input support program (FISP), the current policy system is now speaking into expanding the scheme where it is even being rebranded as Comprehensive Agriculture Support Program (CASP).
In as much as we have this social support in place to buffer food and nutrient security, we have some loopholes where the fertilizer given to the farmers on subsidized tend to sell back into the market and this causes market distortions which basically works against the market pricing structure from sources.
There is a strong need to educate small farmers into increase production tonnage, currently the small farmers produce about 2 tons per hectare instead of producing 14 tons per hectare as this has been achieved by large scale farmers and it is also noticed that the farmers in Zambia should take farming as a business as opposed to the current scenario.
It is unfortunately that the Nitrogen Chemical of Zambia has been grappling with liquidity challenges where it is estimated that it has requirements of about USD 30 million for recapitalizations, and it is also even bad to state that Zambia has not come up with fertilizer policy for this nation.