Investment In Fertilizer Hits $4.5bn

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As the government is striving to make agriculture the mainstay of the Nigerian economy, fertilizer which is a critical input in agriculture has attracted an investment worth $4.5 billion.

This investment was majorly  done by Notore and Indoramma, who have been the major players in the fertiliser subsector in the recent past. It was also learnt that Dangote fertiliser will commence production by the end of next year which will also be a major boost in the industry.

Addressing journalists at the end of the end of a fertiliser summit organised by the African fertilizer and Agribusiness partnership (AFAD), a consultant of AFAD, Scott Wallace said about 10 recommendations was made at the end of the summit, which will help drive the fertiliser industry.

fertilizer-bagsHe said one of their recommendations was to ensure the quality of fertilizers that circulate in the market for farmers to buy. He said some fertilizers bears 50kg on the sack but the content sometimes is less than 50kg.

Part of their recommendations according to Wallace was to ensure easy transportation of Urea across the country having in mind the current ban of Urea movement without clarification from National Security Adviser (NSA).

He said they have set up technical experts to meet with the Nigerian government to chart possible ways to control the movement of Urea and making fertiliser available in the market on time for farmers.

Meanwhile, a fertiliser expert from the  African fertilizer and Agribusiness partnership (AFAD), Paul Makepeace has said that  Nigeria loses an equivalent of  about 30 million tonnes worth of urea; the critical component of fertiliser  due to gas flaring activities.

He disclosed this  along the sidellines of the Nigeria Fertiliser Roadmap Stakeholders Consultation meeting held in Abuja.

According to him: “98% of the world urea is made from natural gas. The amount of gas flared is the raw material you need to make urea. In Nigeria where there is a lot of flaring and the gas not been collected over along long time, there is the equivalent of 30 million tonnes of urea flared every year”.

He explained that if the gas flared  can be captured  and cleaned , it then becomes  available for the manufacturers of  fertilisers  which in turn would drastically cut down production cost and   encourage increased usage  by farmers and  encourage export.

“One of the advantages of urea,is that its a safe product to transport and Nigeria has an advantage in terms of proximity to Latin america, Brazil in particular which has a 10million tonnes of urea import every year”, he said

Makepeace  expressed optimism that with the coming on stream by Dangote into fertiliser production of 2. 8 million tonnes capacity  next year , indorama’s move  to double its 1.4 million tonnes  capacity in the next couple of years as well as Nicora’s efforts ,  Nigeria would hit at an export capacity of 3.5 million tonnes. “  at 200 dollars per tonne, that becomes a significant amount of foreign exchange for nigeria, he added.

Also speaking, the Vice president AFAD, Prof Richard Mkandawiru said in spite of Nigeria’s huge potential in consuming fertiliser, its uptake  was still very low compared to other countries .

“The use of fertiliser in Africa and Nigeria is extremely low per hectare compared  to other countries. For example in India, they use  200kg  per hectare and Nigeria uses about 10 to 12kg per hectare

“Clearly without the increased use and usage of fertiliser, we cannot enhance agricultural productivity without the use of fertiliser So the commitment is to see how can ensure the increase flow of fertiliser and the increase usage of fertiliser by small holder farmers and the appropriate  fertilisers per hectare because there are a lot of adulterated fertilisers by Unscrupulous dealers.”, he argued

High grade fertilisers  ready to be distributed to farmers.
High grade fertilisers ready to be distributed to farmers.

He  said it has led high cost of fertiliser, lack of efficiency in distribution ,challenges of infrastructure and the inefficient  transport network to remote areas in the country  thereby contributing  to making fertiliser very expensive .

According to him, one sure way of ensuring the availability accessibility and affordability of the product is to provide  concessionary credit to agro farmers

“It is therefore critical that as we look at our subsidy,part of it should go towards financing agro dealers so they can buy fertilisers at a relatively reduced cost and pass the reduced cost to the small holder farmers.

Also speaking, the Minister of Agriculture ad Rural Development who was represented by the Director Farm support Services, Engr Jatto Ohiare said the  programme  is critical in addressing the challenges of the fertiliser industry in Nigeria .

He  stressed the need to get the process of distribution and access of fertilisers to farmers at the  right time and at the right cost.

“Government is still very much interested in giving subsidy to farmers, there no going back about that. We can only talk about how do we administer the subsidy and for now, government is using the GES platform. But for now, GES may not be the best, but there is no better alternative for now. So we cannot talk about leaving subsidy until we have an alternative window which will substitute of for the farmers”,  he disclosed