• Sunday, April 21, 2024
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BusinessDay

Nigeria’s fertiliser prices ease but out of farmers’ reach

Agroeknor distributes inputs to support female farmers

Prices of fertilisers in Nigeria have eased from their peak in 2022 but are still higher than what they were the Russian-Ukraine war broke out.

Low demand and the decline in the prices of raw materials used in the production of fertilisers are pushing down the prices of the commodity across the country.

Despite a 10 percent decline in fertiliser prices, farmers faced with the rising costs of growing food – from pesticides and herbicides to fuel and equipment – still can’t afford to buy at the current prevailing prices.

Kabiru Fara, national president of the Agro Inputs Dealers Association, said farmers have been struggling to survive since the outbreak of the COVID-19 pandemic.

He added that the persistent naira and fuel scarcity have further compounded farmers’ woes.

“Fertiliser prices have dropped by about N2,000, but still farmers are not buying and this is because they can’t afford it,” Fara said in a response to questions.

According to him, the easing cost pressure, which is supposed to encourage farmers to grow more hectares and apply more fertiliser in the ongoing dry season farming, has not helped matters owing to the persistent scarcity of fuel and naira in the country.

“The continuous naira and fuel scarcity is worsening the situation for farmers as many are even discouraged to plant as they do not own an account to receive payments for their produce,” he said.

BusinessDay market survey shows that the average price of a 50kg bag of urea has risen to N17,500 from N19,500 in December 2022, indicating a 10.3 percent increase.

While 50kg of NPK fertilisers, mostly used by smallholder farmers in the country, is being sold for an average of N27,000 as against N30,000 last year, a 10 percent drop in price.

“The prices of the raw materials for fertilisers are currently coming down globally and locally,” Gideon Negedu, executive secretary of the Fertilisers Producers Suppliers Association of Nigeria, told BusinessDay. “But the prices are still fairly higher than what they were before the Ukraine invasion but lower than last year’s peak.”

According to him, farmers’ low demand for various fertiliser blends is seriously affecting blenders in the country, and most of them have stock since last year.

Read also: National Fertiliser Company: $500m + 22 years= $66m!

Africa’s biggest economy needs diammonium phosphate, muriate of potash and granular ammonium sulphate to produce different blends of NPK fertilisers, which it does not currently produce.

According to Bloomberg, the Green Markets North American Fertilizer Index fell four percent in January to $672.82 per ton, the lowest since June 2021. The index surged to a record $1,270 per short ton after Russia’s invasion of Ukraine threw the world’s crop-nutrient sector into disarray.

Nigeria’s farmers have come under pressure since then and have continued to cut down on production to survive.

The invasion sent prices of fertilisers to the highest levels. Nigeria imports 34 percent of the raw materials for the production of NPK. However, the country is rich in urea – another blend of fertiliser.

The high fertiliser prices forced many farmers to ditch the use of the crop nutrient and switch to alternatives while others cut down on their production hectares.

“It has been very tough for farmers since last year and the situation is getting worse with the naira crunch in the country,” Abiodun Olorundenro, operation manager at Aquashoot, said.

“Lots of farmers are not cultivating in this dry season, and it is because they can’t afford the cost involved. This is why the demand for fertilisers is low and food prices keep surging,” he added.