Are African Farmers Experiencing Improved Incentives to Use Fertilizer?
IDWP 156. Lenis Saweda O. Liverpool-Tasie, Thomas Jayne, Milu Muyanga, and Awa Sanou. 2017. Are African Farmers Experiencing Improved Incentives to Use Fertilizer?
Poor incentives saw fertilizer use in Sub-Saharan Africa (SSA) stagnate throughout the 1990s at roughly 10 kgs per cultivated hectare. This was partly due to the removal of crop price supports and input subsidies alongside input price hikes due to currency depreciation associated with the post-structural adjustment era. Though much has changed since the 1990s, there has been no comprehensive assessment of trends in African farmers’ incentives to use fertilizer in the last 15 years. This paper provides a comprehensive update on the incentives for fertilizer use among African farmers using data from seven countries accounting for about 65% of fertilizer consumption in SSA.
We look at the trends in nitrogen/crop price ratios for key cereals (and their fluctuations) over time, the agronomic crop response rates to applied fertilizer and some underlying drivers of fertilizer cost in SSA such as transportation. We then examine the relationship between incentives and actual fertilizer consumption. We do not find evidence of improved incentives for fertilizer use in SSA. Rather we find that nitrogen cereal crop ratios remain high and have actually increased for most cereals compared to the 1990s. There has also been an increase in the variability of these ratios, particularly for maize. Transportation and handling costs continue to contribute significantly to the higher prices that smallholders pay. We also find consistent evidence that the agronomic yield response to applied fertilizer in SSA is low on farmer fields, often lower than response rates observed by studies in the 1990s.
A more holistic approach to constraints to fertilizer profitability (costs as well as factors that will increase the efficiency of fertilizer use) is necessary for any sustainable intensification effort in SSA. This includes infrastructure or programs that reduce farmers distance from inputs and increase the agronomic response rates.