ECOWAS summit: fertilizer subsidy removal will be gradual says Minister

Chief Audu Ogbeh

·         FEPSAN, AFAN, international agencies support removal.

The cry for fertilizer subsidy removal as posited by private stakeholders from West African countries in the agricultural sector may not be immediate especially in Nigeria as the Federal Government is determined to ensure that finance are made available to small scale farmers at a very appreciable digit number that will ensure food security in less than thirty two years so as to be able to cope with population explosion predicted by United Nation, Food and Agricultural Organization (FAO) in the African continent. 

Majority of the stakeholders including the farmers’ association are well disposed to government handling off the fertilizer subsidy to private sector based on the allegation of corruption along the procurement and distributions that have not allowed the products getting to the beneficiaries with markets and choices impediments.

Despite this stakeholders’ position, the Federal Government of Nigeria at the last month ECOWAS fertilizer summit through the Minister of Agriculture, Chief Audu Ogbeh said that farmers cannot be immediately deserted on fertilizer subsidy support but pointed that the lean budget for agriculture was also another great challenge to achieving the required quantity demanded by the African Heads of states in their resolution.

Stakeholders have described fertilizer subsidy as another conduit where billions of unaccountable naira are being drained into wrong pockets in the name of giving fertilizer subsidy to farmers through procurement and distribution by the Federal and states governments. 

The Executive Secretary to Fertilizer Producers and Suppliers Association of Nigeria (FEPSAN) Alhaji  Rabiu Kwa said that while his members out rightly supported subsidy for agricultural development so as to  reduce drudgery in farming, the aspect of subsidizing fertilizer products was not acceptable because it has limited the scope of choice and market expansion of the agro inputs to farmers.

FEPSAN boss, Alhaji Kwa pointed that government must subsidize agriculture through a well supported research work that would enhance increased yield in a small expanse of land through improved seeds varieties availability pointed that performance of fertilizer is a function of best agronomics practice which must be supported with availability of extension workers for farmers and good infrastructures of energy and road network for produce evacuation. 

“FEPSAN support agricultural subsidy for the development of the sector but we do not support fertilizer subsidy as this will not allow the development of the products in terms of market expansion that will give choice and opportunity cost for end users. Farmers must be given access to varieties and they must be made to take farming as business by using their money to purchase what will give them more profits and dividends.

 Government should rather invest on those things that will reduce farming drudgery like research, extension workers availability, supporting farmers through grants and loan guarantee at an avoidable digits, functioning infrastructures and guarantee minimum price among many others. As for us, we support subsidy support to agriculture, but not to fertilizer as this will deter the development of the sub sector” said Executive Director.

The President of All farmers’ Association of Nigeria (AFAN) Architect Mohammed kabiru posited that government should hand off from fertilizer saying incentive should be given to  companies instead of subsidy adding the past experiences have revealed it was all about corruption.

 Also the West Africa Director of International fertilizer development Centre (IFDC) Mr. Rabi Good stressed the need for the rest African countries to toll the path of Ethiopia and Ivory Coast who had faced out fertilizer subsidy adding government should not take over the role of private sector in the distribution of these agro inputs to end users.

Mr. Rabi Good pointed that as the population of Africa is anticipated to be doubled in the year 2050, there is need for consistency in agricultural policies in the region stressed also the need for access to finance fertilizer agro inputs through the commercial banks at a very appreciable digit rates. 

Stakeholders observed and frowned at the low usage of fertilizer in African at 12kg per hectare after the 2006 African submit that stipulated usage at 50kg wondering what are the structure that needed to be put in place for the purpose of achieving this target in African.

In her support to the stakeholders’ position, the International Fund for Agricultural Development (IFAD) representative Ms Atsuko Toda was worried at food importation with burden of when shall logistic to attain 50kg fertilizer usage be achieved  in the continent despite the local resources availability saying that policy implementation was a critical challenge in Africa. 

According to Ms Toda “What are we putting in place to achieve 50kg per hectare in the next 25 years despite the political will of African leaders in 2006 which was re-affirmed in 2014? What are to be put in place about what our heads of states have agreed upon? All these have to be taught out. Finance is a challenge in Africa. Cost of production in Africa is high. We have not differentiated agriculture as a business. Our economy must be encouraged beyond borders trading with each other”

Chief Audu Ogbeh however argued that the present condition of Nigerian small scale farmers was too pathetic to be left to the fertilizer open market  prices saying their lean profit cannot enable them access to sufficient purchase that would meet the stipulated amount  at the African fertilizer submit of 2014.

Already, about 50 billion naira debt inherited by the President Mohammadu Buhari from last administration are yet to be paid to fertilizer suppliers coupled fund availability challenges to ensure further supplies to farmers with no inputs distribution in 2015 till date.

FMARD Minister pointed that the dilapidated infrastructures in the country have heightened the cost of production through high transport from production destination to the  end users who are farmers saying that “We have gas that Notori is trying to convert to fertilizer but where are the facilities to move them. No railway network and this has made the cost of transportation very high. Removal of subsidy will be slowly done in Nigeria until we have ensured getting fertilizer at single digit bank loan to farmers”

The Minister lamented on the high interest rate on agriculture with commercial banks not readily disposed to lending to the sector based on the gestation period that may not attract fast interest  thereby putting farmers in a very tight corner of finance to production and processing.

 Ecowas fertilizer submit  also emphasized the need to strengthen and enhance the involvement of West African fertilizer  Association as a private entity so as to ensure standard, monitoring and involvement  in the  fertilizer policy before it would be rolled out by the member states.