Presidential Fertilizer Initiative — Boosting Food Security and Agricultural Production in Nigeria

Before the oil boom in the early ’70s, agriculture had been the mainstay of the economy, and contributed the most to the nation’s GDP. Nigeria was largely an agrarian State that farmed for income and for personal consumption and was ranked top among countries exporting cash crops. Nigeria exported agricultural produce to countries like Britain, USA, Canada and Germany. It however took backstage to oil and petroleum products in the ’70s when oil prices were at its highest and the nation was making money through the sale of oil per barrel. The export rate of the agricultural sector over the years has reduced to the barest minimum and the country has been subjected to importing goods and produces that can be locally produced.

Fertilizer is an important necessity for effective farming and bountiful harvest. The fertilizers though necessary are quite expensive and unaffordable for farmers who would want to go into commercial farming. Nitrogen Phosphorus and Potassium (NPK) fertilizer is a complex fertilizer comprised primarily of the three primary nutrients required for healthy plant growth. The agriculture industry relies heavily on the use of NPK fertilizer to meet global food supply and ensure healthy crops. According to the International Fertilizer Development Center (IFDC), about half of the global population is alive as a result of the increased food production provided by the use of mineral fertilizers. As much as this fertilizer is necessary, it is however not affordable for small scale sustenance farmers as it was largely imported from Europe.

To ease this bottleneck, the Presidential Fertilizer Initiative was birthed. In February 2017, the presidency flagged off the Presidential Fertilizer Initiative (PFI) as approved by President Muhammadu Buhari in December 2016, to achieve the local production of one million metric tonnes of blended NPK Fertilizer for the 2017 wet season farming and an additional 500,000 metric tonnes for dry season farming. This move was on the heels of the visit of the King of Morocco, His Royal Majesty Mohammed VI, during a 2-day State visit to Nigeria in 2016.

The objective of this initiative is to ‘disrupt’ the importation of blended fertilizer status-quo, by directly negotiating discounted contracts to procure the 4 constituent raw materials for NPK Fertilizer; locally-sourced urea (36%), locally-sourced limestone granules (27%), diammonium phosphate (21%) imported from Morocco, and Muriate of Potash 16% (MOP) sourced from Europe and blending these locally to produce NPK Fertilizer at reduced cost. Prior to December 2016, Nigeria’s stock of blended fertilizer was shipped into the country as fully-finished products, even though Urea and Limestone, which constitute roughly two-thirds of the component of each bag, are available in the country. The PFI is specifically fashioned to cut costs of fertilizer production and stop importation of materials that can be sourced locally.

The PFI is concerned with the production of multi-nutrient fertilizer and make it available and affordable for farmers. Once the fertilizer is produced and packaged, the finished products are delivered to Nigerian farmers at a starting price of about N5,500 per bag, compared to the N8,000 — N9,000 cost of imported fertilizer. This initiative would be beneficial to both the farmers and the economy as through the production of NPK fertilizer using locally sourced materials, employment would be created for the unemployed quota through the revamping of the moribund fertilizer plants, and reviving the local blending fertilizer industry. This initiative would also enhance food security as a result of the expected increase in food production. As a result of this, the food-induced inflation and stimulation of economic activities across the agriculture value chain while creating thousands of direct and indirect jobs.

By the PFI, fertilizer would be available to Nigerian farmers at a reduced price which would result in a projected savings of US$200 million in foreign exchange and about N60 billion in budgetary provisions for fertilizer subsidy. Beyond the broader goal of ensuring food security for the country by providing high-grade fertilizer to enhance harvests, the Buhari administration is by this initiative, reinforcing its commitment to reviving and diversifying the economy, and creating growth, through focus on agriculture.

The Nigeria Sovereign Investment Authority (NSIA) established a Special Purpose Vehicle, known as NAIC-NPK Limited to manage the fertilizer fund on behalf of Fertilizer Producers and Suppliers Association of Nigeria (FEPSAN). To ensure seamless distribution of fertilizers at an approved rate of N5,500, President Muhammadu Buhari approved the payment of the outstanding N22bn for dealers of agricultural inputs, popularly known as agro-dealers immediately the programme kicked off.

After one year of PFI, import of finished fertilizer had reduced drastically. To date, the programme has contributed to the resuscitation of 14 moribund blending plants, which represents 55 per cent of total installed capacity in Nigeria. Also, more than six million bags of 50kg NPK 20:10:10 fertilizer has been produced locally. These have been distributed to farmers under the programme.

According to the Executive Secretary of the Fertilizer Producers and Suppliers Association of Nigeria (FEPSAN), Ahmed Rabiu Kwa, the Presidential Fertilizer Initiative activities have brought dramatic changes in agriculture and particularly the fertilizer industry in the country. He added that Nigeria will become a major exporter of fertilizer going by the success rate of PFI, as the programmme is one of the best in Nigeria over the years. FEPSAN has registered over 200 Fertilizer Distributors in the country, spread across the geo-political zones.

With this initiative in place, Nigeria would be able to regain its stand as one of the largest exporters of agricultural produce both in Africa and the world. Already, the fertilizer has saved the country and suppliers a huge amount of money as the cost of importing already produced fertilizer has been cut down to only importing materials that cannot be locally sourced in Nigeria.

It has been observed that Nigeria will be in good position to export large quantity of fertilizer within the next two years if current gains of the Presidential Fertilizer Initiative are sustained. The country is currently selling important agro input to some of Nigeria’s neighbors like Benin Republic, Chad, Cameroon and Niger Republic, a development which will help restore the country’s position as the food basket of the West African sub-region.