Fertiliser Association of Malawi says farmers are scrambling for fertiliser amid low supply, a situation that has pushed up prices based on demand and supply.
Data from the association shows that out of its 335 000 metric tonnes (MT) as at November 2023, 129 25MT is at the ports of Beira and Nacala in Mozambique and Dar es Salaam in Tanzania while another 106 000MT (NPK and Urea is still on the high seas to the ports and delivery to Malawi is dependent on the companies sourcing foreign exchange.
The association’s executive administration officer Hannah Makhambera said in an interview on Tuesday that the unavailability of foreign exchange has brought challenges in paying for fertiliser and this has brought challenges for the replacement of fertilisers.
She said: “Most suppliers import fertiliser using letters of credit, or on a collateral management agreement and other credit lines.
“As suppliers are putting in extra charges on interest for delayed payments; hence, an increase on the costing card.”
Makhambera said the cycle of consignment stock payment has made it difficult to complete its turnaround due to foreign exchange shortages.
As a result of this, average prices have escalated with NPK selling at K100 166 per 50 kilogramme (kg) bag, Urea is at K96166 per 50kg bag, CAN is selling at K90 250 per 50kg and Compound D is retailing at K95 000 per 50kg.
On his part, agriculture economist Steven Kayira said forex shortages and subsequent fertiliser supply hurdles in Malawi have implications at both household and economy-wide level.
He said: “Considering that smallholder farmers are the majority, reduced fertiliser access will lead to reduced crop yields and lower incomes at household level, exacerbating food insecurity, malnutrition and poverty.
“On the other hand, reduced agricultural productivity from fertiliser shortage will result in lower agricultural gross domestic product. This will be accompanied by high inflation resulting from increased production costs, in the economy.”
To sustainably mitigate the implications, Kayira said government and stakeholders need to promote alternative fertiliser sources such as manure, crop diversification methods such as crop rotation and intercropping, and soil conservation.
His counterpart, Innocent Phangaphanga Phiri, an agriculture economist, observed that one of the available alternative is timely investments in soil health amendment or improvement services.
He said this incorporates organo-mineral related fertilisers which advocate combination of some proportion of inorganic fertilisers together with organic manure that are either animal or plant-based.
“Given that our soils may already be tired or suffer from fatigue, it is high time as Malawi to start investing on organo-mineral related fertilisers or ways on how to turn the soils back,” said Phiri.
In August this year, Ministry of Agriculture said suppliers of fertiliser for this year’s Affordable Inputs Programme (AIP) will be paid in kwacha to avoid delays in implementation of the programme due to forex shortage.
Ministry of Agriculture Principal Secretary for Irrigation Services Geoffrey Mamba said this when the ministry appeared before the Parliamentary Committee on Agriculture to update it on progress of AIP implementation.
He said the government will not have to be burdened with forex issues as all contracts will be in kwacha.
Fertiliser Association of Malawi data shows that the country uses between 400 000 and 500 000MT annually, with any drop in supply having a bearing on food production. Government, on the other hand, was expecting to source 104 844.5MT of fertiliser to support beneficiaries under crop production.
