Nigeria has a long history of subsidies for agricultural inputs but like many government subsidy programmes, the fertiliser subsidy policy has always been subject to scrutiny over its impact, despite huge budgetary allocation.”
The federal government has registered five million farmers and their farms for fertiliser subsidy through the Presidential Fertiliser Initiative (PFI), which aims to increase the access of Nigerian farmers to NPK fertiliser, Minister of Agriculture and Rural Development, Sabo Nanono, said in Abuja on Monday.
The fertiliser industry in Nigeria possesses a blending capacity of four million tons of NPK fertiliser annually and two million tons of production for urea. Official figures say it has the capacity to employ over 250,000 people through both direct and indirect jobs across the country.
Purchasing subsidised fertiliser has been a major challenge for farmers with a lot of inefficiency and corruption plaguing the distribution system. The government hopes to get around this malaise with the database.
The PFI was flagged-off by President Muhammadu Buhari in December 2016 and is meant to improve local production of fertiliser and ensure efficient distribution to farmers at an affordable price.
The price per bag of NPK fertiliser at the gate of any PFI-accredited distributor has reportedly remained N5,500 per bag – instead of N11,000-N13,000 elsewhere – since inception until recently when it was reduced by the government to N5,000 from April, as a Covid-19 palliative.
Five million farmers have now been registered through the initiative ahead of the provision of subsidies, the agriculture minister disclosed Monday.
“Preparatory to the provision of the subsidy support, I wish to inform you that the Federal Ministry of Agriculture and Rural Development has registered and developed the database of the smallholder farmers for easy targeting with the fertilizer subsidy support,” Nanono said. “So far about five million farmers and their farms have been registered with biometrics including farm GIS coordinates.”
Nigeria has a long history of subsidies for agricultural inputs but like many government subsidy programmes, the fertiliser subsidy policy has always been subject to scrutiny over its impact, despite huge budgetary allocation.
Fertiliser use per hectare is still below the recommended amount among the farmers and access to subsidized fertiliser among small-scale farmers is also very low as the more populated farmers in rural areas are largely denied access to the input.
A 2019 study found that only a few states (less than one-third) received more than 50 percent of the fertilizer subsidy between 2001 and 2010. This is because large farmers and members of the ruling political party are often the major beneficiaries of subsidies.
The minister added that the PFI has gone through a restructuring with a new regulatory plan developed. “The regulatory framework is to regulate the activities of fertiliser operators … under which they must register and obtain a certificate of registration and sales permit respectively, before being allowed to operate in the country.”
An e-registration portal has been developed and is operational to “ease the registration process with a view to promoting transparency and accountability,” Nanono added. “All these efforts are geared towards protecting the hard-earned investments of the farmers and the fertiliser enterprises in general.”