Dynamics of the Fertilizer Value Chain in Mozambique

Abstract

Mozambique is characterized by low agricultural productivity, which is associated with low use of yield-enhancing agricultural inputs. Fertilizer application rate averaged 5.7 kg ha−1 in Mozambique during the period 2006 to 2015, considerably low by regional targets, yet constraints that affect fertilizer use have not been thoroughly investigated. This study examined the constraints on fertilizer value chains in Mozambique to contribute to fertilizer supply chain strengthening. We used a combination of multivariate analysis and descriptive methods. Our findings indicate that fertilizer use has both demand and supply constraints. Key demand-side constraints include liquidity challenges, limited awareness about the benefits of using fertilizer, and low market participation, while the main supply-side constraints include high transaction costs, limited access to finance, and lack of soil testing results and corresponding fertilizer recommendations by soil type and crop uptake. These results suggest that scaling up the input subsidy program through vouchers (either paper-based vouchers or e-vouchers) with demonstration plots and effective targeting could drive up smallholders’ demand for fertilizer and fertilizer supply by strengthening a sustainable network of wholesalers and retailers. This would likely boost agricultural productivity.

The geography of agricultural input markets in rural Tanzania

“…In their study on fertilizer usage by smallholders in Burkina Faso, Koussoubé and Nauges ( 2016 ) found that fertilizer usage was generally profitable at prevailing prices, even at low investment levels, and concluded that supply constraints via local inputs markets were likely inhibiting adoption. Zavale et al ( 2020 ) found that the growth of the fertilizer industry in Mozambique was limited by demand side factors (i.e., limited effective demand from farmers) and supply side factors (including high transactions costs). Both of these factors are known to have strong spatial expressions (Minten et al, 2013 ).…”

Nitrate Water Contamination from Industrial Activities and Complete Denitrification as a Remediation Option

“…Application of different organic and inorganic fertilizers can increase crop yields by over 50%, depending on the nutritional need of the particular plant being grown [58]. Inorganic fertilizers (NPK) with high N content were reported to increase maize (Zea mays L.) crop yields by 76.2% in the southern part of Africa, which makes them recommendable for application in other crop faming [59]. In 2017, it was estimated that 181.9 million metric tons (Mt) of fertilizer was applied in crop farming globally, and maize was recognized as the greatest consumer of fertilizer in agriculture [60].…”

“…However, up to 50% of N and 90% of P in inorganic fertilizer are not assimilated by plants and run off from the crop fields during irrigation and rain to be deposited in the nearby water bodies [67,68]. Commercial fertilizers and pesticides for crop farming contribute to most NO 3 − traced in contaminated drinking water sourced from surface and groundwater systems, which causes environmental hazards that threaten both terrestrial and aquatic life [59,69]. The Nitrogen quantity in fertilizer is estimated to increase by 172% by the year 2050, which poses the risk of further elevating NO 3 − concentrations in the environment [64].…”

Evaluating the Impacts of Smallholder Farmer’s Participation in Modern Agricultural Value Chain Tactics for Facilitating Poverty Alleviation—A Case Study of Kiwifruit Industry in Shaanxi, China

“…On the one hand, industry organizations will supply high-quality fertilizers needed by smallholders free of charge or at a price below the market price. Fertilizers with better effect, easier absorption, and environmental protection will improve crop quality and yield and improve soil quality [87,88]. Farmers will get higher per mu yield with lower input of production factors, optimize the land allocation efficiency and improve the per mu profit [89].…”