Prime Minister Edouard Ngirente has indicated that the government has been dolling out subsidies in order to help farmers to access chemical fertilisers at a relatively low cost in the midst of rising prices.
He made the observation on Monday, April 4, while presenting government actions related to agriculture inputs to the plenary session of both Chambers of Parliament.
The Premier told legislators that fertiliser prices rose drastically on the global market because of various factors.
They include, he said, the Covid-19 pandemic effects which disrupted the supply chain such as through rising the transport cost, major fertiliser producing countries that cut exports in a bid to increase their local [agricultural] production, as well as the hike in gas tariffs used as one of the raw materials in fertiliser manufacturing.
Consequently, imported fertilisers were more expensive by the time they arrived on the local market.
In a bid to continue promoting the use of fertilisers and supporting farmers to get access to them, Ngirente said, the government has been increasing the budget for fertiliser subsidies as it more than doubled from Rwf5 billion in the fiscal year 2018-2019 to Rwf13 billion in the current fiscal year 2021-2022.
The move, he said, helped ease the cost for farmers.
For instance, he said that for NPK NPK – one of the commonly used fertilisers in the country which is made of nitrogen, phosphorus, and potassium – the government was providing Rwf107 per kilogramme for the farmer, but increased the financial support to Rwf475 a kilogramme after the fertiliser price hike, representing a fourfold increment.
"As such, a farmer only pays Rwf882 per a kilogramme of NPK instead of Rwf1,357. This shows the role of subsidies and how the government takes care of agriculture development and supporting our farmers,” he said.
According to accounts from some farmers, chemical fertiliser use significantly increases farm productivity, sometimes doubling or tripling it.
The Premier indicated that the Crop Intensification Programme (CIP) – which started in 2008 improved farmers’ understanding on the importance of chemical fertiliser use in agriculture production.
Such a situation, he said, later resulted in the increase in the [average] fertiliser use in the country, indicating that it rose to 60 kilogrammes per hectare in 2021 from 32 kilogrammes per hectare in 2017, implying an increase of 87.5 per cent over the last four years.
The average fertiliser use in Rwanda is way above that of Sub-Saharan Africa, which is 20 kilogrammes per hectare. But, it still falls short of the global level average – 140 kilogrammes of fertiliser per hectare, according to the Rwanda Agriculture and Animal Resources Development Board (RAB).
Under the first phase of the National Strategy for Transformation which runs from 2017 to 2024 (NST1), Rwanda targeted to use an average of 75 kilogrammes of fertilisers per hectare by 2024.
Ngirente observed that the current progress is promising towards the achievement of that target.
He also said that the government was in a drive to encourage farmers to use a mixture of organic and chemical fertilisers in order to optimise farm yields, and indicated that there are also some private entities that were making composted manure from organic wastes.
MP Theoneste Begumisa Safari said that the rising fertiliser prices on the international market should stir interest in the local production of this crop growth stimulant.
"Increasing fertiliser prices are a challenge to farmers. There is a need for efforts to produce it locally,” he said.
For MP Christine Mukabunani, more efforts should be invested in promoting the use of organic fertilisers among farmers.
"Some farmers are requesting a Government subsidy on organic fertiliser… Instead of putting more money in chemical fertiliser, you should invest it in scaling up the use of manure so as to gradually cut the former's use,” she said, arguing that consumers tend to prefer foods produced by using organic fertiliser instead of the chemical one.
Construction of fertiliser blending factory
Meanwhile, the Premier talked about the construction of a fertiliser blending factory which it said would help Rwanda reduce reliance on fertiliser imports, though he pointed out that it would be importing some of the raw materials to use in producing this farm input.
It was estimated that the factory, which would be located in Bugesera District, would cost $38 million (about Rwf38 billion at the current exchange rates), and the capacity to blend 100,000 tonnes of fertilisers annually, according to data from the RAB.
The project is a joint venture involving Morocco’s OCP Group – one of the leading exporters of phosphate fertilisers in the world – the Government of Rwanda and a local firm—Agro-Processing Trust Corporation (APTC).
With Rwanda’s annual demand for fertilisers at 53,000 tonnes as of 2019, as per RAB, once the factory begins production, Rwanda will have a surplus of fertilisers, potentially opening up a new avenue for export diversification.
Initially, the factory was expected to be operational by the end of 2019. However, Ngirente told legislators that its construction works were delayed by the Covid-19 pandemic.
"We hope that in the coming few years, the factory will be helping us to produce the fertilisers we need in the country,” he said, without specifying when it will be operational.