Govt increases fertiliser subsidies amid global price shocks

The government of Rwanda said it will increase subsidies on selected fertilisers for the 2027A planting season to mitigate the impact of a sharp rise in global input prices. The Minister of Agriculture and Animal Resources, Telesphore Ndabamenye, said this on Thursday, July 2, during the launch of the Ministerial Guidelines for the distribution of subsidised agricultural inputs for the planiting season that runs from July to December. ALSO READ: Fertiliser subsidy hits Rwf64bn as Middle-East turmoil spikes prices Ndabamenye said the government increased the subsidy on urea from 30 per cent to 45 per cent after international prices climbed by about 60 per cent, largely due to supply chain disruptions and higher transport costs. We increased the subsidy so that the price paid by farmers does not rise by more than 20 per cent despite the sharp increase on the international market, he said. The subsidy programme is expected to benefit about two million farmers registered under the Smart Nkunganire System. The minister urged farmers to register early to facilitate timely planning and distribution of agricultural inputs before planting begins. Under the new pricing structure, urea is subsidised at 45 per cent, DAP at 46 per cent and NPK at 43 per cent, while other fertiliser blends attract subsidies ranging between 18 and 46 per cent depending on their formulation. ALSO READ: Subsidised insurance for greenhouse farms launched Under the revised subsidy rates, urea will retail at Rwf1,980 per kilogram with the government contributing Rwf890, representing a 45 per cent subsidy. DAP will retail at Rwf1,950, with a government contribution of Rwf890. Meanwhile, NPK 17:17:17 (Tweze) will cost Rwf1,861 per kilogram, with the government covering Rwf 807. Other subsidised fertilisers include Kynoplus, Twihaze, Ongera, Amidas, Cereal Powergrow, Winner, Otesha and Microp formulations. Depending on the product, government subsidies range from 18 to 46 per cent, with farmers paying between Rwf755 and Rwf1,215 per kilogram. The minister said the differentiated subsidies reflect changes in global prices rather than a blanket adjustment across all fertilisers. He attributed higher import costs to global logistical challenges and geopolitical tensions, including the conflict in the Middle East, which disrupted supply chains and pushed up freight charges. The contribution of transport costs and the global market determines the prices we are seeing today, while the growth of local production is beginning to play an important role, he said. ALSO READ: Rwf75bn in agric subsidies: This is how much farmers will pay Ndabamenye said Rwanda currently uses between 90,000 and 100,000 tonnes of mineral fertilisers each year. For the 2027A season alone, the country plans to supply about 60,000 tonnes, including 25,000 tonnes that will be manufactured locally. The long-term objective, he said, is for locally produced fertilisers to account for at least half of the country's total fertiliser consumption beging in 2027. The planting season will also see the distribution of four locally blended fertiliser varieties produced by Rwanda Fertilizer Company. The products were developed following nationwide soil mapping and research conducted by the Rwanda Agriculture and Animal Resources Development Board (RAB) and its partners to match fertiliser formulations with the nutrient requirements of different farming zones. The customised blends are currently designed for crops including potatoes, beans and rice, with plans to increase the number of locally tailored fertiliser formulations to nine in the coming years. The new guidelines expand the number of approved fertiliser distribution companies from four to six compared to the previous season, while 26 companies have been certified as seed multipliers to supply improved seeds under the subsidy programme. The government continues to subsidise mineral fertilisers for maize, beans, wheat, soybeans, rice, potatoes, cassava, bananas, vegetables and fruit trees. “Hybrid maize seeds also remain subsidised, as local seed multiplication has helped to keep prices relatively stable,” according to Ndabamenye. Suppliers cite global disruptions Suppliers said preparations for the planting season are already well underway, with about 60 per cent of the required fertiliser stock already in the country to minimise delays associated with international shipping. Susan Asiimwe, Legal Counsel at One Acre Fund Tubura, said early registration enables distributors to determine farmers' input requirements and ensure fertilisers reach them on time. She said global market disruptions, particularly those linked to the Middle East conflict, significantly affected fertiliser imports over the past months. There was scarcity of products such as urea, and suppliers had to work together to secure a vessel because very few ships were coming to East Africa. Bringing in a vessel under those circumstances became much more expensive, which contributed to the increase in fertiliser prices, she said.

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Govt increases fertiliser subsidies amid global price shocks