Cost of fertilizer to reduce by half as Govt announces Sh5.7bn subsidy

NAIROBI, Kenya, April 1 – The Government, through the Ministry of Agriculture, Livestock, Fisheries and Cooperatives Friday said it will release a Sh5.7 billion fertilizer subsidy which will help cut the cost of a bag by half from Sh6,000 to Sh2,800

The Cabinet Secretary Ministry of Agriculture Peter Munya, during a media briefing,  said that funds will subsidize 114,000MT (2,280,000 x 50kg bags) for farmers growing food crops.

“To ensure efficient delivery and control mechanisms are in place, the fertilizers will be available at NCPB stores countrywide effective tomorrow(Saturday). These government agencies will sell the fertilizers at agreed subsidized prices to stabilize the prices of critical fertilizers to the Kenyan farmer,” said Munya

The CS stated that under the proposed subsidized prices,  farmers will get per 50kg bag of DAP at Shs 2800, CAN at Shs 1,950, UREA at Shs 2700, NPK at Shs 3000, MOP at Shs 2500, Sulphate of Ammonia at Shs 2500.

“The government has done this to mitigate high fertilizer prices for the 2022 long and short rains as key drivers to achieving 100% food and nutrition security as enshrined in the Big Four Agenda which is high agricultural productivity,” he added.

“Agricultural inputs including fertilizers are major requirements to boost crop productivity. It is estimated that if used well, fertilizers increase food and cash crop yields by 30% thus enhancing food and income security for the country. Fertilizers replace the nutrients that crops remove from the soil and therefore without the addition of fertilizers, crop yields and agricultural productivity would be significantly reduced,” Munya said.

Munya added that the use of fertilizers in agricultural productivity is threatened following recent spikes in fertilizer prices that is Covid pandemic, restricted efforts like in countries like China, Russia and Turkey to protect their farmers compounded by heavy consumption demand from India, Brazil and USA buying up large quantities hence reducing available global supplies.

The CS said increased buying of fertilizer also led to competition for shipping thus increasing the rates for bulk and container cargo to high levels.

“Further, due to extreme winter conditions, gas prices drastically increased in Europe causing many urea and nitrate production factories to close due to competition between heating homes and producing fertilizers thus causing a shortage of these critical fertilizers.” Said the Agriculture said.

He noted Russia-Ukraine crisis caused further disruptions and concerns in the global fertilizer industry.