Is Increasing Inorganic Fertilizer Use in Sub-Saharan Africa a Profitable Proposition? Evidence from Nigeria
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World Bank Group, Washington, DC
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Inorganic fertilizer use across
Sub-Saharan Africa is generally considered to be low. Yet,
this belief is predicated on the assumption that it is
profitable to use rates higher than currently observed.
However, there is little rigorous empirical evidence to
support this notion. Using a nationally representative panel
data set, and with due recognition of the role of risk and
uncertainty, this paper empirically estimates the
profitability of fertilizer use for maize production in
Nigeria. The analysis finds that inorganic fertilizer use in
Nigeria is not as low as conventional wisdom suggests. Low
marginal physical product and high transportation costs
significantly reduce the profitability of fertilizer use.
The paper finds evidence that strategies to reduce
transportation costs are likely to have a much larger effect
on the profitability of fertilizer use than fertilizer
subsidies. Apart from reduced transportation costs, other
constraints such as timely access to the product;
availability of complementary inputs such as improved seeds,
irrigation, and credit; as well as good management practices
are also necessary for sustained agricultural productivity improvements.
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AGRICULTURAL ECONOMICS, AGRICULTURAL EXTENSION, AGRICULTURAL GROWTH, AGRICULTURAL INFORMATION, AGRICULTURAL INTENSIFICATION, AGRICULTURAL MARKETS, AGRICULTURAL POLICY, AGRICULTURAL PRACTICES, AGRICULTURAL PRODUCTION, AGRICULTURAL PRODUCTIVITY, AGRICULTURAL SECTOR, AGRICULTURAL TRANSFORMATION, AGRICULTURE, AGRONOMY, AVERAGE TRAVEL TIME, BUS, CARS, CEREAL VARIETIES, CEREALS, CHEMICAL USE, CLIMATE, COFFEE, COFFEE GROWERS, COMMERCIAL FERTILIZER, COMMERCIAL SEED, COMMERCIALIZATION, CORN, COST OF TRANSPORTATION, CROP, CROP FAILURE, CROP GROWTH, CROP MANAGEMENT, CROP MANAGEMENT PRACTICES, CROP PRODUCTION, CROP YIELD, CROP YIELD RESPONSE, CROP YIELDS, CROPPING, CROPPING PATTERNS, CROPPING SYSTEMS, CROPS, CULTIVATION, DRIVING, ECOLOGICAL ZONE, ECOLOGICAL ZONES, ECONOMIES OF SCALE, FAO, FARM, FARM ACTIVITIES, FARM SIZE, FARMER, FARMERS, FARMING, FARMING SYSTEM, FARMING SYSTEMS, FARMS, FERTILISER, FERTILIZER, FERTILIZER APPLICATION, FERTILIZER DEVELOPMENT, FERTILIZER PRICES, FERTILIZER RESEARCH, FERTILIZER SUBSIDIES, FERTILIZER SUBSIDY, FERTILIZER USE, FERTILIZERS, FIELD CROPS, FOOD CRISIS, FOOD CROPS, FOOD GRAIN, FOOD POLICY, FOOD POLICY RES, FOOD PRICES, FOOD PRODUCTION, FOOD PRODUCTS, FOOD SECURITY, GEODESY, GRAIN MARKET, GRAIN QUALITY, GRAIN YIELD, GRAZING, GREEN REVOLUTION, HABITAT, HERBICIDES, HIGH TRANSPORTATION, HYBRID SEED, IFPRI, INTERCROPPING, INTERNATIONAL FERTILIZER DEVELOPMENT CENTER, INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE, LABOR DEMAND, LAND USE, LEGUMES, LEGUMINOUS CROPS, LOCAL TRANSPORTATION, MAIZE, MAIZE FARMERS, MAIZE PRODUCTION, MAIZE YIELDS, MANURE, MILLET, MIXED CROPPING, NITROGEN, NITROGEN FERTILIZATION, NUTRIENT MANAGEMENT, PESTICIDE, PESTICIDES, PLANTING, POOR FARMERS, POPULATION DENSITIES, POPULATION DENSITY, POULTRY, PRODUCE, PRODUCTION SYSTEM, PRODUCTIVITY IMPROVEMENTS, QUALITY SEED, RICE, RICE MILLS, RICE PRODUCTION, RICE YIELDS, ROAD, SEED, SEED PRODUCTION, SEED VARIETIES, SEEDS, SOIL CHARACTERISTICS, SOIL FERTILITY, SOIL QUALITY, SOILS, SORGHUM, TRANSPORT, TRANSPORT COSTS, TRANSPORTATION COST, TRANSPORTATION COSTS, TREE CROPS, TREES, TROPICAL AGRICULTURE, TRUE, UREA, VEGETABLES, WEALTH, WEED CONTROL