Marketing And Distribution Of Fertilizer In Nigeria

MARKETING AND DISTRIBUTION OF FERTILIZER IN NIGERIA

CHAPTER ONE

INTRODUCTION

1.1            BACKGROUND OF THE STUDY 

There is no doubt that inorganic fertilizers have achieved a relatively high degree of adoption among Nigeria farmers. This is shown by the increase in quantity and types of fertilizer consumed in recent years. However, the demand for fertilizers will continue to increase as the nation moves forwards achieving self sufficiency in food production.

Farmers shown interest in the use of fertilizers on their farms because of the quick and high returns from fertilizer use, especially on annual crops. This is he where farmers have access to adequate supply of fertilizers at affordable prices. But Nigeria farmers especially the small holders who constitute the bulk of farm population of this country have difficulty in getting inorganic fertilizer as a result of irregularities and policies in the marketing and distribution system.

Furthermore, it has been observed recently that Nigeria imports a lot of fertilizer besides the purchase of the locally proceed once by national fertilizer company of Nigeria (NAFCON) and federal super phosphate fertilizer companies in Rivers and Kaduna States respectively, to help in her agricultural output and development but only little result is achieved in terms of revenue and output.

The federal government has used different establishment in order to effect an efficient distribution system. The ministry of agriculture in the pre-sap period, the agricultural development programme (ADP). As at 1980’s the procurement and distribution of fertilizer was handled by individual states in Nigeria. Under this arrangement, each sate not only procure it’s fertilizer but fixed the rate of subsidy and the price at which it would be sold to farmers. The state ministry of agriculture and natural resources was charged with estimating the amount of fertilizer required during a particular period, issuing tender for supply and designing the distribution system. The contract of the private importers terminate with the delivery of fertilizer at the state warehouse. The state government handled intra-state distribution, retailing mostly through its own retail outlets and also through private sales agents who receive commission based on quantity sold.

The result was lack of uniformity in prices and distribution of fertilizers within the country, contributed immensely to the emergence of a booming black market for the product.

Hence, this study is aimed at finding out the loopholes in the marketing and distribution network. It is aimed at examining ways and better methods of getting this input to the farmers for greater productivity and output yields.

1.2            STATEMENT OF THE PROBLEM

The government has in the past introduced and pursued various policies and strategies aimed at effective procurement and distribution of fertilizer. These policies have been challenging and dynamic as the difficulties faced in actual operations.

In 1995, Ministry of Agriculture took over the procurement and distribution. The state government set up a committee to handle the distribution fertilizer. 

Problems encountered range from

1.                 Delay in delivery of fertilizer contracted for transportation to designated points in the state.

2.                 Diversion of fertilize by transporters or handlers.

3.                 Dishonesty of staff and other government functionaries who made use of middlemen to sale fertilizer at a very high rate instead of government approved rate.

4.                 Lack of stable policy by federal government

5.                 Inability for state officials to comply strictly with federal government.

6.                 Inability of fertilizer getting to the end users.

7.                 Out of stock syndrome.

1.3            OBJECTIVE OF THE STUDY

This study is aimed at achieving the following objectives.

a)                 To find out the loopholes and irregularities involved in the distribution and procurement of fertilizers.

b)                To propose policy measures that would check or curb this trend in order to enhance agricultural development in the local government, in state and the nation at large

c)                 To evaluate or measure the economic losses that result to unstable policies in terms of agricultural development in Enugu State.

1.4            SCOPE OR DELIMITATION OF THE STUDY

This study will approach the problem from a national outlook by drawing examples from different states where the problem is more pronounced. This is because it is not feasible to carry out detailed study a the grassroot level for many states.

Thus this study is narrowed down to Enugu State to allow for an empirical, concise and precise study. However, continuing the study to Enugu State and also testing one input as independent variable is a limitation. This does not matter much because the combination of fertilizer and any method of term input will yield desired result.

In other words, other inputs (variables) can be held constant while we allow variation in the variable of interest ie. Fertilizer and output.

Other limitation envisaged or expected include co-operation from the authorities to release some useful material and information and bureaucracy that normally characterize government institutions. In some cases data may not be available at all. It is also not feasible to cover many local government areas in the state.

1.5            RESEARCH QUESTION

In the study, certain questions were found to be very important, which if answered will help the researcher to now how the marketing and distribution of fertilizer affects agricultural output. Below are the questions

1.       To what extent do agricultural output depend on the fertilizer input?

2.                 To what extent do farmer get regular supply of fertilizer when needed?

3.                 To what extent do the prices of fertilizer affect the distribution?

4.                 What are other better means of distribution of fertilizers?

1.6            SIGNIFICANCE OF THE STUDY

From the discussion made earlier, it becomes pertinent that there is enough to warrant a study that will look into the policies in the marketing and distribution of fertilizers in Nigeria.

This research paper will be of immense help to persons carrying out research in related areas as it will serve as the basis for further research work a time goes on. It will also be fog rat value, to the policy makers within the agricultural sectors, and the nation at large as it will given them the opportunity to review their old policies and adopt new ones.

At the same time, it will highlight on the problems encountered by farmers in procuring of fertilizer and the need to check or curb these irregularities and malpractices.