Africa continues to grapple with what has been described by the UN, as the ’perfect storm of horrors’, due to the plethora of troubles that has hit the continent. From the climate change crisis, drought and famine, conflict, Covid-19 pandemic and the Russia-Ukraine war. The war has especially wreaked havoc on the continent’s food security, due to disruptions in global supply chains pertinently in food, fuel and fertilizers. Food insecurity in the continent was already at an all-time high before the war, principally in the Horn of Africa due to the locust invasion which was climate-induced. The situation was worsened by the pandemic, but the war has caused a full-blown hunger crisis in many regions. Fertilizer shortages and their high prices thereof, continue to exacerbate the hunger quagmire.
According to the 2022 Global Report of Food Crises Mid-Year Update report, at least one in five Africans goes to bed hungry, and an estimated 140 million people in Africa face acute food insecurity.
Inarguably, agriculture is a mainstay in most African economies. A key factor that has aggravated the food shortages and the hunger crisis thereof, and contributed to scaling of food prices, is the abrupt spike in fertilizer prices. The major types of fertilizers include phosphorous, nitrogen and potassium fertilizers. Russia and Ukraine are major global suppliers of fertilizers. African countries largely import theirs from the two currently warring countries. In 2019, both countries accounted for 37 per cent, 17 per cent and 14 per cent of Africa’s potassium, nitrogen and phosphorus imports respectively. The ongoing war has caused disruptions in industrial activities in Ukraine, whilst in Russia the imposed Western sanctions have disrupted supplies. In addition, most fertilizers are made from coal or natural gas, the sanctions on Russia have further increased the prices of the two resources and consequently fertilizers.
Similarly, Belarus which is a significant supplier of potash to Africa has also been under sanctions.
In June, the cost of fertilizer nearly surpassed its 2007/2008 peak, when world fertilizer prices surged by more than 200 per cent, and African farmers were the hardest hit. Earlier in May, the AfDB sounded warning that fertilizer shortages, could lead to a 20 per cent decline in food production on the continent. This reduced access to fertilizer has dealt a hard blow on food production, and has further accentuated hunger and poverty. The African Fertilizer and Agribusiness Partnership (AFAP), estimates that over 40 per cent of African soils face nutrient depletion, partly because of a failure to apply sufficient levels of fertilizers.
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For every farmer fertilizer is a basic necessity to replenish nutrient-depleted soils and improve yields. In light of this, the Abuja Declaration on Fertilizer for African Green Revolution was established as a 12-Point set of resolutions, during the 2006 Africa Fertilizer Summit in Abuja, Nigeria. Its chief objective was to improve agricultural productivity by providing financing required to boost fertilizer use in Africa to achieve the target of 50 kg of nutrients per hectare. This would in tandem improve soil fertility, and lead to achievement of food sufficiency. During the Summit, the AfDB with support from the Economic Commission for Africa and the AU Commission, established Africa Fertilizer Development Financing Mechanism (AFFM). This towards accelerating agriculture development within the context of the Africa Food Security Vision, SDGs and Agenda 2063. The African Fertilizer Development Financing Fund, was then established under the mechanism, to mobilize and pool resources. The objective of the Fund is to finance, particularly fertilizer production, distribution, procurement and use in Africa.
African countries have often adopted fertilizer subsidies’ programmes to avert massive food crises. However, these are only short-term solutions that do not address the underlying causes, of higher input costs. Furthermore, with perspective that most countries are soaking in debt, the fiscal ramifications of such schemes can prove quite dire for their economies. Inarguably, Africa needs to boost its industrial manufacturing capacity for fertilizer production.
Fertilizer manufacturing is becoming a possibility for many African countries by the day, spurred by the gaps exposed by the Russia-Ukraine war. In terms of resources, Africa has deposits of key fertilizer ingredients such as coal and natural gas, which make for the feedstock for nitrogen-based fertilizers. Coal can be found in countries like South Africa, Nigeria and Niger. The phosphate rock is also present in many African countries. Hence, Africa requires the feedstock for the fertilizer and adequate energy, for the manufacturing process as it is highly energy intensive.
With a massive market in Europe, fertilizer producers in Africa are in a rush to tap into the opportunity. According to data from the industry association of fertilizers in Europe, Russia and Belarus provide as much as 60 per cent of the EU’s fertilizer supply. The sanctions by the EU on potash imports from Belarus and Russian gas, have created a massive crisis in Europe, which is largely deficient in potash deposits. European countries are heavily reliant on imports of fertilizers, due to limited local availability of essential inputs. This includes natural gas as a feedstock and energy source, for the production of nitrogen fertilizers, phosphates and potash.
Progress of Fertilizer Production in Africa
Fertilizer production in the continent is quickly gaining momentum, especially in the wake of the Russian-Ukraine conflict. Fertilizer –producing countries have been rising up to the challenge to seal the deficit in both the continental and global market. In light of this, earlier in March, Aliko Dangote renowned as the richest man in Africa, launched the largest fertilizer plant in the continent in response to the war. The US$2.5 billion urea and ammonia fertilizer plant, which sits on sits on 1,235 acres of land, was commissioned by Nigeria’s President Muhammadu Buhari in Lagos. The plant has an annual production capacity of 3 million metric tonnes of urea, making it the second largest plant in the world, Dangote noted during the launch.
“The new plant will make Nigeria self-sufficient in fertilizer production, with excess capacity to export to other African markets, and the rest of the world. Our goal is to make fertilizer available in sufficient quantity and quality for our teeming farmers, assuring greater agricultural output.” Dangote highlighted.
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However, Morocco is renowned as the top fertilizer producer in Africa ranking in the top four global exporters, following Russia, China and Canada. The North African country boasts a large fertilizer industry, with a massive production capacity and international reach. Currently, the Kingdom seeks to seal the deficit created by the war. Given that Morocco possesses over 70 per cent of the world’s phosphate rock reserves, from which the phosphorous in fertilizers in derived, places the Kingdom on a pedestal, in terms of phosphorous fertilizer production. To boot all plants, require the phosphorous element to grow, of which there is no alternative. Being an international fertilizer exporting giant, the Kingdom’s economy has recorded massive economic growth. In 2020, fertilizer production brought the Kingdom revenues estimated at US$5.94B.
Photo-MWN
The OCP Group, is a Moroccan state-owned phosphate rock miner, phosphoric acid manufacturer and fertilizer producer established in 1921.It has built the world’s largest fertilizer production hub in Morocco. Prior to the war, the company had over 350 clients on five continents. Currently, Morocco’s production stands at 12 million tonnes, but the country aims to increase capacity by 8.2 million tonnes by 2026.
Tunisia is additionally a key player in this sector, striving to regain its position as a leading exporter in the production of phosphate minerals, as it was in 2010. A little over a decade ago the country was producing over 8.2 million tonnes of phosphate, before the Arab Spring revolution of 2011. In the first quarter of 2022, phosphate production doubled to 1.3 million tonnes, compared to a similar period in 2021. The country targets to export more than 300,000 tonnes in 2022 and 600,000 tonnes in 2023 respectively, due to increased demand as a result of the ongoing Russia-Ukraine war. Amid the daunting financial crisis, the country is experiencing, the revenues will go a long way to boost the country’s economy.
Algeria is another key player, producing an annual 3 million tonnes of urea. Earlier in March the North African country invested US$7 billion, to produce fertilizer from phosphate. The country projects to produce more than 6 million tonnes of phosphate products annually, positioning the country as a major fertilizer exporter in the world. Egypt is another critical player, producing 22.5 million tonnes of fertilizers from its eight manufacturing plants, which also includes 15 per cent of nitrogenous fertilizers at 7.8 million tonnes. This represents 8 per cent of the global production of fertilizers. The North African country is the sixth largest urea producer in the world, at 6.7 million tonnes. 60 per cent is used for domestic consumption, whilst 40 per cent is exported. Additionally, a surplus in production is estimated at around 12.5 million tonnes of fertilizers.
Furthermore, South Africa recently launched what is projected to be the world’s largest ammonia plant, estimated to cost US$4.6B. Ammonia is composed of both nitrogen and hydrogen, and is mostly used as a fertilizer. The project is to commence operations in 2026.
In Central Africa, the Democratic Republic of Congo (DRC), is also poised to become a fertilizer hub with the commencement of potash mining.
