Government is to subsidise price of fertilizer

May 12, 2011
Accra , May 12, GNA - Government is to subsidise 150,000 metric tons (3,000,000 bags) of fertilizers at a total cost of GH¢ 69.8 million under its Subsidy Programme for the 2011 farming season.

The programme, which started in 2008, was to assist farmers increase crop productivity and production in the country.

Dr Kwame Amezah, Director of Extension Services Directorate and Coordinator of the Programme, disclosed this at a press conference to announce its commencement for the 2011 farming season.

He explained that the programme was initiated as a result of low fertilizer usage and its attendant low productivity in Ghana .

Dr Amezah said from 2008 to 2010, government had spent about GH¢ 85.1 million as subsidy on 207,215 bags of fertilizer sold to farmers by fertilizer companies within the three year period.

He said in 2011, Government was determined to ensure that the country's fertilizer application rate increased to 20 kilogrammes per hectare to be at par with the rate in Africa .

Dr Amezah said Government's policy on fertilizer programme for 2011 entailed absorbing port handling charges, agent's commission and margins to the fertilizer companies to arrive at prices that would be affordable to the small-scale farmers.

It also included absorbing the cost of transportation to ensure each type of fertilizer at the same price across the country by the fertilizer companies, opening the scheme such that all farmers and crops were included in the scheme, and using the waybill-receipt system to manage the scheme.

Dr Amezah said the way-bill system would be employed in the distribution and sale of fertilizers and fertilizer companies would be allocated quotas of various fertilizers for use by the farmers.

He said: "These companies shall import, clear the fertilizers from the ports, pay all charges and deliver allocated quantities of various types of fertilizers to designated Regions and Districts for sale to farmers by their registered sales agents.

"The recommended subsidy per 50 kilogrammes will be paid after sales, presentation and reconciliation of the relevant waybills by the companies, authenticated by the Regional and District Directors of Agriculture".

Dr Amezah said based on the agreement with the fertilizer companies, the Ministry of Food and Agriculture announced the selling prices of various types of fertilizers required by farmers, for the 2011 farming season as: Compound fertilizer (NPK) - GH¢30; Urea - GH¢29 and Sulphate of Ammonia (SOA) - GH¢25.

He said the full cost of NPK fertilizer was GH¢56 Urea - GH¢51 and SOA - GH¢40 and urged farmers to take advantage of the programme and increase productivity.

Dr Amezah advised farmers to report any dealer selling above the stipulated prices to MOFA officials in their area of operation or where they purchased the fertilizer.

He said measures were being instituted to arrest and prosecute anybody found smuggling fertilizers across Ghana 's borders.

On prompt payment to fertilizer companies, Dr Amezah said the World Bank was supporting the programme and other agriculture support programmes with 57.7 million dollars and an agreement would be signed next Wednesday, May 18 and hoped to pay the companies by the end of September.

Mr Kwesi Ahwoi, Minister of Food and Agriculture (MOFA), said it was important to keep the approach of announcing the programme to enable farmers have easy access to the fertilizers.

"It would also have been more appropriate to launch the programme on the farm to make it more practical," he said and urged the Coordinator to consider the suggestion in subsequent launch.

GNA