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Fertilizer trade and pricing in Uganda

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  • Omamo, Steven Were
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    Abstract

    Liberalized fertilizer markets in eastern Africa typically deliver fertilizer to smallholder farming regions at prices that render its use unprofitable. Simultaneously, faced with little demand for fertilizer in these regions, fertilizer traders appear unwilling to invest in measures that might reduce farm-gate prices. A basic question throughout the region is therefore how to cost-effectively increase smallholders' access to fertilizer, under conditions of liberalized and privatised trade in the input. This paper explores that question for Uganda using data from a wide-ranging study of Uganda's fertilizer sub-sector. The prevailing system of fertilizer procurement and distribution is found to imply a market structure dominated by retail-level trade, high prices, and low net margins. The study concludes that there is no inherent pressures in the extant system of fertilizer procurement and distribution toward development of a wholesaling backbone that might allow capture of scale economies. But with imaginative and sustained investments in institutional innovation and strengthening, there is scope to reduce prices and increase net trading margins.

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    File URL: http://purl.umn.edu/9503
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    Bibliographic Info

    Article provided by Agricultural Economics Association of South Africa (AEASA) in its journal Agrekon.

    Volume (Year): 42 (2003)
    Issue (Month): 4 (December)
    Pages:

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    Handle: RePEc:ags:agreko:9503

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    Web page: http://www.aeasa.org.za/
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    Keywords: Agribusiness;

    References

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    1. Pender, John L. & Jagger, Pamela & Nkonya, Ephraim M. & Sserunkuuma, Dick, 2001. "Development pathways and land management in Uganda: causes and implications," EPTD discussion papers 85, International Food Policy Research Institute (IFPRI).
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    Cited by:
    1. Mujawamariya, Gaudiose & Burger, Kees & D'Haese, Marijke F.C., 2012. "Behaviour and performance of traders in the gum arabic supply chain in Senegal: Investigating oligopsonistic myths," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil 126236, International Association of Agricultural Economists.
    2. Benson, Todd & Lubega, Patrick & Bayite-Kasule, Stephen & Mogues, Tewodaj & Nyachwo, Julian, 2012. "The supply of inorganic fertilizers to smallholder farmers in Uganda: Evidence for Fertilizer Policy Development," IFPRI discussion papers 1228, International Food Policy Research Institute (IFPRI).
    3. Tomoya Matsumoto, 2013. "Disseminating New Farming Practices among Small Scale Farmers: An Experimental Intervention in Uganda," GRIPS Discussion Papers 13-18, National Graduate Institute for Policy Studies.

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