Global Shocks and Agricultural Productivity: Analyzing Fertilizer and Cereal Prices in Sub-Saharan Africa

COVID-19 and the Russian-Ukraine war have been very damaging for many developing countries, rolling back many years of efforts to address poverty and food insecurity. These shocks impose immense constraints on fertilizer use and various staple value chains including rice, wheat, maize, sorghum, and millet, which are heavily consumed in many parts of Africa. In this paper, we examine the implications of these shocks on different aspects of fertilizer use and cereal consumption in sub-Saharan Africa (SSA). Relying on different datasets and employing both time-series and panel data estimators, we show that both shocks are positively correlated with increases in fertilizer and cereal prices (maize, rice, and wheat). These insights extend to the consumption of these cereal which are important staple for addressing food insecurity. We observe price increases for urea, DAP, Phosphate, and superphosphate. These price increases could explain the reduction in fertilizer consumption in the continent through their impact on accessibility and affordability. The Russian-Ukraine War seems to have a more pronounced association with the increase in fertilizer prices. We also underscore some nuanced heterogeneity based on geographical classifications: Central, East, and West Africa, suggesting the heterogeneous implication of shocks on both fertilizer and cereal prices, as well as fertilizer and cereal consumption. Generally, the COVID-19 pandemic caused more pronounced price increases for most commodities compared to the Russia-Ukraine war. The variability in impacts across different commodities shows the importance of understanding the specific supply chain and market dynamics of each commodity in response to global disruptions.