Revisiting the demand and profitability of chemical fertilizers amid global fuel-food-fertilizer crisis: Evidence from Ethiopia

Revisiting the demand and profitability of chemical fertilizers amid global fuel-food-fertilizer crisis: Evidence from Ethiopia

Author: Assefa, Thomas

Publisher: Intl Food Policy Res Inst

Published: 2024-07-16

Total Pages: 40

ISBN-13:

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We revisit the state of smallholder fertilizer demand and profitability in Ethiopia in the face of the recent global fuel–food–fertilizer price crisis triggered by the Russian–Ukraine war and compounded by other domestic supply shocks. We first examine farmers’ response to changes in both fertilizer and food prices by estimating price elasticity of demand. We then revisit the profitability of fertilizer by computing average value–cost ratios (AVCRs) associated with fertilizer application before and after these crises. We use three-round detailed longitudinal household survey data, covering both pre-crisis (2016 and 2019) and post-crisis (2023) production periods, focusing on three main staple crops in Ethiopia (maize, teff, and wheat). Our analysis shows that fertilizer adoption, use, and yield levels were increasing until the recent crises, but these trends seem halted by these crises. We also find relatively large fertilizer price elasticity of demand estimates, ranging between 0.4 and 1.1, which vary across crops and are substantially larger than previous estimates. We find suggestive evidence that households with smaller farm sizes are relatively more responsive to changes in fertilizer prices. We also document that farmers’ response to increases in staple crop prices is not as strong as perceived and hence appears to be statistically insignificant. Finally, we show important dynamics in the profitability of chemical fertilizer. While the AVCRs show profitable trends for most crops, the share of farmers with profitable AVCRs declined following the fertilizer price surge. Our findings offer important insights for policy focusing on mitigating the adverse effects of fertilizer price shocks.


Mismatch between soil nutrient requirements and fertilizer applications: Implications for yield responses in Ethiopia

Mismatch between soil nutrient requirements and fertilizer applications: Implications for yield responses in Ethiopia

Author: Abay, Kibrom A.

Publisher: Intl Food Policy Res Inst

Published: 2021-06-28

Total Pages: 41

ISBN-13:

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Lack of accurate information about soil nutrient requirements coupled with limited access to appropriate fertilizers could lead to mismatch between soil nutrient requirements and fertilizer applications. Such anomalies and mismatches are likely to have important implications for agricultural productivity. In this paper we use experimental (spectral soil analysis) data from Ethiopia to examine farmers’ response to soil nutrient deficiencies and its implications for yield responses. We find that farmers’ response to macronutrient (nitrogen and phosphorus) deficiencies is not always consistent with agronomic recommendations. For instance, we find that farmers in our sample are applying nitrogen fertilizers to soils lacking phosphorus, potentially due to lack of information on soil nutrient deficiencies or lack of access to appropriate fertilizers in rural markets. On the other hand, farmers respond to perceivably poor-quality soils and acidic soils by applying higher amount of nitrogen and phosphorus fertilizers per unit of land. We further show that such mismatches between fertilizer applications and soil macronutrient requirements are potentially yield-reducing. Those farmers matching their soil nutrient requirements and fertilizer application are likely to enjoy additional yield gains and the vice versa. Marginal yield responses associated with nitrogen (phosphorus) application increases with soil nitrogen (phosphorus) deficiency. Similarly, we find that farmers’ response to acidic soils is not yield-enhancing. These findings suggest that such mismatches may explain heterogeneities in marginal returns to chemical fertilizers and the observed low adoption rates of chemical fertilizers in sub-Saharan Africa. As such, these findings have important implications for improving input management practices and fertilizer diffusion strategies.


Fertilizer Requirements in 2015 and 2030

Fertilizer Requirements in 2015 and 2030

Author: Food and Agriculture Organization of the United Nations

Publisher: Food & Agriculture Org.

Published: 2000

Total Pages: 44

ISBN-13: 9789251044506

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This is a joint study involving five organisations from both the public and private sectors. The objective is to explore the future need for fertilizer required to support the Food and Agriculture Organization's (FAO) projections of agricultural commodity production for 2015 and 2030. The paper begins by briefly reviewing attempts to identify and quantify the factors influencing the growth in demand and supply for agricultural commodities. Several studies that estimate long-term fertlizer use are also reviewed, followed by a discussion of the forecasting methods and data. The results and implications conclude the paper. The study projects growth rates of between 0.7 and 1.3 per cent, depending on assumptions about nutrient efficiency over the next 35 years


The Global Food Crisis

The Global Food Crisis

Author: Jennifer Clapp

Publisher: Wilfrid Laurier Univ. Press

Published: 2009-09-30

Total Pages: 289

ISBN-13: 1554581982

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The global food crisis is a stark reminder of the fragility of the global food system. The Global Food Crisis: Governance Challenges and Opportunities captures the debate about how to go forward and examines the implications of the crisis for food security in the world’s poorest countries, both for the global environment and for the global rules and institutions that govern food and agriculture. In this volume, policy-makers and scholars assess the causes and consequences of the most recent food price volatility and examine the associated governance challenges and opportunities, including short-term emergency responses, the ecological dimensions of the crisis, and the longer-term goal of building sustainable global food systems. The recommendations include vastly increasing public investment in small-farm agriculture; reforming global food aid and food research institutions; establishing fairer international agricultural trade rules; promoting sustainable agricultural methods; placing agriculture higher on the post-Kyoto climate change agenda; revamping biofuel policies; and enhancing international agricultural policy-making. Co-published with the Centre for International Governance Innovation


State of Food and Agriculture

State of Food and Agriculture

Author: Food and Agriculture Organization

Publisher: Food & Agriculture Organization

Published: 2017-01-12

Total Pages: 196

ISBN-13: 9789251093740

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Unless action is taken now to make agriculture more sustainable, productive and resilient, climate change impacts will seriously compromise food production in countries and regions that are already highly food-insecure. The Paris Agreement, adopted in December 2015, represents a new beginning in the global effort to stabilize the climate before it is too late. It recognizes the importance of food security in the international response to climate change, as reflected by many countries prominent focus on the agriculture sector in their planned contributions to adaptation and mitigation. To help put those plans into action, this report identifies strategies, financing opportunities, and data and information needs. It also describes transformative policies and institutions that can overcome barriers to implementation. The State of Food and Agriculture is produced annually. Each edition contains an overview of the current global agricultural situation, as well as more in-depth coverage of a topical theme."


Achieving Sustainable Development and Promoting Development Cooperation

Achieving Sustainable Development and Promoting Development Cooperation

Author: Department of Economic & Social Affairs

Publisher: United Nations Publications

Published: 2008

Total Pages: 295

ISBN-13: 9789211045871

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This book presents an overview of the key debates that took place during the Economic and Social Council meetings at the 2007 High-level Segment, at which ECOSOC organized its first biennial Development Cooperation Forum. The discussions also revolved around the theme of the second Annual Ministerial Review, "Implementing the internationally agreed goals and commitments in regard to sustainable development."--P. 4 of cover.


The Rice Crisis

The Rice Crisis

Author: David Dawe

Publisher: Routledge

Published: 2012-07-26

Total Pages: 394

ISBN-13: 1136530398

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The recent escalation of world food prices – particularly for cereals - prompted mass public indignation and demonstrations in many countries, from the price of tortilla flour in Mexico to that of rice in the Philippines and pasta in Italy. The crisis has important implications for future government trade and food security policies, as countries re-evaluate their reliance on potentially more volatile world markets to augment domestic supplies of staple foods. This book examines how government policies caused and responded to soaring world prices in the particular case of rice, which is the world's most important source of calories for the poor. Comparable case studies of policy reactions in different countries, principally across Asia, but also including the USA, provide the understanding necessary to evaluate the impact of trade policy on the food security of poor farmers and consumers. They also provide important insights into the concerns of developing countries that are relevant for future international trade negotiations in key agricultural commodities. As a result, more appropriate policies can be put in place to ensure more stable food supplies in the future. Published with the Food and Agriculture (FAO) Organization of the United Nations


The State of Food and Agriculture 2021

The State of Food and Agriculture 2021

Author: Food and Agriculture Organization of the United Nations

Publisher: Food & Agriculture Org.

Published: 2021-11-23

Total Pages: 182

ISBN-13: 9251343292

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The COVID-19 pandemic exposed the vulnerability of agrifood systems to shocks and stresses and led to increased global food insecurity and malnutrition. Action is needed to make agrifood systems more resilient, efficient, sustainable and inclusive. The State of Food and Agriculture 2021 presents country-level indicators of the resilience of agrifood systems. The indicators measure the robustness of primary production and food availability, as well as physical and economic access to food. They can thus help assess the capacity of national agrifood systems to absorb shocks and stresses, a key aspect of resilience. The report analyses the vulnerabilities of food supply chains and how rural households cope with risks and shocks. It discusses options to minimize trade-offs that building resilience may have with efficiency and inclusivity. The aim is to offer guidance on policies to enhance food supply chain resilience, support livelihoods in the agrifood system and, in the face of disruption, ensure sustainable access to sufficient, safe and nutritious food to all.


Biofuels in Africa

Biofuels in Africa

Author: Donald Mitchell

Publisher: World Bank Publications

Published: 2010-11-24

Total Pages: 220

ISBN-13: 0821385178

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A new economic opportunity for sub-Saharan Africa is looming large: biofuel production. Rapidly rising energy prices are expected to remain high for an extended period of time because of the increasing demand in prospering and populous countries such as China and India, the depletion of easily accessible supplies of crude oil, and concern over global climate change. As a result, there is renewed interest in biofuels as an alternative to fossil fuels. Africa is uniquely positioned to produce these new cash crops for both domestic use and export. The region has abundant land resources and preferential access to protected markets with higher-than-world-market prices. The rapid growth in the demand for transport fuels in Africa and high fuel prices create domestic markets for biofuels. The European Union and the United States have approved legislation that requires large increases in the consumption of biofuels over at least the next decade. Imports are expected to be needed to meet these mandates, thus opening the door to African and other developing countries that can produce biofuels or feedstocks for biofuels competitively. Expanding the production of crops for biofuels will affect the entire rural sector in Africa as resources are shifted away from traditional crops and the prices of all agricultural commodities rise. Even smallholders can participate in producing biofuel crops. To promote the sustainability and significant contribution of this enterprise, Biofuels in Africa provides guidance in formulating suitable policy regimes, which are based on protecting the rights of current land users, developing revenue-sharing schemes with local communities, safeguarding the environment and biodiversity, expanding institutional capacity, formulating new regulations and procedures, and emulating best practices from experienced countries. This volume will be of value to anyone interested in biofuels, including policy makers, development practitioners, private investors, researchers, and the general public. Now that African countries are trying to significantly increase their energy supply systems, biofuels are an attractive option using both dedicated crops and agricultural waste. This book provides guidance for them to develop a suitable policy regime for a significant contribution by biofuels. Professor Ogunlade R. Davidson, Minister of Energy and Water Resources, Sierra Leone Biofuels in Africa is a sorely needed resource for our understanding of the problems of expanding biofuels production in Africa. A high point of the book is a description of the projects that were started in several countries. A very useful book! Professor Jos Goldemberg, University of S o Paulo, Brazil As Africa most likely will play the same role for global biofuels as the Middle East does for oil, this comprehensive book on African biofuels should be compulsory reading for anyone interested in either African development or biofuels. The book captures the essence of long-term drivers and opportunities as well the complex challenges for investors and society of this huge emerging industry. Per Carstedt, Executive Chairman, EcoEnergy Africa


World Development Report 2019

World Development Report 2019

Author: World Bank

Publisher: World Bank Publications

Published: 2018-10-31

Total Pages: 201

ISBN-13: 1464813566

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Work is constantly reshaped by technological progress. New ways of production are adopted, markets expand, and societies evolve. But some changes provoke more attention than others, in part due to the vast uncertainty involved in making predictions about the future. The 2019 World Development Report will study how the nature of work is changing as a result of advances in technology today. Technological progress disrupts existing systems. A new social contract is needed to smooth the transition and guard against rising inequality. Significant investments in human capital throughout a person’s lifecycle are vital to this effort. If workers are to stay competitive against machines they need to train or retool existing skills. A social protection system that includes a minimum basic level of protection for workers and citizens can complement new forms of employment. Improved private sector policies to encourage startup activity and competition can help countries compete in the digital age. Governments also need to ensure that firms pay their fair share of taxes, in part to fund this new social contract. The 2019 World Development Report presents an analysis of these issues based upon the available evidence.