Price Hikes in PFJ Fertiliser Subsidy Drive Farmers to Cross Borders
An assessment of last year’s Planting for Food and Jobs (PFJ) programme (2022) and its impact on smallholder farmers across the country by the Peasant Farmers Association of Ghana (PFAG) has revealed that hikes in fertiliser price drove farmers to purchase inputs from neighbouring Togo.
The findings showed that PFJ fertiliser prices escalated from GH¢96 for 50 kilogramme (kg) NPK and GH¢106 for 50kg Urea in 2021 to about GH¢320 for both products in 2022 – constituting a 233 percentage increase.
Executive Director-PFAG, Dr. Charles Nyaaba, said one of the critical points that led to farmers’ disinterest in the programme was the high prices slapped on subsidised fertiliser from 2021 – which reached an all-time peak last year in contrast to prices in neighboring countries.
Consequently, Dr. Nyaaba suggested that the current PFJ should be modified and a value chain approach adopted, as hinted by the sector minister.
Mr. Bryan Acheampong, Minister of Food and Agriculture (MoFA), recently expressed hope that his outfit will soon move away from direct subsidy of fertiliser to enable government assist the private sector to support farmers through input and credit.
The minister made this public when the new president and Chief Executive Officer of the International Fertiliser Development Centre (IFDC), Mr. Hank Van Duijn, paid a courtesy call on him in Accra.
The plan seeks to shift from traditional government fertilizer subsidy programmes to a regime wherein the private sector will support farmers with input credit.
Instead of subsidies on fertiliser, seeds and other inputs, the ministry will from this year implement a value chain approach – whereby aggregators (out-growers) will acquire inputs from government and distribute them to member-farmers.
In 2022, agriculture stakeholders described the PFJ as a waste of government money as the price difference between subsidised fertiliser and the open market price was just about GH¢10.
Meanwhile, government says it will spend some GH¢660million on the PFJ programme in the 2023 implementation year, according to this year’s national budget.
The new intervention is expected to bring stiff competition for quality delivery from fertiliser distributors, as their products will no longer be subsidised by government but sold on the open market.
The decision to scrap the subsidy programme started in 2017 can be viewed as a cost-cutting measure as government desperately tries to reduce expenditure – in line with conditions for the proposed economic bailout from the International Monetary Fund.
Source: Thebftonline