Agricultural Inputs

Fertilizer is a critical input for agricultural productivity, and its increased use has been closely associated with rising agricultural yields in many countries. In developing economies that rely heavily on fertilizer imports and are home to vulnerable smallholder farmers, fertilizer price spikes can pose serious risks. When farmers lack access to effective risk-sharing mechanisms, sudden or excessive increases in fertilizer prices can discourage adoption, disrupt planting decisions, and reduce productivity.

Since the outbreak of conflict in April 2023, Sudan has seen deteriorating food security and economic activity, disrupted markets and agrifood systems, and a steadily building humanitarian crisis. According to a new policy note from IFPRI’s Sudan Strategy Support Program, if steps are not taken to protect livelihoods and food security, 4 million people could fall into poverty and an additional 2 million could face food insecurity and malnourishment by 2028.

During 2021 and 2022, global food and fertilizer prices spiked due to several overlapping factors. Demand rose as the world economy emerged from the COVID-19 recession; global supply chains suffered major disruptions associated with the uneven recovery; and the outbreak of war between Russia and Ukraine—both key food and fertilizer producers—generated yet another shock.

Since the 1950s, Malawi has used a national fertilizer subsidy program as a way to spur use of inorganic fertilizers, boost domestic maize production, and ensure food security and self-sufficiency for smallholder farmers. According to new working paper from the Malawi Strategy Support Program, however, the national subsidy program may not be the most efficient investment for improving the country’s food security and domestic production goals.

Africa’s agricultural sector has the potential to drive important economic growth and development in the region. Agriculture accounts for 16 percent of Africa’s annual GDP and employs over half of its labor force, particularly youth and women workers. Despite the sector’s vast potential, however, African agriculture remains hampered by low resource productivity and little or no value addition; shocks like climate change, ongoing regional and local conflict, and supply and market disruptions resulting from the COVID-19 pandemic and global conflicts have only exacerbated these challenges.