Fertilizer is Nigeria’s largest non-oil export earner – FEPSAN president

Abubakar Sadiq Kassim, the President of the Fertilizer Producers and Suppliers Association of Nigeria (FEPSAN), in this interview, says high cost of production is influencing prices of fertilizers in the market

Nigeria’s export market is facing a lot of challenges. What do you think can be done, and what is your observation regarding what is happening in Nigeria’s import and export markets?

As it relates to fertilizer, I don’t think we have any problem with import and export. The reason is the global dynamics currently happening. For instance, the recent U.S.-Iran-Israel conflict had an impact on the supply chain, particularly for petroleum products and fertilizers. That opened an opportunity for Nigerian fertilizer manufacturers to expand into markets they had not reached before.

The numbers have not yet come back, but the figures already in the system, which the Central Bank of Nigeria (CBN) can confirm, show that fertilizer has become the country’s largest non-oil export earner. I believe this will continue for a long time.

There are also opportunities for the non-urea export market. Nigeria has a blending capacity of close to 10 million metric tons. If we maximize that potential, we will not only supply Nigeria but also the sub-region. We have even received inquiries from countries as far as Brazil asking whether we can supply NPK fertilizers. So the potential is there.

When it comes to actualizing that potential, urea manufacturers have a head start because they are located along the coast. They already have the equipment and export infrastructure. However, blenders located inland do not. They require specialized port infrastructure to support exports, and this infrastructure deficit is a major challenge today.

In terms of competitiveness, what do you think is holding Nigeria back?

It’s mainly infrastructure. If you’re referring to NPK fertilizers, that’s where the challenge lies. For urea, we are highly competitive. We meet international best practices, quality standards, and export demand.

Ask Dangote, Indorama, or Notore—they are all expanding production. Nigeria is positioning itself as a global supplier of choice for urea.

For NPK, the issue isn’t quality or production capacity. We can compete in both. The major hindrances are port infrastructure and internal transportation.

For example, we once received an inquiry from Burkina Faso for 24,000 metric tons of NPK to be delivered through the Port of Lomé in Togo. Despite the proximity, delivering that volume became a major logistical challenge, and we could not fulfill the order.

One possible solution is to explore exports through land borders, especially within the West African sub-region.

Why should delivering to neighboring countries like Burkina Faso through Togo be so difficult?

Because the port and logistics infrastructure simply isn’t adequate. This is one of the major challenges facing the African Continental Free Trade Area (AfCFTA). The biggest obstacle isn’t regulation or government policy—it is physical infrastructure

Sometimes it’s actually cheaper to ship goods from Nigeria to China than to Senegal. In many cases, goods have to be shipped to Europe first before being redirected back to Africa. That simply doesn’t make sense.

Let’s talk about the cost, which is a major concern for farmers. In many cases, a bag of fertilizer now costs more than a bag of maize. Why is this happening, and how can farmers survive?

This is an ongoing discussion among stakeholders, including fertilizer producers.

We acknowledge that fertilizer prices are not aligned with the prices farmers receive for their produce. If fertilizer costs more than the value of the crop produced, then we clearly have a problem.

However, it’s not the fault of fertilizer manufacturers, and it’s not the fault of farmers either. We need to find solutions that bring both sides together because this directly affects food security.

I wouldn’t simply say fertilizer is expensive. It reflects the actual cost of production, considering all the raw materials and inputs required.

One important solution is to increase fertilizer usage so farmers become more productive. If farmers double their yields on the same piece of land, even with current prices, they will still make a profit.

We also tend to compare fertilizer prices with international prices without comparing the prices farmers receive for their crops internationally. Economics doesn’t work that way.

So, in other words, it costs more to produce here?

Exactly. We need to improve productivity and bring more land under cultivation. If a farmer currently harvests two tons of paddy and that doesn’t cover production costs, imagine if he harvests four or five tons. He would recover his costs and still make a reasonable profit.

We have also worked with the government to reduce hidden costs in fertilizer production.

For example, under the Presidential Fertilizer Initiative, the government agency responsible saved more than $46 million by purchasing raw materials at the right time before the Middle East crisis escalated. Those savings were passed to blenders and ultimately to farmers.

Without those savings, fertilizer prices in Nigeria would have been much higher, especially compared to neighboring countries.

That price difference has also created another problem—fertilizer smuggling into neighboring countries like Niger, Benin, and Cameroon. We need policies that ensure fertilizer intended for Nigerian farmers remains in Nigeria.

Is there greater focus on supplying international markets than the domestic market?

No, I don’t think so. Nigeria is richly endowed with natural gas, which gives us a competitive advantage in producing nitrogen fertilizers. We should take advantage of that.

There is enough fertilizer to meet domestic demand. But if local farmers are not buying, manufacturers have no choice but to sell where there is demand.

Many farmers say they don’t receive subsidized fertilizer on time. Sometimes it arrives close to harvest. What do you make of that?

Fertilizer is a commercial commodity. None of our members built their factories solely to supply government programs. Each manufacturer has its own marketing strategy.

If farmers complain about late delivery, it is usually because they are waiting for government-subsidized fertilizer—not because fertilizer isn’t available.

Dangote Fertilizer has about 3 million metric tons of capacity, Indorama around 2.8 million, and Notore also has substantial capacity. Is this enough to meet the needs of Nigerian farmers?

As I mentioned earlier, Nigeria’s annual urea consumption has historically ranged between 750,000 metric tons and 1 million metric tons.

Even if we doubled consumption to 2 million metric tons, Dangote alone has a capacity of about 3 million metric tons. Indorama has around 3 million, while Notore has approximately 1 million. Together, that’s about 7 million metric tons of production capacity.

That means we would still have around 5 million metric tons available for export.

Indorama is already planning another expansion that will increase its capacity to about 4.5 million metric tons. Dangote is also expanding.

There is strong demand both locally and internationally.

Nigeria enjoys a unique strategic advantage. Unlike many other major fertilizer-producing countries, we are not affected by major geopolitical conflicts that disrupt exports. We can ship directly to markets such as Brazil, India, and others without passing through major conflict zones.

Most importantly, Nigeria is fundamentally a gas-rich country. That gives us enormous potential to continue expanding fertilizer production.

For NPK blends, our installed production capacity already exceeds 10 million metric tons, while domestic consumption is only about 1.5 million metric tons. That means there is significant room for growth.

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