Fertiliser Association of Malawi says local firms are failing to benefit from the declining global prices and low demand for fertiliser due to foreign exchange  challenges.

In a written response on Sunday, the association’s executive administrative officer Mbawaka Phiri said the firms are struggling to order new stock as fertiliser has to be purchased using United States dollars.

Phiri: Demand
is fairly low

She said: “Currently, global prices are on a downward trend though it is not yet at the pre-2020 levels.

“Demand is also fairly low at the moment which makes it the best time for companies to try and import stock for the coming season.”

The World Bank earlier projected global commodity prices to decline this year at the fastest pace since the onset of the Covid-19 pandemic, improving growth prospects of almost two-thirds of developing economies that depend on commodity exports.

The Bretton Woods institution’s figures show that in the first quarter of this year, Urea prices averaged $371.58 per metric tonne (MT) from $581.46 per MT in the previous quarter.

The bank attributed this declining trend to increased availability of natural gas in Europe, a development which has lowered the cost of fertiliser production and increased supply of the commodity.

Meanwhile, preparations for this year’s Affordable Inputs Programme (AIP) implementation are underway.

In an earlier interview, Minister of Agriculture Sam Kawale confirmed that the procurement process for the 2023/24 fertiliser contracts was almost finished.

In the 2023/24 National Budget, AIP has been allocated K117 billion.

Last year’s number of beneficiaries was reduced to 2.5 million from 3.7 million the previous season.

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