Harare – Fertiliser manufactures in the country say production capacity has dwindled over the past year as forex shortages continue to choke the sector.
Fertiliser Manufacturers Association official, Phillip Nyakudziwanza told a local online publication that despite that the sector has a combined production capacity to produce 1.5 million tonnes of fertiliser, last year it only managed to produce 300 000 tonnes against a local demand target of 600 000 tonnes due to acute shortages of foreign currency needed to buy spares and ingredients.
He said one of the product’s key ingredients, potash is now being manufactured in two African countries while the manufacturers’ sulphuric acid plants now required refurbishment.
The sector’s average production capacity for 2017 into 2018 stood at 34 percent.
In Zimbabwe there are now 12 companies with factories involved in fertilizer manufacturing with most of the newer ones being involved in making blended NPK compounds. Out of these, three companies are involved in the primary manufacture of fertilizer raw materials: These are Dorowa Minerals which mines phosphate rock in Buhera, which is in turn converted to fertilizer grade Phosphates by ZimPhos in Harare. Then Sable Chemicals in Kwekwe manufactures AN from imported ammonia following closure of its electrolysis-based ammonia plants two years ago.
At the secondary level, two companies have granulation capacity that is ZFC and Windmill. ZFC and Windmill also operate blending plants. FSG, Omnia, ETG and several other companies operate blending plants whereby granulated materials are physically mixed to make various grades of NPK compounds. The degree of value addition is obviously higher for primary producers.
The country now requires about 600 000mt including the volumes for the government’s presidential input and cotton schemes, as well as for the command agriculture programme which were a major part of the market in the last few seasons.
Basal compound fertilizers are about half of this demand, while AN and Urea top dressing constitute the other half.
When the country was the breadbasket of the region, farmers were planning well in advance and banks provided facilities that enabled them to buy fertilizers and other inputs well in advance.
The farmers’ unions collected much data from all the farmers and submitted reliable forecasts to the fertilizer industry even a year in advance to enable proper planning, a model which industry players say needs to be re-created for the country to regain its status as a key agro-economy and exporter.
Chairperson of the Zimbabwe Fertiliser Manufacturer’s Association,Tapuwa Mashingaidze estimated that about $135 million of forex would have been required to produce and supply the above volumes of fertilizers assuming that local capacity is fully utilised before supplementary imports of finished products.
Most companies report having secured between 20 to 50 percent at best of their requirements, said Mashingaidze adding that direct forex allocations virtually seized in the second half of the year and most companies were relying on letters of credit by year end, but these were proving difficult to establish as many foreign banks were no longer trusting or accepting guarantees from the country.
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