Farmers Forced to Buy Subsidized Fertilizer at Higher Rates

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Farmers Forced to Buy Subsidized Fertilizer at Higher Rates

September 30: A study conducted by Nepal Seed and Fertilizer Project (NSAF) has found that the subsidized chemical fertilizer given to the farmers by the government is being sold at a higher price than the price fixed by the government itself.

NSAF, in collaboration with Agricultural Inputs Company Limited and the Salt Trading Corporation, studied 828 cooperatives across the country that distributed subsidized chemical fertilizers between 2018 and 2019. The price of fertilizer paid by the farmers and the actual demand and supply were also studied.

According to the study report, farmers paid Rs 16 to 21 for a kilogram of urea which costs Rs 14. Similar is the prices of other fertilizers. Farmers had to pay Rs 45 to 50 for DAP fertilizer whose actual price was Rs 43 per kg, and Rs 33 to 37 for potassium costing just Rs 31 per kg. All the cooperatives included in the study received an average of 84 metric tons of urea, 64 metric tons of DAP and 13.3 metric tons of potassium. About 85 percent of the cooperatives claimed that the chemical fertilizers they received were much less than the demand.

Stating that the government has been able to import only 50 percent of the total demand for chemical fertilizers in Nepal, Dr Udit Man Chaudhary, the coordinator of NSAF, claimed that farmers have been forced to buy fertilizers at a higher price than the price cooperatives should have sold the fertilizers. He said that farmers are bound to suffer when the demand is high and the supply is low.

As mentioned in the study, Nepal is behind India, Bangladesh and Sri Lanka in terms of availability of chemical fertilizers to farmers in South Asia. As a result, Nepal has not been able to significantly improve productivity. According to a study conducted by NSAF in 2016, 74 kg of chemical fertilizers are used per hectare in Nepal, which is 166 kg in India, 289 kg in Bangladesh and 132 kg in Sri Lanka. Providing quality fertilizers to farmers at the right time has become the biggest challenge in Nepal.

According to Rajendra Bahadur Karki, managing director of Agricultural Inputs Company Limited, who is in charge of import of government-subsidized fertilizers, no other charge is added except for the transportation fee from Birgunj, Biratnagar and Bhairahawa godowns of the company. He said that due to the cost of transportation, they have to charge a little more. However, in rural areas, farmers have to pay more than the maximum price fixed by the government, the report states.

Agni Aryal, coordinator of Rajapur Paddy Super Zone, says that although the price of one kg of urea has been fixed at Rs 14 per kg by the government, most of the farmers in Banke, Bardia, Kailali, Kanchanpur etc. have to pay Rs 50 to 60 per kg. He claims that the prices of other fertilizers are also higher than those set by the government. A large amount of chemical fertilizers are also illegally imported from the Indian border.

Chandrakant Dallakoti, president of Nepal Fertilizer Entrepreneurs Association says, “Since the government is unable to provide fertilizers as per the demand of the farmers, they are compelled to bring fertilizers illegally from the Indian border at rates that are double or triple the actual price. In addition, the farmers also face problems due to the government being unable to find a third option other than India to import fertilizers.”

On the one hand, the budget allocated by the government for the purchase of fertilizers is limited. While on the other hand, due to fluctuations in the international market, the amount of fertilizers entering the country is decreasing. Therefore, if the farmers do not get the fertilizer they need, they have to find other alternatives.


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