Russia-Ukraine War: NSIA Allays Fears Of Fertiliser Scarcity

….Says Nigeria Has Adequate Stock To Last For One Year

The Managing Director and the Chief Executive Officer of the Nigerian Sovereign Investment Authority, Uche Orji, has said that Nigeria has enough supply of the raw materials needed for fertilizer production that will last the country for a year.

The disclosure comes a few days after Africa’s richest man, Aliko Dangote, expressed fears over the supply of fertilizer amid the Russia-Ukraine crisis.

The billionaire had advised the Federal Government to ban the exportation of maize over the looming scarcity of the agro-produce which he said would be driven by fertilizer shortages.

Dangote had said, “Right now, you would start seeing people exporting maize to earn foreign exchange, which I think we need to stop so that we don’t create a shortage, and we need to make sure we grow more so we don’t have shortage. It is about food security, and it is very serious.”

There have been fears across the globe that the Russia-Ukraine crisis may lead to food scarcity. In the US and Europe, food prices and energy costs have risen.

Russia and Ukraine account for almost 30 per cent of the world’s urea and 26 per cent of the world’s potash which are needed for fertilizer production.

Russia alone accounts for 24 per cent of the world’s total reserves of 6,923 Tcf which  is very essential for fertilizer making.

But the NSIA boss said the country has prepared for a time like this since the introduction of the Presidential Fertilizer initiative in 2017.

“There is substantial material on the ground at the moment to get us through the rest of the year. We are doing a lot of work to get alternative supply,” Orji said during a programme on Arise TV on Tuesday.

The NSIA had sealed a $1.4bn Fertilizer deal with OCP Morocco in 2021 to domesticate the production of fertilizer blends in Nigeria.

Nigeria buys ammonium phosphate from Morocco, potash from Russia and Urea from Indorama. These constitute the ingredients needed for Nigeria’s fertilizer specification.

Orji said, “It (Russia-Ukraine war) is  a big threat. There is no way to sugar coat it. It is something the world is prepared for.  But I will say two or three things.

“First of all, we had been a little bit lucky last year, we over supplied the market last year. So, for Nigeria, there is still a substantial amount of inventory in the channel which I believe will help us navigate the early phases of this dislocation.

“The second point is that we are now thinking of an alternative supply of potash which I hope will bear fruit within the next few days and so we will be able to continue to have potash which is out of our overall blend coming.

“At the moment, we are focused on the availability. It is not just potash from Russia. The worst comes to natural gas.”

Orji said natural gas is essential for ammonium phosphate, urea and many other things in the fertilizer subsector.

He added, “The price of natural gas has gone up more than 400 per cent. That is having a knock on effect on the prices of raw material, but I will say the following.

“I don’t see any reason for panic just yet, because we have a significant quantity of raw materials carried over from last year into this year.

“We’ve had a strategy of the structure of the supply to ensure that we don’t have this type of situation.

“So, I’m hoping that with what we are doing now and in the next couple of days, we will be able to completely sort out our alternative supply sources of potash.

“Urea is a dominant component of that and we have two major producers in Nigeria. We have Indorama and Dangote and so we are not short of that.

“Phosphate comes from Morocco, that has not been affected by the issue of Ukraine- Russia and we have vessels on their way for phosphate from Morocco.”