Government's fertiliser subsidy programme risks total collapse following an admission by the Food and Agric Ministry it lacks funds to pay dealers in time for supplies to be made to farmers during the crop planting season.

The suppliers are currently owed several months in unpaid arrears and the inability of government to fulfill its debt obligations has put the fertiliser subsidy programme in limbo, as more dealers are seriously reconsidering their participation in the programme.

Already, Yara Ghana - a company which in 2014 supplied more than half of the market's needs - has opted out of the fertiliser programme, raising fears over a possible drop in crop yields at a time the rainfall pattern has been disappointing in the three northern regions of Ghana, considered the country's food basket.

But the Deputy Minister Food and Agriculture, Dr. Alhassan Yakubu who read a speech on behalf on the minister, told Parliament that government is hopeful of meeting payment demands of the suppliers by end of the year.

He explained that "the ministry is making arrangements with the Finance Ministry to ensure that all payments for the 2015 fertiliser subsidy programme are made by end of the year.

"The main challenge we have this season is delayed and erratic rainfall, which is adversely affecting the cropping calendar in the northern part of the country especially", he said.

The country-wide fertiliser subsidy programme instituted in 2008 is considered one of the unique cases of public-private partnership in which government consulted heavily with fertiliser importers in the design stage, and relied exclusively on the existing private distribution system to deliver fertiliser to farmers as part of efforts to boost production output.

However, challenges with implementation of the programme forced government to relaunch it in March 2015. That notwithstanding, it has become dormant due to government's inability to pay suppliers.

As a result, most farmers are downbeat about recovery of the programme despite assurance by the Ministry of Food and Agriculture that it has concluded discussions with the rest of companies, and that distribution of fertiliser under the subsidy programme has resumed.

The farmers have in recent times been complaining about infrequent support from government under the programme; a situation that they say has been resulting in low yields.

The National Farmers and Fishermen Award Winners Association of Ghana (NFFAWAG) sometime last month appealed for government to release fertiliser subsidies to fertiliser distributors.

Many of the companies had stopped supplying subsidised fertiliser to farmers due to the delay in releasing subsidy amounts to them.

The Chairman of NFFAWAG, Davies Korboe, said the situation has forced farmers to buy fertilisers at high prices on the open market.

He said farmers in the southern and middle belts of Ghana are likely to record low yields because of the weather, compared to what they were getting previously.

With the current situation, farmers are compelled to buy fertiliser at between ?120 and ?130 on the open market.

"As members of the NFFAWAG, we cannot fold our arms and allow our women, peasant and smallholder farmers to go through the pain of buying fertiliser at such prices when, indeed, the government has given them hope of getting it at a subsidised rate," he said.

According to the group, any further delay in resolving the problem could jeorpardise quantities supplied under the programme.

The target groups under the fertiliser subsidy programme are primarily smallholder farmers and women cultivating maize, rice, sorghum and millet.

Mr. Korboe said other fertiliser distributors - including Cherice Ghana Limited, Afcott Ghana Limited, AMG West Africa Limited, Louis Dreyfus Commodities Limited and ETC Ghana Limited - "are battling with issues concerning exchange rate differentials with the Ministry of Finance".

It is the Ministry of Food and Agriculture's expectation that the present application rate of 12kg per hectare will increase to 20kg/ha, as projected in the Abuja declaration of fertiliser use by the African Green Revolution.

According to the sector minister, Fiifi Kwetey, fixing the price will make it unattractive to smuggle the facility to our neighbouring countries.

The programme's introduction has been a contributory factor to improved food production in the country lately, compared to the pre-fertiliser subsidy period.
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