Zambian fertiliser subsidy programme keeps chemical company afloat

The firm Nitrogen Chemicals of Zambia (NCZ) has appealed to the government to invest in the company in order for it to continue supplying fertiliser to the Fertiliser Support Programme (FSP).

NCZ is supplying 25,000 metric tones of compound D fertiliser to the FSP programme for the 2007/2008 farming season. Speaking at the launch of the FSP input distribution exercise for the season, NCZ managing director Richard Soko bemoaned the poor condition of most plant units and lack of working capital at his company, which resulted in it operating at low capacity. He said that if sufficient recapitalisation funds could be availed, there was no doubt NCZ could be viable and easily return to profitability.

The company is taking a number of initiatives aimed at improving its operational status, and believes the government’s assistance is required to attain full capacity. “We would like to appeal to government, as a major share holder, not to allow the plant to go to waste but to recapitalise it
fully as the country stands to benefit."

Since the FSP’s inception in 2001, NCZ has supplied a total of 110,000 metric tonnes of basal dressing fertiliser to the programme. The contract to supply fertiliser has greatly helped in sustaining the NCZ. Without it, the continued existence of the company may not have been possible.

Soko said investigations had shown that last season's incidences of underweight bags were as a result of having been tampered with by "unknown people." NCZ had put in place elaborate systems aimed at ensuring that the fertiliser meets the set specifications in both quality and quantity.

Agriculture and Cooperatives Minister Ben Kapita said the FSP has been allocated K150 billion ($40 million) this season for the implementation of the programme. The programme planned to procure 50,000 tonnes of fertiliser; 25,000 basal and 25,000 top dressing fertiliser, as well as 2,500 tonnes of maize seed. The programme has targeted to support an estimated total of 125,000 small-scale farmers at 60 per cent subsidy.

Times of Zambia