fertiliser input susbsidy programme in malawi preliminary workshop presentation 2012 13
TRANSCRIPT
1
FISP Implementatio
n 2012/13
Wednesday, 11th July 2013
Andrew Dorward, Ephraim Chirwa, Mirriam Matita, Wezi
Mhango, Peter Mvula School of Oriental and African Studies,
University of LondonWadonda Consult
Outline
Objective – consideration of critical issues for cost effective impact of FISP
Costs Overall costs Tender prices
Impacts Incremental production
Yield responses, displacement & diversionTimingScale, targeting & allocation , distribution,
receipts, redemption & coupon use Maize price impacts Supplier impacts
2July 2013
Information sources
Preliminary report implementation reports (predominantly Logistics Units
weekly reports and annual report), Preliminary analysis of key implementation data from
household survey, sample of 2000 households across 14 districts in the 3 regions, in all livelihood zones
Full report (end August) All the above, with full analysis of relevant household
survey data focus group discussions, key informant interviews with
different stakeholders (Ministry of Agriculture & local government staff, retailers, and different categories of rural people)
‘community survey’ with key informant groups in sampled villages
reports by other organisations
3July 2013
COSTSOverall costsTender pricesFarmer contribution
4July 2013
Programme costs
5July 2013
0
50
100
150
200
250
300
2006/7 2007/8 2008/9 2009/10 2010/11 2011/12 2012/13
US$ millionsTotal estimated other costsOtherTransport CostsNet fertiliserSeeds – maize Seeds - flexi / legumes
0
50
100
150
200
250
300
2006/7 2007/8 2008/9 2009/10 2010/11 2011/12 2012/13
US$ millionsTotal estimated other costsOtherTransport CostsNet fertiliserSeeds – maize Seeds - flexi / legumesAnnual budget
Programme costs
6July 2013
0
50
100
150
200
250
300
2006/7 2007/8 2008/9 2009/10 2010/11 2011/12 2012/13
US$ millionsTotal estimated other costsOtherTransport CostsNet fertiliserSeeds – maize Seeds - flexi / legumesAnnual budgetMalawi GovernmentDirect Donor Support
Programme costs
7July 2013
Tendering
Initial tender call March 2012 opened in May Second call July 2012 awarded mid September
8July 2013
740
760
780
800
820
840
860
880
900
Yafuka
Price NPK, $/mt
Suppliers
Chirimba Kanengo Luwinga740
760
780
800
820
840
860
880
900
Yafuka
Price Urea, $/mt
Suppliers
Chirimba Kanengo Luwinga
Optichem
ParamountRAE
OptionsMzati
ADMARCI Investment
SFFRFM
SFFRFM
ADMARC
0
100
200
300
400
500
600
700
800
900
1,000
2009 2010 2011 2012
Price US$/MT
NPK, landed in depots Urea, landed in depotsDAP, international Urea, E. Europe, BulkFISP cost in markets US$/MT FAM prices US$/MT
Fertiliser cost & price comparisons
9July 2013
2012/13 exchange rate: 365MK/US$
Farmer contributions
Farmer contributions have fallen since establishment of FISP from around 35% to 3% of fertiliser cost
10July 2013
0%
5%
10%
15%
20%
25%
30%
35%
40%
2005/6 2006/7 2007/8 2008/9 2009/10 2010/11 2011/12 2012/13
IMPACTS Incremental production, displacement &
diversion Yield responses Timing Scale of programme Targeting & coupon use
Maize price impactsSupplier impacts
11July 2013
Yield responses
Difficulties in obtaining reliable information on smallholder yields and yield responses
New information from commissioned maize simulation study under smallholder conditions (Anthony Whitbread et al, Goettingen University)
Historical weather records (1928 -2004) Different soils Smallholder crop management (planting times,
weeding regimes, fertiliser rates and timing, plant densities, varieties)
Realistic results Average yields Critical yield factors Nutrient (nitrogen and phosphate responses)
12July 2013
Illustrative N Response, hybrid without & with P
13July 2013
Illustrative N Response, local without & with P
14July 2013
Simulated yield response
Good potential returns to N and impact Importance of
hybrid seed early planting good agronomy potential for lower N rates variable returns to N
Planned further work Further analysis of simulation results Analysis of On Farm Trial results Analysis of IHS3 crop data Analysis of Crop Cutting data Incremental legume production?
15July 2013
Timing
early planting needs early access to seed & fertiliser ……….
16July 2013
7
8
9
10
11
12
Fertilisertenders
Voucherallocations
Transporttenders
Voucherprinting
Voucher &lists to
districts
Seedsupply
contracts
Month
2006/7
2007/8
2008/9
2009/10
2010/11
2011/12
2012/13
Completion of contracts & voucher processes
17July 2013
Depot receipts timing, % parastatal fertiliser sales
18July 2013
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
End Sept % End Oct % End Nov % End Dec %
2006/7
2007/8
2008/9
2009/10
2010/11
2011/12
2012/13
Uplifts timing, % total by month
19July 2013
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
End Sept % End Oct % End Nov % End Dec %
Uplifts % total
2006/7
2007/8
2008/9
2009/10
2010/11
2011/12
2012/13
Targeting: allocations, distribution & access
Good targeting should promote: Low diversion / losses Low displacement Effective input use Poor & vulnerable
1. Scale of programme & disbursements2. Area targeting:
regional & district distribution3. Household targeting:
beneficiary characteristics coupon access & redemption
20July 2013
21July 2013
Subsidy sales : fertilisers
0
50
100
150
200
250
2005/6 2006/7 2007/8 2008/9 2009/102010/112011/122012/13
Fertiliser sales ('000 MT)
Actual tobaccofertiliser
Actual maizefertiliser
Fertiliserbudgeted
22July 2013
Subsidy sales : fertilisers & seeds
0
2
4
6
8
10
12
0
50
100
150
200
250
2005/6 2006/7 2007/8 2008/9 2009/102010/112011/122012/13
Seed sales ('000MT)
Fertiliser sales ('000 MT)
Axis Title
Actual tobaccofertiliser
Actual maizefertiliser
Fertiliserbudgeted
Maize seed
Hybrid seed
Legume seed
Total fertiliser voucher redemptions (millions)
23July 2013
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0
2005/6 2006/7 2007/8 2008/9 2009/10 2010/11 2011/12 2012/13
North Centre South All
0.0
0.5
1.0
1.5
2.0
2.5
2005/6 2006/7 2007/8 2008/9 2009/10 2010/11 2011/12 2012/13
North Centre South All
0.0
0.5
1.0
1.5
2.0
2.5
2005/6 2006/7 2007/8 2008/9 2009/10 2010/11 2011/12 2012/13
North Centre South All
Fertiliser vouchers redeemed per farm family
24July 2013
MoAFS farm families
NSO rural households
Beneficiaries per farm family by district
25July 2013
0%
10%
20%
30%
40%
50%
60%Ch
ikhw
awa
Nsa
nje
Lilo
ngw
eD
edza
Man
goch
iM
achi
nga
Kasu
ngu
Nkh
ota
Kota
Karo
nga
Ntc
hisi
Mul
anje
Salim
aM
chin
jiN
khat
a Ba
yD
owa
Mzi
mba
Bala
kaN
tche
uZo
mba
Chira
dzul
uCh
itipa
Nen
oBl
anty
reM
wan
zaTh
yolo
Liko
ma
Phal
ombe
Rum
phi
How many coupons received by how many households?
26July 2013
2.7 million (NSO) or 4.4 million (MoAFS) rural/ farm households?Note: Receipts by urban households are omitted (about 5% of rural receipts)
2012/13 2010/11 2008/9
Fert. MaizeLegum
e Ferti. Maize Legume Fert. Flex
Coupons received per hhold
0.78 0.39 0.28 1.13 0.68 0.41 1.12 0.57Estimated total coupons, NSO hh ('000)
2,131 1,078 776 2,733 1,613 968 2,794 1,419Estimated total coupons , MoAFS hh ('000)
3,427 1,733 1,247 4,420 2,649 1,600 4,108 2,087
MoAFS Total Voucher redemptions ('000)
2,979 1,529 1,427 3,183 1,988 1,363 4,046 2,758
Fertiliser Coupon Receipts & Targeting
27July 2013
Coupons/hh
2012/13 2010/11 2008/9 2006/7
0>0 to
1>1 Mean 0 Mean 0 Mean 0 Mean
North 47% 9% 43% 2.22 24% 1.81 28% 2.03 38% 1.9Centre 41% 47% 12% 1.09 31% 1.34 35% 1.42 45% 1.7South 38% 43% 19% 1.30 11% 1.46 33% 1.49 49% 1.7National 40% 41% 19% 1.30 21% 1.44 33% 1.52 46% 1.7Poor 45% 42% 13% 1.14 29% 1.29 25% 1.34 50% 1.49Ovutika 36% 44% 19% 1.32 19% 1.42 20% 1.39 35% 1.6Ovutikilako 38% 38% 24% 1.34 21% 1.42 24% 1.56 30% 1.91>=wapakatikati
47% 27% 27% 1.74 17% 1.69 24% 1.6 26% 2.81
Perceptions of likelihood of different types of people getting coupons
28July 2013
Scores: 1 = more likely; 2= no difference; 3 = less likely
Total
Poor people 1.97Female headed hh 2.07More productive farmers
2.09
Hh with orphans 2.04Better off hh 2.12Civil servants & teachers
2.48
VDC members 1.79
Average scores mostly around 2: no difference – no apparent clear targeting
29July 2013
Open meetings inRedistr-ibution?
Suppl-ementary?
Allocation
Distribution
North 97% 98% 37% 1%Centre 65% 77% 64% 2%South 70% 77% 66% 17%Total 71% 79% 62% 9%
Fertiliser voucher allocation & distribution: open meetings?
Village head/TA
VDC Agric. staff
Villagers in open
meeting North 67% 21% 0% 6%Centre 79% 8% 4% 4%South 69% 8% 4% 5%Total 73% 9% 4% 5%
But who actually decides on allocations?
Fertiliser voucher allocation & distribution: beneficiary List
30July 2013
List? Public?
Place publishedVillage head house
School/Health Centre
Agric. Office
ADMARC/Input
MarketNorth 95% 7% 75% 0% 11% 7%Centre 73% 40% 66% 27% 0% 3%South 76% 46% 59% 22% 3% 9%National
77% 38% 63% 23% 2% 7%
When published?Seen by
hh?
HH member included?
<=Oct Nov Dec JanNorth 38% 45% 10% 7% 31% 87%Centre 46% 39% 14% 1% 36% 80%South 51% 42% 4% 2% 33% 81%National
49% 41% 8% 2% 34% 82%
Beneficiary List – perceived receipts by listed householdsAmong those who saw the list… % who think nearly all those listed received
31July 2013
at least part of a fertiliser coupon
two or more
fertiliser coupons
North 61% 22%Centre 34% 6%South 75% 23%National 56% 16%
Perceptions of quality of allocation & distribution processes
32July 2013
Scores: 4 = very good; 3= good; 2 = not good not bad; 1= bad; 0 = very bad
0
0.5
1
1.5
2
2.5
3
3.5
2005/6 2006/7 2007/8 2008/9 2009/10 2010/11 2011/12 2012/13
Number of coupons Timing of distribution
Distribution methods Allocation criteria
Preferences for targeting criteria
33July 2013
Scores: 4 = very good; 3= good; 2 = not good not bad; 1= bad; 0 = very bad
0
0.5
1
1.5
2
2.5
3
3.5
2008/9 2010/11 2012/13
targeting ‘the poor ‘ (100kg)targeting ‘the productive ‘ (100kg)
for all hh, with ½ the amount (50kg)
Coupon payments
Just over 1% of fertiliser coupons were reported as obtained with some payment (2% in 2010/11, 5% in 2008/9 and 2006/7)
Reported sources included traders, TAs and headmen, and agricultural staff, with traders about twice as common as each of the others
Reported prices varied from MK200 to MK6,500 (with a mean of around MK1750 and median of around MK750
34
Coupon use and redemption
95% fertiliser coupons & 97% maize seed coupons and 91% legume seed coupons used to buy inputs
Limited coupon sales (5% fertiliser coupons, v few seed coupons)
9% of households paid a ‘tip’ to redeem their fertiliser coupon (same as in 2010/11, 14% in 2008/9, 20% in 2006/7), most commonly paid between MK750 and MK1,000 extra. Mean redemption payment was around MK1,300
35
Coupon redemption
36July 2013
Hours travel & waiting
Transport & misc expenses
(MK)
Distance to nearest
ADMARC / SFFRFM (km)
Distance to nearest
private selling point (km)
Median Median Median Median2012/13
8 250 5 6
2010/11 12 200 4 62008/8 9 200 5 82006/7 7 150 5 5
Coupon redemption
Most beneficiaries got the fertiliser they wanted (99%) Maize seed beneficiaries: 84% got the variety they
wanted, 13% wanted a different hybrid variety, very few (around
1%) wanted but could not have an OPV. Legume seed beneficiaries: 94% of beneficiaries got
what they wanted
37July 2013
Seed coupon redemptions: variety shares
38July 2013
Household survey
Reported sales (LU)
Maize seed redemptions
Hybrid 85% 78%
OPV 15% 22%
Legume seed redemptionsBeans seed 17% 23%
Cow peas seed 1% 1%
Groundnuts seed 59% 65%
Soya Seed 14% 8%
Pigeon pea 2% 2%
Coupon redemption: financing
39July 2013
General savings
GanyuFamily/
neighboursOther
2012/13 62% 20% 7% 9%
2010/11 72% 15% 5% 8%
2008/9 77% 11% 6% 5%
Serious redemption problems experienced, % customers by outlets
40July 2013
Fertiliser Maize seedADMAR
CSFFRM
Parastatal
ChainAgrodeale
rLong queues 47% 50% 32% 14% 7%Queue jumping 37% 47% 23% 9% 5%Scrambling/fighting
34% 21% 30% 16% 12%
Vendors 33% 27% 22% 4% 3%Long distance 32% 25% 16% 4% 10%Slow service 28% 34% 13% 3% 3%Gender violence 26% 15% 18% 5% 2%Late /early hours 24% 23% 11% 7% 2%Demands for ‘tips’
21% 9% 9% 9% 2%
Input shortages 20% 13% 8% 3% 1%No M/F toilets 18% 25% 13% 3% 5%No toilets 17% 23% 15% 7% 6%Sexual demands 11% 4% 3% 6% 1%Abusive language
8% 0% 3% 3% 0%
No drinking water
3% 1% 1% 6% 0%
Stake holder roles in fertiliser redemption (% respondents)
41July 2013
ADMARC SFFRFM
Not present
Present Not presen
t
Present
Helpful Problem HelpfulProble
mVendors 59% 2% 29% 72% 0% 23%Police 42% 51% 2% 44% 53% 0%VDC members
27% 61% 3% 29% 59% 1%
Market committee
57% 24% 3% 52% 32% 0%
Village head 13% 75% 3% 10% 83% 1%Market Clerk 49% 32% 5% 50% 32% 0%Other Market officials
60% 19% 4% 63% 18% 0%
Politician 85% 5% 1% 88% 7% 0%Agricultural Officials
56% 28% 2% 60% 29% 1%
Subsidised input use
42
Almost all coupon fertiliser was used in people’s own garden or shared with others (3%), and almost all was applied to different maize varieties
Local 26%
OPV 11%
Hybrid 63%
Burley 0%
Almost all coupon seed was used in people’s own gardens.
Hybrid maize
OPV maize
Soya seed
G/Nuts seed
Beans seed
Other specify
Pigeon pea
Own garden
96% 92% 88% 87% 80% 100% 92%
Shared 1% 2% 2% 1% 1% 0% 0%Sold 0% 0% 0% 0% 1% 0% 0%Kept 2% 6% 5% 2% 1% 0% 0%Other 1% 0% 5% 9% 17% 0% 8%
Diversion? Transport losses?
No of companies commissioned2008/09 232009/10 262010/11 252011/12 232012/13 43
Logistics Unit reported 608MTS lost (0.4%) & MK108 mill (0.2%)
Logistics Unit also reported 4,902MT stock balance expected (3.2% of voucher redemptions)
Tampered vouchers: 13,083 (0.4%)
43July 2013
Input supply impacts: fertiliser procurement from private co. & parastatals
44July 2013
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
0
50
100
150
200
2005/6 2006/7 2007/8 2008/9 2009/102010/112011/122012/13
'000 metric tons
Brought forward MTS Parastatal tenders MTS
Private sector tenders MTS Private sector % new supplies
Outstanding invoice payments by season
45July 2013
0%
10%
20%
30%
40%
50%
60%
0.00
2.00
4.00
6.00
8.00
10.00
12.00
14.00
16.00
2006/7 2007/8 2008/9 2009/10 2010/11 2011/12 2012/13
MK billion End Nov (MK bill)
End Dec (MK bill)
End Jan (MK bill)
End Nov %
End Dec %
End Jan %
Summary / conclusions
Cost control – good as regards budgeted costs, potential for reducing costs & diversion with larger farmer contributions
Timing of tender processes is critical (but if earlier then other processes & transport /storage may become limiting)
Preliminary simulation yield response information is promising, & suggests positive returns to FISP and importance of early input access
Targeting – there are declining fertiliser coupons per hh, a more even regional balance, & no clear household targeting. Open meetings & beneficiary lists are being implemented, but more enforcement of their proper use is needed
Redemption problems reported are much as expected & need on-going attention
Difficult to estimate scale of diversion – needs careful attention & constant innovation (coupon security is better but transport security a concern…)
46July 2013
47
Thank you
This material has been funded by UKaid from the Department for International Development; however the views expressed do not necessarily reflect the organisations’ official policies.