Abstract
This study examines the effect of fertiliser subsidy on application rates of fertiliser among maize farmers in Northern Region. The study uses cross-sectional data from 301 households in the northern region of Ghana. The Probit and Tobit models were respectively used to analyse the determinants of participation in the subsidy programme and the effect of participation on fertiliser application rates. The results of the study show that farm size, price of the subsidised fertiliser, distance to input dealers, amount of credit borrowed and off-farm income are key determinants of farmer’s participation in the subsidy programme. Participation in the subsidy programme was found to exert a positive effect on the quantity of fertiliser farmers applied on their farms. The study recommends among other things, the inclusion of cash credit schemes in the subsidy programme as smallholders still found the down payment 79% of the cost of fertiliser high. The study also suggested restructuring in the subsidy programme to allow for channelling of fertiliser through farmer-based organisations (FBOs) in order to curb exploitation by politician and elite farmers. Key words: Fertiliser subsidy, fertiliser use, Ghana.
Highlights
Low crop yields in Ghana are attributed to various biotic and abiotic constraints including low soil fertility
The study examined farm yield response to fertiliser subsidies in Ghana focusing on maize in the Northern Region of Ghana
The study examined the accessibility of the fertiliser subsidy programme, the factors influence participation in the programme and how participation in the subsidy programme affected fertiliser use intensity
Summary
Low crop yields in Ghana are attributed to various biotic and abiotic constraints including low soil fertility. The average fertilizer use in Ghana is only 7.4 kg per hectare of cropland compared to an average application rate of 35.2 kg/ha in Côte d’Ivoire (Benin et al, 2013). This compares with an average of 35.2 kg per hectare applied in Côte d’Ivoire (Benin et al, 2013). Ghana’s Fertiliser Subsidy programme was instituted in 2008 as a direct response to increasing global fertiliser and food prices with the goal of increasing fertiliser use among smallholder farmers and to prevent a decline in crop production below 2007 output levels (Banful, 2009). The goal of the subsidy programme was to increase fertiliser use rate to at least 50 kg/ha as recommended in the Medium Term Agricultural Sector Investment Programme (METASIP)
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