Farai Mabeza, Senior Staff Writer 
ZIMBABWE has started to draw down on a US$11 million facility from the Africa Export and Import Bank (Afreximbank) to more than double its Ammonium Nitrate (AN) fertiliser production in time for the next farming season.
Following a bumper harvest this year the government is undertaking reforms to the agricultural value chain to anchor economic growth going forward.
Last year, the country’s sole manufacturer of AN, Sable Chemicals, produced 16 000 tonnes of the 300 000 tonnes required in a normal agriculture season, with the balance being met through imports.
But according to Sable Chemicals chief executive, Bothwell Nyajeka, the expansion project will see the country’s AN output grow to 50 000 tonnes in 2022 then to 100 000 tonnes the following year.
Sable Chemicals chief executive, Bothwell Nyajeka
“We have started implementing a US$11 million capital expenditure programme which will see us investing in our plant in Kwekwe and increasing the number of tank cars that we use to ferry ammonia gas from South Africa to the plant. This programme is being financed by Africa Export and Import Bank (Afreximbank),” Nyajeka, told The Financial Gazette this week.
“For the 2021/22 summer season we are targeting to produce 50 000 tonnes of Ammonium Nitrate fertiliser. We will double production in the following season, 2022/23”.
For the current season Nyajeka said production has been affected by inadequate foreign currency supplies but the auction system introduced by the Reserve Bank of Zimbabwe last year had eased the company’s plight.
“The result of the prevailing uncertain outlook and cascading effects of the Covid-19 pandemic as well as the general shortage of foreign currency in the economy, had a negative impact on production.
“For the current season, the issue around foreign currency availability has been resolved with the introduction of the foreign currency auction system by the Reserve Bank,” he said.
“Primary producers like Sable Chemicals, whose key inputs are imported, were affected the most because of supply chain disruptions to logistics firms,” he said.
Last year, the government announced a Five-Year Fertiliser Import Substitution Roadmap, which will be largely focussed on ramping up production at Sable Chemicals, and Chemplex Phosphates.
Under the plan it is envisioned that an investment of about US$40 million would see Sable Chemicals increasing output to 240 000 tonnes of AN by 2024 while US$36 million invested in Chemplex’s subsidiaries — ZimPhos and Dorowa Mines ― would increase phosphates production to 100 000 tonnes from 80 000 tonnes while bringing down imports to 140 000 tonnes from 180 000 tonnes.
Chemplex is presently utilising 75 percent of its capacity.
Zimbabwe spent U$622 million on fertiliser imports over the past seven years.
According to the roadmap, had local fertiliser producers been adequately supported, the government would have spent US$400 million.
The new plan seeks to correct this state of affairs by redirecting resources to significantly reduce fertiliser imports in the next five years through capacitating local companies.
This comes as Zimbabwe Fertiliser Association chairman, James Chigwende, recently said producers were anticipating price volatility on international markets due to Covid-19 supply chain disturbances.
“Prices are influenced by the global supply position as fertiliser is an international commodity, as well as stability in the local market. For the next few years, we expect price volatility however, due to disruptions in the supply chain due to Covid-19. In this regard it is important that we improve local production capacity,” Chigwende told The Financial Gazette.
He added support for agriculture from the government would remain a key stimulus for production.
“Broadly, the future of agriculture in Zimbabwe largely rests on the sustainability of funding mechanisms by the government to the sector and timely availability of such funding,” he said.
Zimbabwe has 12 fertiliser companies, with some of them involved in making blended NPK compounds. These are multi-nutrient fertilisers containing some percentage of all three of the major nutrients ― nitrogen, phosphorus and potassium.
These products are intended to allow for complete fertilisation of a crop with a single application.
FSG, Omnia, ETG and several other companies operate blending plants whereby granulated materials are physically mixed to make various grades of NPK compounds.
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