Project amount: $2 million
Approval date: September 2023
Status: On-going
Project Description

This project consists of a $2 million partial trade credit guarantee and a $877,980 grant from the Africa Fertilizer Financing Mechanism to the African Fertilizer Agribusiness Partnership for the Fertilizer Financing for Sustainable Agriculture Management project in Mozambique. The project aims to increase the agricultural productivity of selected crops by 20% by facilitating timely access to fertilizer and appropriate use by smallholder farmers. It has four components: (i) facilitate access to finance; (ii) support increased fertilizer availability; (iii) soil health management and extension services; and (iv) project management and coordination. The project will distribute metric tons of 60,000 fertilizer to 300,000 smallholder farmers through 5 suppliers, 30 hub agro-dealers, and 125 retail agro-dealers. 5% of these farmers will receive training, and 40% of the targeted farmers will be women. The credit guarantee is expected to be leveraged 15 times.

The market

The emergency of large rice, maize, and soybeans out-grower schemes in Gaza, Niassa, Nampula, Manica and Sofala provinces in Mozambique has led to increased demand and usage of fertilizers for production of these food crops. The country is, therefore, a growing market, and with the correct approach, developing the market over the medium to long term is possible.

Development

In the short term, the anticipated outcomes are an increase in the quantity of fertilizers supplied to farmers, enhanced agricultural production, the adoption of Integrated Soil Fertility Management and sustainable farming practices. In the midterm, the project would have achieved increased profitability for agrodealership, improved soil fertility, strengthened environmental safeguards, and trigger higher incomes for farmers.