Fertilizer situation and markets in Malawi

This position underscores Malawi"s need for self-sufficiency in agriculture, which is the mainstay of the nation"s economy, accounting for 40% of the gross domestic product and 95% of export earnings. Fertilizer marketing in Malawi is in the early stages of development. Fertilizer use increased at an average of 6% per annum during the past decade and totaled 43,000 tons in 1988. The country has two independent fertilizer marketing systems -- one serving the smallholder and the other the large estates. The smallholder system is subsidized and serves approximately 1.2 million farmers who cultivate 1.3 million hectares, or about 78% of the total area. The 1988/89 fertilizer subsidy amounted to about 42% of the total fertilizer cost. The estate system is private and operates on a free market basis. According to this report, the outlook for the Malawi fertilizer sector is favorable, particularly in the smallholder sector. With increased emphasis on fertilizer marketing and increased food production, it is expected that fertilizer use will increase by an average of 7.8% per year during the next 7 years and total 206,000 tons in 1995. The smallholder sector will account for 52% of the market.