Nigeria purchased emergency supplies of Canadian potash in April after being unable to import the critical fertiliser from Russia owing to the impact of Western sanctions, according to the president of Nigeria’s sovereign investment agency, NSIA.
NSIA’s head, Uche Orji, declined to comment on prices. However, spot rates for deliveries to west Africa have increased by more than 250 percent in the previous year, according to commodities pricing service Argus Media, wreaking further havoc on the country’s economy.
This is one of the unforeseen negative outcomes of sanctions imposed on Russia in response to its invasion of Ukraine, which Russia refers to as a “special military operation.”
The additional burden comes as many countries continue to grapple with the aftermath of the protracted COVID-19 outbreak.
Nigeria has been grappling with double-digit inflation for years, which accelerated to 15.92 percent this month, and its 200 million people will face significantly higher food prices this year and next as the agricultural industry passes on the increased costs of imported wheat, diesel, and fertiliser.
“Because Russia was unable to supply, we purchased spot from Canadian merchants. The Canadian High Commission in Nigeria assisted in initiating contact with manufacturers “Orji stated to Shauntv
NSIA negotiates the import of raw fertiliser materials such as potash as part of the Nigerian government’s capacity development programme for blended fertiliser production.
Orji stated that Nigeria has sufficient potash supplies to meet 40% of blending demand and has purchased three cargoes of Canadian potash that are expected to arrive within the next month. The country normally accepts five Russian cargoes each year.
Western sanctions and self-sanctioning by a number of global firms and financial institutions have wreaked havoc on anyone dealing in Russian-origin items and driven several energy and commodity prices to all-time highs.
Since 2019, Uralkali of Russia, a major global producer of the crop fertiliser, has been Nigeria’s sole supply.
Uralkali did not respond to a request for comment. The Canadian government, according to a spokesman, “is aware of the difficulties associated with sourcing potash as a result of Russia’s invasion of Ukraine, and we are collaborating closely with our Nigerian colleagues to identify sustainable alternatives.”
While the potash producer has escaped sanctions thus far, Russian tycoon Dmitry Mazepin resigned from the board and sold his controlling position in Uralchem after being sanctioned by the EU in March. Uralchem is the largest shareholder in Uralkali.
Orji stated that conversations were ongoing to see whether a Russian delivery might still take place.
Since last year, when the EU put sanctions on Belarus, the world’s third largest producer after Russia and Canada, the price of potash has increased.
The price jumped to a record $1,125 per tonne in late April as a result of Russia’s financial penalties, according to commodity pricing service Argus Media. Belarus and Russia together account for 38% of global potash supply, which are currently in doubt.
According to the local fertiliser group FEPSAN, Nigeria imported almost 200,000 tonnes of potash last year, one of three critical elements for fertiliser blending. Nigeria imports approximately 40% of its raw materials; the remainder is supplied domestically, and local blended output was 1.5 million tonnes last year, virtually equal to domestic demand.
“The Canadian potash will hopefully arrive in time for the planting season, which begins as early as end-May in some areas,” FEPSAN executive director Gideon Negedu said, adding that the association has developed a strategy to prioritise crops that require additional potash.