Chemical and Organic Fertilizer Market in Relation To The

Chemical and organic fertilizer market in relation to the interests of small farmers in Myanmar July , 2015
Chemical and organic fertilizer market in relation to the

interests of small farmers in Myanmar
Food Security Working Group

July 2015
Food Security Working Group 1

July , 2015 Chemical and organic fertilizer market in relation to the interests of small farmers in Myanmar
Chemical and organic fertilizer market in relation to the interests of small farmers in
Myanmar
July 2015
The food security working group (FSWG) is a member-based network of non-government organiza-
tions, community based organizations and individuals addressing food insecurity in Myanmar, directly
engaging with members to build their knowledge and skills on food security and mobilizing the collec-
tive capacities of the network to identify and formulate issues for research, dialogue and policy advo-
cacy that will benefit the lives of vulnerable communities in Myanmar. The FSWG is a diverse network
encompassing a wide and varying range of skills, capacities and competencies and depth of knowledge
on issues relating to food security.
Food Security Working Group

114, Danatheikdi lane, Gandamar Street,
Kabaaye Pagoda Road, Ward 8,
Mayangone Township,Yangon 11061
Tel : +95 (9) 4250 26461~2
Website: www.fswgmyanmar.org
The research was carried out by Paul Roelofsen, Dr. Min Aung and Dr. Khin Hnin Yu with the
assistance of the field survey team of the FSWG member organizations: CESVI, GPI and Shwe
Danu (SwissAid). This research has been produced with financial assistance from Livelihoods and
Food Security Trust Fund (LIFT).
2 Food Security Working Group

Summary
A study on fertilizer and fertilizer markets was conducted from mid-January to mid-February 2015. The
objective of the study was to assess how fertilizer and the fertilizer markets are both negatively and
positively affecting the interests of small-scale farmers and the influence on food security in Myanmar.
The second objective was to give policy recommendation to the FSWG. These recommendations could
then be used to advocate for changes in policy in an effort to make the environment for smallholder
farmers more conducive and to contribute to preserving food security.
The supervising committee decided to include Pyapon, Pindaya and Magway Townships as represen-
tatives of the different agro ecological zones as presented in the table below.
Township Representing: Crops investigated:

Pyapon Delta & coastal areas Dry season rice
Rainy season rice with and without irrigation
Pindaya Hilly areas Corn
Potato
Cabbage
Magway Dry zone Sesame
Ground nut
Green gram
In Nay Pyi Taw, the Director General of the Department of Agriculture, the Director of Land Use Divi-
sion, the Director of Extension Division, the Director of Soil and Water Utilization Section of Depart-
ment of Agricultural Research, Pro-rector, Professor of Agricultural Economics Department and Pro-
fessor of Agricultural Chemistry Department from Yezin Agricultural University were all interviewed.
In Yangon, two persons from Myanmar Rice Federation (MRF), one person from Myanmar Fruit and
Vegetables Association and General managers from two Agrochemical companies were interviewed.
The farming business is becoming increasingly risky. Farmers without enough household labour are
facing higher labour costs and the markets for casual labour are getting tighter, driving the daily wages
of casual labour up. Declining soil fertility and increasing prices of fertilizer and pesticides increase the
investments that farmers need to make in order to obtain good crops from their land. As long as the
crop yield is reasonable, farmers don’t run into many problems. However, farmers run into problems
when their harvest fails and when inputs and labour obtained through credit cannot be paid back.
Some farmers also mentioned that farming risks also increase when the weather is not good, especial-
ly when there is not enough as there once was ten years ago.
The choice, farmer make on what type of fertilizer to use and how much is usually based on observa-
tions of farmers in their villages with neighbors, friends and family. Soil testing is typically done by fer-
tilizer traders in order to advise farmers and is only done sporadically. There is a need for rationalizing
fertilizer gifts (applications) based in soil analysis.
Soil is a precious production asset that needs maintenance. In Myanmar and in many other parts of
Food Security Working Group i

the world, soil maintenance and its involved costs are not considered. As a result, soils are becoming
increasingly exhausted, resulting in higher (chemical) fertilizer needs and increasing costs to achieve
the same yields as before. There is a need to invest in soil maintenance.
Farmers’ knowledge on fertilizer and fertilizer use is limited; there is a need for more farmer extension
and on-farm experimenting with fertilizer gifts.
There are rumors circulating among farmers and shop keeper in regards of mixing fertilizer. Many shop
keepers mentioned that re-bagging at the border of China is the point of mixing high and low quality
fertilizer. Although we cannot verify these rumors, it is important not to deny them either. There is a
need for quality testing of fertilizer at the point when farmers purchase fertilizer. Farmers need to be
protected against companies that deliver bad quality fertilizer.
Access to credit has definitely increased over the past three years, especially in the Ayarwaddy Delta.
The role of moneylenders has decreased while MADB, farmer associations and Micro Finance institu-
tions have stepped up – providing credit particularly in areas where farmers have access to irrigation.
In other areas –outside the Ayarwaddy Delta – the role of more informal credit providers such as
moneylenders, fertilizer shops, friends and family, shows that access to more formal credit is limited.
There is a need to increase access to credit in general, but particularly outside the Ayarwaddy Delta.
Because of the high costs for inputs and labour, it is likely that farmers are taking out loans from many
different sources and therefore have a high level of debt that they will not be able to repay. Research
and monitoring of indebtedness should go hand in hand with increased access to credit.
Weather is becoming increasingly influential to farmers, especially in combination with higher input
levels, pressure on sales prices and farmer indebtedness. This calls for improving farmer’s resilience
against bad and unreliable weather.
ii Food Security Working Group

Table of Contents
Summary......................................................................................................................................................................... i
1 Introduction...........................................................................................................................................................1
2 Methodology.........................................................................................................................................................2
3 Government regulatory policy...............................................................................................................................3
4 Farmers practice, knowledge and interest.............................................................................................................4
4.1 Delta and coastal areas................................................................................................................................. 4
4.1.1 Rice production in the rainy season without access to irrigation.........................................................4
4.1.2 Rice production in the rainy season with access to irrigation in the dry season..................................6
4.1.3 Dry season rice production..................................................................................................................7
4.1.4 Discussions on Ayeyarwady Delta........................................................................................................9
4.2 Upland areas............................................................................................................................................... 10
4.2.1 Corn.................................................................................................................................................... 11
4.2.2 Potato................................................................................................................................................. 12
4.2.3 Cabbage............................................................................................................................................. 14
4.2.4 Discussions on the upland areas........................................................................................................16
4.3 Dry zone...................................................................................................................................................... 17
4.3.1 Sesame............................................................................................................................................... 17
4.3.2 Ground nuts....................................................................................................................................... 19
4.3.3 Green grams....................................................................................................................................... 21
4.3.4 Discussions on the dry zone...............................................................................................................22
5 Fertilizer Markets.................................................................................................................................................23
5.1 Delta............................................................................................................................................................ 23
5.2 Upland........................................................................................................................................................ 23
5.3 Dry zone...................................................................................................................................................... 24
5.4 Market linkages and sales...........................................................................................................................24
6 Other observations..............................................................................................................................................25
6.1 Choosing fertilizer................................................................................................................................... 25
6.2 Fertilizer and yields over time in the Delta.............................................................................................25
6.3 Quality of fertilizer and fertilizer testing.................................................................................................26
6.4 Gender issues......................................................................................................................................... 26
7 Conclusions and recommendations.....................................................................................................................27
Food Security Working Group iii

iv Food Security Working Group

1 Introduction
The Food Security Working Group (FSWG), operating since 2002, is a forum for networking, capacity
building, policy advocacy, research, food security monitoring, and knowledge sharing for national and
international NGOs as well as individuals who are concerned with food security in Myanmar.
In October 2014 the FSWG launched a call for a study of fertilizer and fertilizer markets. The objectives
and activities were the following:
Objective 1:
To assess how fertilizer and the fertilizer markets are negatively and positively affecting the interests of
small-scale farmers and its influence on food security in Myanmar.
Objective 2:
To give policy recommendations.
Activities:
1 Assess farmers’ practices, knowledge and interests concerning the use of fertilizers for their crops
2 Map the fertilizer market in Myanmar
3 Assess government regulation policies and the enforcement of these policies
4 Examine marketing and sales schemes by fertilizer wholesalers and retailers to end-users
The recommendations generated by this research could then be used to lobby and advocate for
changes in policy to make the environment for small-holder farmers more conducive to contribute to
fighting against food insecurity.
In August 2014, IFDC (International Fertilizer Development Centre) started research on Fertilizer Sector
Improvement Project and Myanmar Fertilizer Policy Evaluation. The report was issued in January 2015
and therefore, the initial design of our research was adapted to complement the study of IFDC. The
IFDC study elaborated on the fertilizer market and policies, so it was decided to focus more on activity
1, 3 and 4. Where relevant, reference will still be made to market maps of fertilizer, especially organic
fertilizer.
Myanmar is an agricultural based economy with 25% of it GDP coming from agriculture and 70% of the
labour force finding employment in agriculture.
Chemical fertilizer plays an important role in increasing Myanmar’s agricultural production and
improving food security for millions of people. Fertilizer can also have a negative affect as over-use of
chemical fertilizer spoils ground water sources and increases eutrophication of lakes streams and
rivers. Inefficient use will increase production cost without leading to improved production. Where
fertilizer is purchased on credit (particularly unfavorable credit with high interest rates), farmer face
increased indebtedness.

2 Methodology
For this research, the supervising committee requested the researcher to visit Pyapon Township in
Ayarwaddy Delta, Pindaya Township in South Shan state and Magway Township in Magway division.
A mixture of methods were used for data collection; both quantitative (household survey with a
questionnaire) and qualitative (focus group discussions, direct observation and key informant inter-
views) methods.
In total, 720 households in 26 villages were interviewed in the household survey with a questionnaire.
In addition, 11 focus group discussions were conducted in 11 of those villages.
The village tracks were selected because a member organization of the FSWG had access to these
areas through their projects. The research committee assigned a number of crops to the research
team. The team prioritized village tracts with the availability of the assigned crops.
The villages were selected by using the probability-proportional to size (PPS) method. Households for
interviews were selected randomly with the following method: the first house was randomly selected
by using a turning pen. The next households were selected by using steps (for example 1 village has
216 households; so 18 interviews need to be conducted; thus every 12th house needed to be selected).
Selected households were households with access to land, either land they own themselves or land
they rent from other people, (if the selected household was landless, the house to the right would be
selected instead) In the household, the numerators interviewed the head of the household or spouse
that were well-informed regarding the family’s farm business.
The farmers who participated in the focus group discussions were usually senior farmers in the villages.
Focus group discussions with women were conducted as well.

3 Government regulatory policy

In the table below is an overview of the recent history on government policies regarding fertilizer
markets in Myanmar.
Table 1: Summary of fertilizer policy phases (Hnin Yu Lwin, Theingi Myint, Shwemar Than, Nay Myo Aung, Cho Cho San and Tin Htut)
Phase I 1962-1987: State control of agricultural marketing as well as the import and distribution of fertilizers. During this period the
agricultural sector remained stagnant and yields actually declined. Subsidized fertilizer pricing scheme.
Phase II 1987-2002: Period of transition from a state controlled to a liberalized fertilizer sector. Government objec-tives were to
commercialize agriculture and maintain food security; policy measures included: liberalization of rice trade,
allocation of fallow land to private investors (for agricultural purposes), and exemption of import tariffs on
agricultural inputs but no clarity about regulation on fertilizer import.
Phase III 2002-2013: Liberalized, private sector-based fertilizer program; no fertilizer subsidy. No import tariffs on agricultural inputs
and no involvement of SOEs in import and marketing of fertilizers (except distribution of small quantity of urea
from state-owned factories).
Below is a summary of the fertilizer law enacted in 2002.
Chapter Subject Particular

Chapter 1 and 2 Definitions and Objectives Definitions of 17 key terms in the law. The law mention 6 major objectives of
the law.
Chapter 3 and 4 Formation and functions of the fertilizer The main duties of the fertilizer committee are issuing policies, issuing
committee rejecting or suspension of registration certificates. The fertilizer committee
shall form a fertilizer technical body.
Chapter 5 Registration certificate Companies that would like to produce, import or export fertilizer need a
registration certificate which can be obtained from the fertilizer committee
Chapter 6 License Any company that is involved in mixing, repackaging or storing of fertilizer for
commercial purpose needs a business license that can be obtained from the
Myanma Agriculture Service (DoA).
Companies that like to sell or distribute fertilizer need to obtain a business
license from the state and division manager
Chapter 7 Assignment or duties of the inspector The inspector is responsible for checking the fertilizer against the labels
Chapter 8 Taking action by administrative means Suspension or cancellation of registration certificate or business licenses by
the issuing bodies.
Chapter 9 Appeals Stipulated what to do when business are not satisfied with the actions of
administrative means regarding registration certificate or business licenses.
Chapter 10 Prohibition It is prohibited to operate without registration certificate or business license

where relevant.
Chapter 11 Offence and penalties When offences happen against the prohibitions: it is stipulated that there can
be imprisonment or fines of 50,000 to 150,000 MMK
Chapter 12 Miscellaneous Arrangement regarding establishment of fees for registration and licenses.
Exceptions for fees is arranged.
In 2015, a revised fertilizer law was approved by the parliament.

The main purpose of the law is to regulate quality and reduce environmental risks. The law is doing this
through a registration and licensing system. The law itself works in the favor of farmers in the sense
that quality of fertilizer is crucial for smallholder farmers. The government currently does not have the
capacity to conduct regular checks on quality of fertilizer. The number of accredited laboratories is too
small to analyze a reasonable number of samples in order to be able to accept or reject bad quality
fertilizer and to catch companies that don’t adhere to the law. In other words; the enforcement of the
law with the current infrastructure is very challenging at the least.

4 Farmers practice, knowledge and interest

4.1 Delta and coastal areas
Farmers in the Ayeyarwady produce mainly 2 crops; rice and beans. Other crops are produced as well
but they are economically less important than rice and beans. Rice production can be divided in to dry
season rice (November-March) and rainy season rice (May/June-October/November).
The township of Pyapon is situated on the southeastern part of the Ayeyarwady Delta and by far the
major part of the economy is around rice production and its supplying and demanding industry.
Township Village tract Village # interviews Township Village track

Pyapon Lappan Chaung Phyar 20 Pyapon Lappan Group
Sa Pay 20
Oakabar Oakabar 20 Oakabar Group
Zin Baung West Hnetlalay 20 Zin Baung
Kyonetar Shan Kwin Kyone Pe 20 Kyonetar Shan Kwin
Kyone Tar 20
Shan Kwin 40
Thlate Chaung Thlate Kyi 12 Thlate Chaung
Thlate Kyi Thlate Chaung 28 Thlate Kyi
Thlate Too Myaung 40
total 240 total
Total
4.1.1 Rice production in the rainy season without access to irrigation

Rice production in the rainy season without access to irrigation means that farmers have no access to
irrigation in the dry season. Those farmers can only grow one rice crop per year.
In the rainy season when farmers have no access to irrigation in the dry season, the general practice in
the Delta is that farmers broad cast the seeds and in parallel maintain a small seedbed. The rice in the
seedbed is transplanted to areas where rice has problems germinating.
In the seedbed, a small amount of mainly urea is used. The general practice is that the vast majority of
farmers use chemical fertilizer.
Do you use chemical fertilizer

Yes 98.8%
No 1.3%
Most farmers apply fertilizer 3 times. The use of fertilizer three times indicates that farmers put a lot
of effort into producing rice during the rainy season as it is their most vital crop.
How many times do you apply chemical fertilizer

1 Times 100.0%
2 Times 100.0%
3 Times 91.1%
During the first application, about half of the farmers use one type of fertilizer while the other half use
a mixture of fertilizer.

Composition of fertilizer application 1st application 2nd application 3rd application

Only Urea 22.8% 49.4% 41.8%
Only T-super 26.6% 2.5% 2.5%
Mix Urea Compound 26.6% 26.6% 26.6%
Mix Urea T super 24.1% 21.5% 20.3%
Not apply 0.0% 0.0% 7.6%
All farmer use urea either only as urea or in a mix with compound or T-super. About 40% of the farmers
that use fertilizer use compound. Compound is only used in a mix with urea or t-super. T-super is used
by more than 50% of the farmers that use fertilizer. Reasons for choosing types of fertilizer are
discussed in section 6.1.
How much fertilizer do you use Usage* Amount (bags/acre)**

Urea 100.0% 1.04
Compound 40.5% 1.35
T-super 51.9% 1.07
Potash 0.0% 0.00
*of farmers that use chemical fertilizer
**one bag is 50kg
The only method farmers use to apply fertilizer is by broadcasting. No other methods are used.
How do you apply the fertilizer

Broadcasting 100.0%
Side dressing 0.0%
Direct placing 0.0%
In the rainy season, just under 75% of farmers with no access to irrigation needed to borrow money to
purchase chemical fertilizer.
To purchase fertilizer did you need to borrow money

Yes 73.4%
No 26.6%
Most farmers borrow money from the Myanmar Agricultural Development Bank (MADB) and second
most-used to borrow money is from moneylenders. During focus group discussions with women, it
was discovered that when they pay the loans back, they first pay it back to the MADB because if one
farmer in the village track is failing to repay, no farmers can borrow from the MADB during the next
season.
From whom did you borrow money

Friend/family 3.2%
Shop/fertilizer shop 1.6%
Money lender 27.4%
Myanmar Agricultural Development Bank 64.5%
Private company 3.2%
None of the farmers surveyed used organic fertilizer.
Do you use organic fertilizer

No 100.0%

In the past, almost all farmers used organic fertilizer. However, since around 1980, people started using
chemical fertilizer. Once chemical fertilizer became accessible, most farmers stopped using organic
fertilizer altogether because of practical reasons and because of a lack of availability. During focus
group discussions, farmers also mentioned that because many farmers sold cows and buffalos to
purchase machinery, less animals are in the area, meaning there is less cow dung available for use as
well.
4.1.2 Rice production in the rainy season with access to irrigation in the dry season
Rice production during the rainy season with access to irrigation means that farmer have access to
irrigation in the dry season but usually don’t use irrigation during the rainy season.
Rice production during the rainy season is different when farmers have access to irrigation.
Do you use chemical fertilizer on rainy season rice

Yes 70.6%
No 29.4%
Less farmers use chemical fertilizer during the rainy season when they have access to irrigation; only
70.6% as compared to 98% of farmers who don’t have access to irrigation. During focus group
discussions farmers explained that rice production during the rainy season is risky and they don’t like
to invest too much in rainy season rice because they have more reliable return on their investments in
the dry season.
Farmers apply chemical fertilizer only once or twice while only 3.5% of the farmers apply fertilizer 3
times.
How many times do you apply fertilizer

1 time 100.0%
2 times 46.0%
3 times 3.5%
The amount of fertilizer used is also lower when farmers have access to irrigation during the dry
season. Compound is hardly used during the rainy season when farmers have access to irrigation. The
amount of fertilizer farmers use when they have access to irrigation during the dry season is 37.2% less
than when farmers have no access to irrigation during the dry season.

Urea 99.1% 0.92
Compound 5.3% 0.57
T-super 59.3% 0.62
Potash 9.7% 0.43
**one bag is 50kg
Most farmers use only urea or urea in combination with t-super.
All farmers broadcast fertilizer and no other techniques are used.


Only Urea 53.1% 36.3% 2.7%
Only compound 0.9% 0.9% 0.0%
Only T super 0.9% 0.0% 0.0%
Mix urea/compound 0.9% 1.8% 0.9%
Mix Urea/T super 39.8% 3.5% 0.0%
Mix Urea/Potash 4.4% 1.8% 0.0%
Mix T super/Potash 0.0% 1.8% 0.0%
Not apply 0.0% 54.0% 96.5%
Almost all farmers need to borrow to purchase chemical fertilizer.

Yes 99.1%
No 0.9%
From whom did you need to borrow to purchase fertilizer

Friends and Family 0.9%
Money lender 8.9%
Micro finance Institution 3.6%
Farmer association/cooperative 44.6%
The farmers borrow mostly from farmer associations/cooperation and this is very different from
farmers that have no access to irrigation, who don’t have the option of borrowing from farmer
associations/cooperation at all. For farmers with access to irrigation, MADB is the second most import-
ant option. Most farmers, however, borrow from different sources because the MADB only provides a
loan of 100.000 MMK ($100) per acre while the production costs vary between 150.000 MMK ($150)
and 250.000 MMK ($250). In many cases, farmers need to borrow the additional amount from other
sources. They first approach the MADB because of low interest rates (0.6% per months), while other
credit providers offer options between 2-4% per month.
When farmers have access to irrigation during the dry season they also don’t use organic fertilizer. The
reasons for not using organic fertilizer are similar as explained in chapter 4.1.1.

No 100.0%
4.1.3 Dry season rice production

All farmers that have land that is irrigatable use chemical fertilizer in the dry season.
Do you use chemical fertilizer on dry season rice

Yes 100.0%
No 0.0%
They mostly apply chemical fertilizer 3 times during the growing season.


1 time 100.0%
2 times 98.8%
3 times 89.4%
Almost all farmers use urea at a rate of 2.37 bags per acre and t-super at a rate of almost 1 bag per
acre. The level of fertilizer use in the dry season is 72.5% higher than in the rainy season when farmers
have no access to irrigation and 174.4% higher in the rainy season when farmer have access to irrigation.

Urea 98.1% 2.37
Compound 21.9% 1.09
T-super 95.0% 0.95
Potash 43.8% 0.54
**one bag is 50kg
The investments during dry season rice are the highest because of the return on investment is the
highest and most reliable. The risk of unreliable weather is lower than the rainy season and the pressure
of pests is usually lower as well.

Only Urea 26.3% 51.9% 70.6%
Mix Urea/T super 46.3% 22.5% 1.9%
Mix Urea/Potash 8.1% 13.1% 11.3%
Mix T super/Potash 0.0% 0.6% 0.0%
Mix T super/compound 0.0% 0.6% 0.0%
Mix compound/potash 0.0% 0.0% 0.6%
Not apply 0.0% 1.3% 10.6%
During the first application, the use of mixtures of fertilizer is high and decreasing in the second and
third application.
All farmers broadcast the fertilizer.

Yes 99.4%
No 0.6%
Almost all farmers borrowed money to purchase fertilizer.

Friends and Family 0.6%
Money lender 8.2%
Micro finance Institution 0.6%
Borrowing from fertilizer shops is much higher than in the rainy season (16.4% as compared to 5.4%).
Perhaps this is the case because the level of investment is higher during the dry season and the MADB

and farmer association don’t cover enough of the investment; so the third option of the fertilizer shop
is added as an option for credit.

No 100.0%
None of the farmers interviewed used organic fertilizer.
4.1.4 Discussions on Ayeyarwady Delta

The tables below show an overview of the biggest constraints in crop production, first for farmers with
access to irrigation and second, for farmers without access to irrigation.
Note that household labour is usually labour within the nuclear family (meaning a spouse or child
above 18 years). Casual labour is hired labour outside the family nucleus. Labour shortage has increase
over the past years. In 2011 only 8.6% mentioned labour shortage or lack of household labour as an
issue, whereas in 2015, 51.3% mentioned labour shortage of lack of household labour as an issue.
Over the years, farmers have reduced labour cost (especially hired labour) to be able to purchase
enough farmer inputs (seeds, fertilizer, pesticides). Transplanting seedlings was more commonly prac-
ticed in the past. A survey in the Delta showed that in 2011, 73.3% of the farmers still transplanted
seedlings, while in 2014, it was reduced to 41.4% of the farmers, which is a decrease of 43.6% in 3
years.
Biggest constrain in crop production (access to irrigation) 1st constrain 2nd constrain 3rd constrain 4th constrain 5th constrain total
lack of money to buy the necessary inputs (or lack of credit) 71.9% 14.4% 3.8% 3.1% 0.6% 93.8%
lack of draught power/mechanical power (or too expensive) 3.8% 10.0% 13.8% 14.4% 6.3% 48.1%
lack of fertilizer (or too expensive) 0.6% 2.5% 0.6% 1.3% 3.1% 8.1%
lack of household labour 6.9% 35.0% 24.4% 3.1% 4.4% 73.8%
lack of casual labour available locally (or too expensive) 3.1% 1.9% 5.6% 4.4% 1.3% 16.3%
low prices for the agricultural crops grown 11.9% 27.5% 21.3% 15.6% 1.9% 78.1%
bad/unreliable weather (including too little or too much rain) 0.6% 3.8% 11.3% 18.1% 10.0% 43.8%
lack of water resources or irrigation infrastructure 0.6% 1.3% 8.1% 3.1% 5.0% 18.1%
crop pests and disease 0.0% 0.0% 7.5% 12.5% 23.1% 43.1%
low soil fertility/poor soil structure etc 0.6% 0.0% 0.6% 6.9% 5.0% 13.1%
The biggest constraint, both for farmers with and those without irrigation, is very obviously a lack of
money to buy the necessary inputs or a general lack of credit. Thus, even though access to credit from
more formal institutions like MADB, farmer associations and MFIs has improved, many farmers still
perceive that the price of inputs is high and the access to credit is not enough.
The second and third main constraint is different compared to farmers with irrigation (lack of house-
hold labour and low prices for crops) to farmers without irrigation (bad/unreliable weather, lack of
fertilizer).
Biggest constrain in crop production (no access to irrigation) 1st constrain 2nd constrain 3rd constrain 4th constrain 5th constrain total
lack of other tools and equipment (or too expensive) 11.3% 7.5% 1.3% 1.3% 0.0% 21.3%
lack of seeds (or too expensive) 3.8% 7.5% 3.8% 5.0% 2.5% 22.5%
salinity 1.3% 2.5% 0.0% 8.8% 12.5% 25.0%
soil acidity 0.0% 1.3% 3.8% 3.8% 15.0% 23.8%

It is obvious that in the Delta, a lack of labour-both household or casual labour –as well as a lack of
draft power are big issues. During focus group discussions, farmers mentioned that cost for labour is
an increasing burden for them. When farmers have no access to irrigation, the unreliable weather is
becoming a dominant issue, which makes farming more risky.
For farmers that have access to irrigation, it was especially mentioned that sales prices of their pro-
duce is too low.
Other issues that were mentioned by farmers as a constraint in crop production were pests and soil
problems like salinity, acidity and declining soil fertility.
The team observed that farmers’ knowledge regarding fertilizer and fertilizer use in general, is limited.
Farmers mentioned that the way they determine what type and how much fertilizer they use mainly
depends on what they see around them in the village. They look at what other farmers are using or
what they were doing in the past season. In several villages, we met people that referred to an old
farmer who tried something new and then they all followed suit. Nobody we talked to knew about soil
testing. We heard of one fertilizer company or trader (it was not completely clear) that had done some
soil testing and used that to advise some farmers. However, big majority have never used soil data to
adapt amounts of fertilizer applied.
In line with this observation, it was no surprise that none of the farmers appeared to strategically build
up the fertility of their soils. No knowledge seems to exist regarding the longer-term effects of phos-
phorous applications or on the effects of enhanced nitrogen contents in crop residues regarding the
formation and quality of soil organic matter. Therefore, no insights exist as to possible accumulations
of minerals, possible unnecessary gaseous losses or regarding best ways to optimize fertilizer doses
and combinations per year and per season.
Some other observations were regarding access to credit.
Formal (total) 70.6%

Informal (total) 21.7%
Formal+informal 7.7%
About 78% of farmers in the Delta have access to formal institutions for credit. In another area in the
Delta (Labutta), the access to more formal credit increased by 268.3%.
4.2 Upland areas

Pindaya Township was selected to conduct the research in the hilly areas. Eight villages were selected
for the interviews with the questionnaire and 4 villages were selected for the focus group discussions.
In Pindaya township there are about 80,000 people who are mainly Danu and Shan in ethnicity.
Township Village track Village # interviews

Pindaya Koo Kaw Chote Chat 20
Kone Thar 20
Kyar Kone Kyar Kone* 40
Mine Le Mine In* 40
Myae Char (N) Pane Nae Pin 20
PhaunTaw 20
Pyawe Hla Sakyar Kone* 40
Thaung Shae Tha Pyae Kone* 40
Total 240
*Focus group discussions were conducted in this village

In Pindaya Township, 240 households were selected with access to land for interviews. Of the house-
holds interviewed, 37.1% grew corn, 64.2% grew potatoes and 27.4% grew cabbage. The majority
(83.5%) of farmers that grow cabbage grow potatoes as well. Other combinations are less common.
4.2.1 Corn
Do you grow corn

Yes 37.1%
No 62.9%
During the interviews 240 households were selected with access to land and of all those households
(37.1%) did grow corn that is mainly for export to China.
Of all households that grow corn, 97.8% uses chemical fertilizer.

Yes 97.8%
No 2.2%
Usage* Amount (bags/acre)**

Urea 82.8% 1.1
Compound 83.9% 1.2
T-super 6.9% 1.6
Potash 0.0%
**one bag is 50kg
The most commonly used chemical fertilizers are urea and compound. For corn, farmers use a bit more
than one bag of 50kg per acre.
Usually, farmers that grow corn apply chemical fertilizer 1 or 2 times. Hardly anybody applies chemical
fertilizer more than 3 times in one growing season.

Only Urea 11.5% 32.2% 1.1%
Only T-super 2.3% 0.0% 0.0%
Not apply 0.0% 46.0% 97.7%
During the first application, chemical fertilizer compound is the most commonly used fertilizer and
second most used is a mix of urea and compound. During the second application, compound is hardly
used as a single application and instead, most farmers use urea or a mixture of urea and compound.

Broadcasting 0.0%
Side dressing 32.2%
Direct placing 67.8%
The method farmers are using mostly is direct placing followed by side dressing. Nobody applies
fertilizer by means of broadcast chemical fertilizer. This probably has to do with small plots in general
compared with rice production.

To purchase fertilizer, almost 65% of the farmers purchase chemical fertilizer on credit, while only
35.6% pay the fertilizer directly from the pocket. This is quite different than in rice production, where
almost everybody purchases fertilizer on credit.

Borrowed 43.7%
Partly borrowed 20.7%
Not borrowed 35.6%
The most popular entity farmers borrow from to purchase fertilizer is the fertilizer shop itself. The sec-
ond option people take is the MADB or a moneylender. The funds from the MADB usually come late,
which is not very useful for the farmers and the moneylenders charge high interest rates.

Friends/family 5.5%
Shop 58.2%
Money lender 12.7%
Micro finance institution 9.1%
MADB (government) 14.5%
For corn, 46.1%, use organic fertilizer. This means that close to half of the farmers use chemical and
organic fertilizer.

Yes 46.1%
No 53.9%
All farmers interviewed either by household survey or focus group discussions used cow dung as
organic fertilizer.
What type of organic fertilizer do you use bags

Cow dung 100.0% 61.7
4.2.2 Potato
Of all the farmers interviewed in Shan (Pindaya Township), which have access to land, almost 65%
grow potatoes.
Do you grow potatoes

Yes 64.2%
No 35.8%
Of all farmers that grow potatoes, 100% use chemical fertilizer.

Yes 100.0%
No 0.0%
Most farmers (82.5%) use compound at a rate of 6.4 bags per acre, which is high. Urea is used by 61%
of farmers at a rate of 1.6 bags per acre and T-super is used by 37% of the farmers at a rate of 4.2 bags
per acre. Potatoes use lots of fertilizer and is a rather capital intensive compared with rice farming.


Urea 61.0% 1.6
Compound 82.5% 6.4
T-super 37.0% 4.2
Potash 0.8% 1.5
**one bag is 50kg
Most farmers apply fertilizer 1 or 2 times. Hardly anybody (1.3%) applies fertilizer 3 times. The most
popular application method is to use a mixture of urea and compound followed by compound only.
About 12% of the farmers use a mixture of urea, compound and t-super.

Only Urea 1.3%
Only compound 24.0% 8.4%
Only T-super 9.1% 2.6% 0.6%
Mix Urea/T super 7.1% 0.6%
Mix T super/compound 9.1% 7.1%
Mix urea/compound/t-super 11.7% 6.5%
Mix compound/t-super/potash 0.6% 0.6%
Not apply 61.7% 98.7%
Most farmers use side dressing as way to apply fertilizer and 13.6% use direct placing.

Broadcasting 0.6%
Side dressing 85.7%
About 90% of the farmers purchase fertilizer for potatoes on credit or borrow the money; however
68.2% used their own money as well to pay part of the fertilizer.

Borrowed 21.4%
Not borrowed 10.4%
Like with corn in the hilly areas, farmers obtain most of the credit facilities from the shop they obtain
the fertilizer from. About 27% of the farmers obtain money from micro finance institutions, which is
much higher that with corn. The moneylender and the MADB are used much less as a means of
borrowing money for potatoes than for corn.

Friends/family 2.1%
Shop 60.3%
Money lender 2.1%
Village savings & loans association 0.7%
Private company 0.7%

All farmers apply organic fertilizer. In focus group discussion farmers mentioned that they consider
organic fertilizer more important for potato growing than chemical fertilizer.

Yes 100.0%
No 0.0%
All farmers use cow dung as organic fertilizer. During the focus group discussions farmers stated that it
is very important that the cow dung is well composted otherwise the leaves of the potato plant will
become yellow.

Cow dung 100.0% 169.2
All farmers apply compost only one time.

1 time 100.0%
2 times 0.0%
3 times 0.0%
4.2.3 Cabbage
Of all households interviewed in Shan that have access to land, 27.9% grow cabbage.
Do you grow cabbage

Yes 27.9%
No 72.1%
All of the cabbage farmers use chemical fertilizer.

Yes 100.0%
No 0.0%
The use of compound is highest with 86.6% of the farmers using it at 6.6 bags per acre. The use of urea
is also very common as 74.6% use urea at a rate of 2 bags per acre. T-super is less commonly used as
28.4% of the farmers use it at a rate of 3.4 bags per acre.

Urea 74.6% 2.0
Compound 86.6% 6.6
T-super 28.4% 3.4
Potash 0.0%
**one bag is 50kg
When farmers grow cabbage, they usually apply chemical fertilizer 3 times. Most commonly is to use
a mixture of urea and compound. The use of compound only is also common among cabbage farmers.


Only Urea 1.5% 1.5% 1.5%
Only compound 29.9% 22.4% 19.4%
Only T-super 1.5% 3.0% 3.0%
Mix Urea/T super 13.4% 10.4% 9.0%
Mix urea/compound/t-super 7.5% 7.5% 7.5%
Not apply 13.4%
Usually farmers use direct placement of fertilizer as major technique.

Broadcasting 3.0%
Side dressing 13.4%
About 90% of the farmers need to take a loan to purchase fertilizer, however, close to 80% also
contribute their own resources to purchase chemical fertilizer.

Borrowed 10.4%
Not borrowed 10.4%
Farmers usually borrow from the fertilizer shop, obtaining the fertilizer on credit from the shop and
paying it back after the harvest. Micro finance institutions are also an important source to borrow from
to pay for fertilizer. MADB provides loans for 17.7% of the respondents that purchased chemical
fertilizer.

Shop 58.1%
Money lender 1.6%
Nearly all farmers that grow cabbage use organic fertilizer.

Yes 98.5%
No 1.5%
All farmers that use organic fertilizer use cow dung that is composted at a rate of 150 bags per acre.

Cow dung 100.0% 152.2
Organic fertilizer is only applied once by farmers that use organic fertilizer.


1 time 100.0%
2 times 0.0%
3 times 0.0%
4.2.4 Discussions on the upland areas

Although the situation in the upland areas is very different, the main constrains in crop production are
similar to other geographical areas.
What is your biggest constrain in crop production 1st constrain 2nd constrain 3rd constrain 4th constrain 5th constrain total
lack of water resources or irrigation infrastructure 0.4% 1.3% 9.2% 5.0% 2.9% 18.8%
Many farmers mentioned that a lack of access to credit in combination with high input and prices of
input is a major constrain. A lack of household labour and a lack of casual labour/price of casual labour
are big issues as well.
Unreliable or bad weather is a major constrain in crop production. Crop diseases were frequently
mentioned, and in many cases, people referred to the changes in weather as a cause of more problems
with pests.
Issues with soil, however, were not mentioned. This is probably because the soil that people use is
newer because of the land in the hilly area that was recently taken into production. Second, farmers in
the hilly areas use much more organic fertilizer than in the Delta. Most likely the organic matter in
those soils is higher than in the Delta.

About 32% of the farmers in the hilly areas have access to formal credit institutions. The access to
formal credit is much lower in the hilly areas than in the Delta, however. A major reason is probably
that most credit providers focus on rice production, which is the major crop in the Delta.

4.3 Dry zone

Magway was selected to conduct the research for the dry zone. In 8 villages, 240 households were
interviewed and focus group discussions were conducted in 4 villages. The main crops, according to
the research committee and the DoA of Magway, were sesame, ground nuts and green grams.
Township Village track Village # interviews

Magway Ma Gyi Kan Pu Htoe San* 20
Nat Kan Nat Kan* 20
Nyaung Kyat San Nyaung Kyat San* 39
Nyaung Pin Ywar Kone Gyi 40
Tha Pauk Taw Tha Pauk Taw* 40
Tha Pyae San Min Ywar(S) 20
Tha Yet Lay Pin Kyar Pyit Inn 21
Kyaung Pyauk 40
Total 240
*Focus group discussions were conducted in this village
Of all households interviewed, 99.6% were producing sesame, 67.1% grew ground nuts and 34.2%
grew green grams. About 20% of all the households interviewed grew all crops.
4.3.1 Sesame
The interviewed farmers in the dry zone were almost all producing sesame.
Do you grow sesame

Yes 99.6%
No 0.4%
All farmers that grow sesame also use chemical fertilizer.

Yes 100.0%
No 0.0%
Almost all farmers use urea and compound. T-super and potash are hardly used.

Urea 94.6% 0.8
Compound 95.8% 1.2
T-super 4.6% 0.8
Potash 1.7% 0.8
**one bag is 50kg
With sesame, different combinations of chemical fertilizer are used. The most common combination is
urea mixed with compound. Almost half of the farmers use this during the first application and 42.3%
during the second application. Only about 25% are applying fertilizer 3 times. During the first
application, 38.1% of the farmers use only compound and during the second application 41% use only
urea. Farmers that use a third application mostly use only urea.

Composition of fertilizer application 1st application

2nd application 3rd application
Only Urea 2.5% 41.0% 14.6%
Only T-super 0.4%
Only Potash
Only Gypsium 0.4%
Mix T super/compound 0.4% 1.3%
Mix Urea/Gypsum 0.4% 1.3%
Mix compound/gypsum 2.9% 1.7%
Mix Compound/t super/Gypsum 0.4%
Mix Urea/compound/gypsum 2.9% 2.5%
Mix Urea/compound/potash/gypsum 1.3% 0.8%
Mix Urea/compound/t-super/gypsum 0.8%
Mix Urea/compound/t-super/potash/gypsum 0.4% 0.4%
Not apply 0.0% 2.1% 73.2%
Farmers use only broadcasting to apply the chemical fertilizer.

Broadcasting 100.0%
Side dressing 0.0%
Direct placing 0.0%
Almost 80% of the farmers borrow all the money they use to purchase chemical fertilizer. Only 2.5%
partly borrow and partly pay themselves and 17.6% purchase all the chemical fertilizer themselves.

Borrowed 79.9%
Not borrowed 17.6%
When farmers borrow to purchase fertilizer, they mostly borrow from the money lenders. Second and
third most popular to borrow from are family, friends and shops. Sources that are much less used are
MADB, MFI, village saving and loan associations or farmer associations/cooperatives.

Friends/family 22.7%
Shop 21.1%
Money lender 35.1%
Most farmers use organic fertilizer to grow sesame and only 13% do not use organic fertilizer.

Yes 87.0%
No 13.0%
Farmers that use organic fertilizer use cow dung. Farmers use it at a rate of nearly 75 bags per acre.


Cow dung 100.0% 74.7
Almost all farmers apply organic fertilizer at least once.

1 time 99.5%
2 times 0.5%
3 times 0.0%
4.3.2 Ground nuts

Of all farmers interviewed in the dry zone, 67.1% are growing ground nuts in the dry zone.
Do you grow groundnuts

Yes 67.1%
No 32.9%
All farmers that grow ground nuts use chemical fertilizer.

Yes 100.0%
No 0.0%

Urea 30.4% 0.9
Compound 96.3% 1.2
T-super 1.9% 1.2
Potash 1.9% 0.3
**one bag is 50kg
Almost all farmers use compound and about 30% use urea.T-super and potash are hardly used at all.
Most farmers apply chemical fertilizer 2 times. During the first application they mostly use compound
(44.7% of the farmers) or a combination compound and gypsum or a combination of urea, compound
and gypsum. For the second application, farmers mostly use Gypsum or a combination of compound
and gypsum. Applications of only urea or compound are used as well.

Only Urea 16.1% 1.2%
Only T-super 0.6%
Only Potash
Only Gypsium 1.9% 26.7% 5.0%
Mix urea/compound 10.6% 5.6%
Mix T super/compound 0.6%
Mix Urea/Gypsum 0.6% 0.6% 0.6%
Mix compound/gypsum 26.7% 18.0% 1.9%
Mix Compound/potash/Gypsum 1.2%
Mix Compound/t super/Gypsum 0.6% 0.6%
Mix Urea/compound/gypsum 13.0% 2.5% 0.6%
Not apply 16.1% 89.4%

Almost all farmers broadcast the chemical fertilizer.

Broadcasting 99.4%
Side dressing 0.6%
Direct placing 0.0%
About 55% of the farmers obtain chemical fertilizer on loan, while almost all remaining farmers pur-
chase fertilizer directly from their own pocket.

Borrowed 55.3%
Not borrowed 44.1%
Most farmers that obtain chemical fertilizer for growing groundnut on loan borrow from the money
lender or from friends and family. Much less borrow from the fertilizer shop, MFIs or village saving and
loan associations.

Shop 11.1%
Money lender 48.9%
A little more than 20% of the farmers that grow groundnuts use organic fertilizer.

Yes 21.1%
No 78.9%
Farmers that use organic fertilizer use mostly cow dung, but 8.8% of the farmers use EM humus and
2.9% use EM liquid.

Cow dung 88.2% 64.1
EM liquid 2.9% 2000 cc
EM Humus 8.8% 14.7
Almost all farmers apply organic fertilizer only once.

1 time 97.1%
2 times 2.9%
3 times 0.0%

4.3.3 Green grams

From all farmers interviewed in the dry zone, about 35% grow green grams.
Do you grow green grams

Yes 34.2%
No 65.8%
All farmers that grow green grams use chemical fertilizer.

Yes 100.0%
No 0.0%
Most farmers (92.7%) use compound to grow green grams. Many farmers (67.1%) use urea to grow
green grams. Only very few farmers use t-super or potash. Chemical fertilizer is used at a relatively low
rate at around 0.7 bags of urea and 0.9 bag for compound.

Urea 67.1% 0.7
Compound 92.7% 0.9
T-super 2.4% 1.0
Potash 6.1% 1.0
**one bag is 50kg
Most farmers use chemical fertilizer in two applications and about 14.6% apply chemical fertilizer 3
times.
During the first application they use compound or a combination of urea and compound and some
farmers use only urea. During the second application most farmers use urea followed by a mix of urea
and compound. When farmers use a 3rd application they use mostly urea.

Only Urea 7.3% 35.4% 11.0%
Only compound 50.0% 6.1%
Only T-super 1.2%
Only Litosine 1.2%
Only Kya Mat 1.2%
Mix urea/compound 35.4% 11.0%
Mix Urea/T super 1.2% 1.2%
Mix Urea/litosine 1.2% 1.2%
Mix Urea/Kya Mat 1.2%
Mix Urea/Bio Dine 1.2%
Mix compound/gypsum 1.2%
Mix Urea/compound/gypsum 3.7%
Not apply 42.7% 85.4%
All farmers use broadcasting when they apply chemical fertilizer.

Broadcasting 100.0%
Side dressing 0.0%
Direct placing 0.0%

Half of the farmers that grow green grams purchase fertilizer themselves while the other half buy it
fully on credit.

Borrowed 46.3%
Not borrowed 50.0%
Most farmers borrowed from moneylenders, the second most utilized source was fertilizer shops and
third was family and friends. Other sources were much less significant.

Shop 20.0%
Money lender 42.5%
Hardly anybody used organic fertilizer to grow green grams, so it was not possible to measure how
much fertilizer they used. All respondents that mentioned they use organic fertilizer used composted
cow dung.

Yes 1.2%
No 98.8%
4.3.4 Discussions on the dry zone

Although the issues are similar as in other agro-ecological areas in Myanmar one commonality is bad
or unreliable weather in the dry zone.
What are your biggest constrains in crop production 1st constrain 2nd constrain 3rd constrain 4th constrain 5th constrain total
lack of knowledge, skills or experience 0.0% 1.3% 0.8% 2.5% 8.8% 13.3%
Lack of access to credit and prices of inputs like fertilizer are mentioned over and over again. As in the
other agro-ecological zones, household labour and lack of casual labour are mentioned as well. Low
sales prices of produce are mentioned as important constrains in crop production. In the dry zone,
farmers also mentioned that diseases are a problem. In focus group discussions it became clear that
farming in the dry zone comes with high risks, mainly due to the combination of high inputs, inputs
purchased on credit and unreliable weather makes farming a risky business.


About 20% of the farmers in the dry zone have access to formal credit institutions. This is rather low
and even lower than the hilly areas that are believed to be low in access to formal credit.
5 Fertilizer Markets
5.1 Delta
In the Delta, farmers purchase fertilizer directly from the shop and most shops function only as sales
shop for fertilizer and usually don’t sell fertilizer on credit. Shops that allow customer to purchase on
credit are usually the newer shops that want to expand their market share. The more established
shops don’t give any credit. Fertilizer shops usually have between 4-6 different types of fertilizers and
each type of fertilizer many different brands. We could only identify 1 type of Gypsum, while for other
types there are usually about 8 but we found one shop having 17 different types of compound. Typical
combinations are fertilizer and pesticides, however, we also met shops that sell construction material,
petrol and other combinations as well. The retail shops in the Delta purchase all their fertilizer from
Yangon, and usually they have 1 to 3 suppliers (they have different suppliers for different items). The
market in the Delta looks free base on this research farmers are free to purchase whatever type of
fertilizer they want as long as they can pay for it. The research did not find any evidence that farmers
are they were tricked into schemes where they are led to believe that they need to sell harvest against
prices way below market prices. When farmers have the resources they can also buy what they need,
no evidence was found that farmers need to buy products they don’t want in order to get what they
want. Increase in access to credit and more fertilizer shops in the market in the Delta might have given
shops less options to misuse power on farmers.
In villages that are accessible by boat, fertilizer was more expensive because of transportation cost.
5.2 Upland
In the upland areas, the role of fertilizer shops is different compared with the Delta. Besides selling
fertilizer, the shops are major providers of credit. Access to formal credit is much more limited than in
the Delta area. The fertilizer shops obtain fertilizer from whole sellers in Mandalay or Yangon. The
number of shops selling fertilizer has increased a lot over the past 1-2 years. Farmers have more
options to choose from. Shops that sell poor quality fertilizer can stay open for one to two years before
they lose the farmers trust and go out of business. Quality control by the government is hardly existent.
Almost all shop owners interviewed mentioned how the repacking of fertilizer at the border allows for
the re-packers to mix low and high quality of fertilizer. In combination with the low capacity of the
government to perform quality control at the border increases the risks that farmers purchase fake of
very low quality fertilizer.
Although the number of fertilizer shops has increased, the sales of fertilizer per shop did not decrease.
This is because farmers are much more free to produce what they want which increased the demand
for fertilizer. The market in the uplands seem to be dominated by personal relationships between
farmer and shops and a sense of trust seem to be very important.
The market seems to be free farmers purchase what they prefer and can afford. However a report from
the land core group indicted that brokers in the corn sector specially targeted very vulnerable house-
holds with inputs (usually seeds and fertilizer) in combination with contracts where they could never
fulfill the requirements and ultimately lose their land. The fact that shops are providing credit linked to

the sales of fertilizer creates room for misuse of this extra facility. Because a part of the market is
dominated by personal relationships, abuse is difficult. Because personal relationships are now of less
importance, room for abuse of small farmers is more likely.
5.3 Dry zone

In the dry zone, like in the uplands, retail shops purchase the fertilizer from Mandalay or Yangon
(depending on the item).
Like in the uplands, all shops sell fertilizer on credit. This has also to do with the lack of access to formal
credit.
In the dry zone, we heard from companies that approached farmers with low priced fertilizer (low
quality) and farmers had difficulties repaying anything purchased on credit because the effect of the
so-called fertilizer was not noticeable. Farmers in the dry zone prefer to purchase fertilizer from
people/shops they know.
Especially during the rainy season, which is the peak of fertilizer sales, many entities that are not rec-
ognized by the government sell fertilizer illegally. Because they are not registered by the government
they are also out of the control system of the government, which is already weak in itself. This will put
smallholder farmers at more of a risk of purchasing false/fake fertilizer.
5.4 Market linkages and sales

The wholesale shops in Yangon sell most of the fertilizer on credit, especially if there is already a
long-standing relationship between the farmer and the seller. New customers usually need to pay di-
rectly out of the pocket. When retailers sell their product, they pay back what they have purchased on
credit.
Several wholesalers in Yangon have confirmed that they have teams including extension workers and
sales people in priority areas. In many areas, wholesalers have agents that sell fertilizer for them, how-
ever, in some areas the network of agents is weak and they send their own teams until they can build
up a strong network of agents.
In the table below is the overview of fertilizer markets from abroad to Yangon.
(from: D. Ian Gregory, Agribusiness Consultant, IFDC, U Tin Maung Shwe, Executive Officer, ARDC, Na-
ing Oo, Consultant, ARDC)

The retail shops usually don’t make any effort to extend knowledge to farmers. Some wholesale shops
in Yangon have extension teams in places where their agents are weak; so they use extension services
to farmers to penetrate the markets.
6 Other observations
6.1 Choosing fertilizer
The choice of farmers on what kind of fertilizer they choose depends on a number of factors. Not every
factor is of the same importance.
Important Medium Low

farmers look around in their villages and copy what other farmers are doing √
farmers look around in the villages and copy what works well with peer farmers √
practice what was done in the season before √
farmers getting advice from fertilizer companies √
farmers getting advice from DoA √
Based on advice from NGOs √
farmers look at the available budget √
During focus group discussion, farmers indicted that these are the main factors for them on how they
chose the type of fertilizer, how much they apply and in some cases even how many times they apply
fertilizer.
6.2 Fertilizer and yields over time in the Delta

Sometime during the mid-80’s and in some areas in the early 90’s, farmers started using chemical
fertilizer. Before that time farmers either used no fertilizer at all or used organic fertilizer. The organic
fertilizer was made of cow dung in combination with rice straw. Farmers found it difficult to remember
how much they actually used per acre.
Yields and fertilizer gift over time

120
100
80
60
40
20
0
1980 1985 1990 1995 2000 2005 2010 2015
Yield (baskets/acre) Fertilizer gift (Kg/acre)
During the time when farmers used only organic fertilizer, the yields were going down. Farmers
mentioned that it was more difficult to get enough organic fertilizer, particularly because they had

fewer animals when machines replaced these. It was also due to the fact that they had expanded their
land and so the amount of organic fertilizer per acre became less and yields started declining.
Initially when farmers started using chemical fertilizer, the yields improved nicely. Later, farmers
needed to use more and more fertilizer per acre.
This is a typical trend in tropical and subtropical regions where fertilizer applications are done sub-
optimally. Reasons for the decline in yields differ per soil type and climate. The loss of soil organic
matter often constitutes one of the most immediate factors, resulting in, o.a.: slaking, increased effects
of mineral leaching and erosion and exhaustion of minerals not included in the fertilizers.
6.3 Quality of fertilizer and fertilizer testing

This research did not assess fertilizer quality but there are still strong rumors about bad quality
fertilizer. The capacity to test fertilizer is limited as only 2 laboratories are certified to test fertilizer. As
testing of the quality of the fertilizer is limited, the chances that poor quality fertilizer is reaching the
farmers is high.
6.4 Gender issues

During focus group discussions with women, the role of men and women in agriculture were discussed
and specifically in relation to fertilizer. Women stated that they have nothing to do with fertilizer; they
don’t make the choices in relation to what type of fertilizer nor are they involved in technical issues of
fertilizer like how much fertilizer is used per acre. When it comes to the financing side of fertilizer, the
situation is much different because most fertilizer is purchased on credit and women have a say when
it comes to the choice of what moneylender to borrow from and how much to borrow. Women stated
that husbands and wives make the choices together and typically agree. Rarely do men and women
disagree when it comes to these matters. Women are the one’s who physically go to borrow the mon-
ey.
Especially in the Delta area farmers are changing their practices to reduce labour cost. The farmers
that are applying transplanting have reduced by 43% over 3 years. Women usually do the transplanting
so reducing the use of transplanting could have a negative influence on household income as well as a
negative impact on women empowerment.

7 Conclusions and recommendations

Next to labour costs, purchasing fertilizer is the second biggest cost that farmers usually make for crop
production. Most of the farmers purchase fertilizer on credit from various sources. The fact that farm-
ers are willing to take out loans in order to purchase fertilizer shows that having chemical fertilizer is
very important to them.
Farming business is becoming increasingly more risky. Farmers face higher labour costs because the
markets for casual labour is becoming more restricted, driving the daily wages of casual labour up.
Declining soil fertility and increasing prices of fertilizer and pesticides increase the investments that
farmers need to obtain a good crop yield. As long as the crop yield is reasonable, farmers don’t run into
too many problems besides the weather, especially since the rainfall is increasingly more irregular.
Farmers run into problems when harvests fail and the inputs and labour obtained through credit can-
not be paid back.
Farmer’s knowledge on how to use fertilizer is limited; especially when it comes to strategic fertilizer
application and mineral balances in the soil.
As markets have become more liberal, more fertilizer shops have opened, creating more competition,
which puts pressure on prices. This is partly regulating the markets as farmers now have more choices
on where to purchase their fertilizer. As profit margins for fertilizer are decreasing, there is a danger as
shops will look for more “creative” ways to keep up profits. This could result in the cost being put on
smallholder farmers.
Government capacity to regulate the market is weak. The capacity to verify quality on a regular basis
does not exist. Capacity to check non-registered fertilizer outlets is too low.
The capacity of the fertilizer sector for self-regulation is rudimentary and they should make an effort
to increase their self-regulation and not leave it up to government regulation.
Recommendations for entities involved in farm extension services
The application of fertilizer is usually based on the observations of farmers in their villages with neigh-
bors, friends and family. Soil testing is done in only very few cases and is typically only done by from
fertilizer traders who are advising farmers. There is a need for rationalizing fertilizer gifts based in soil
analysis.
The application of fertilizers is considered per season, without strategically building up the quality of
the soils over years. No knowledge exists among the farmers and supporting communities regarding
the way fertilizer applications in one season impacts the soil mineral availability in subsequent seasons.
There is also no knowledge on how parameters such as organic soil matter content and pH can be
monitored and improved. There is a need for long-term strategies in fertilizer gift and mineral
balances in soils.
The University of Wageningen has developed a program (Monitoring and Quality Improvement, MON-
QI) for long-term, sustainable planning purposes for soil.
Soil is a precious production asset that requires maintenance. In Myanmar and in many other parts of
the world, soil maintenance its costs are considered. As a result, soils are becoming increasingly
exhausted, which drives the need to use more chemical fertilizer up and increases the cost for produc-
tion of crops even more. There is a need to invest in soil maintenance by farmers.
Farmer knowledge on fertilizer and fertilizer-use is limited. There is a need for more farmer extension
and on-farm experimenting with fertilizer applications. Most importantly, farming families need to
be included in the design and evaluation of these experimentations.

It is also important to reverse the trend of lowering soil quality and to use fertilizers in a way that
strategically improves the quality of the soils and improves the resilience of crop production systems
in extreme climates. Investing in capacity building is highly recommended, especially between farming
families and farming support organizations. It is important to consider the measurement and monitor-
ing of the most critical soil parameters and determine strategies to improve the values of these param-
eters over time. Also, we must consider how using optimal fertilizer doses and combinations and
applying adapted soil tillage and weeding technologies, and regarding the optimal combinations of
improved germplasm and improved soil fertility strategies toward gradual and sustainable yield
improvements..
Recommendations for the government
As previously mentioned, many rumors circulate on what happens to the quality of fertilizer once it is
mixed. It is difficult to verify these rumors but it is also important not to neglect them. There is a need
for more quality testing of fertilizer also at the point where farmers purchase fertilizer. Farmers need
to be protected against companies that deliver poor quality fertilizer.
The government has adopted the revised fertilizer law but law enforcement is a major issue. The
government should identify resources and capacity (incl. technical staff of land use department) to
enforce the law. The law should be enforced to avoid low quality fertilizer and illegal imports.
Recommendations for credit providers
Access to credit has definitely increased over the past 3 years especially in the Ayarwaddy Delta. The
role of moneylenders has decreased while the MADB, farmer associations and Micro Finance
institutions have increased in terms of providing credit (especially to farmers with access to irrigation).
In other areas, the role of more informal credit providers like moneylenders, fertilizer shops and friends
and family shows how limited the access is to more formal credit. There is a need to expand access to
credit to other crops in addition to rice.
There is concern that many Myanmar rural households are increasingly indebted in part because to
the increase in cost for farmer inputs. There is a need for close monitoring of farmer debts and cost
farmers pay for indebtedness.
Recommendations for farmers and extension service providers
Weather is increasingly becoming an influential factor in the farmer business. This is likely because of
its combination with higher input levels. This in turn puts pressure on sales prices and farmer indebt-
edness call for improving farmer’s resilience against bad and unreliable weather.

Annex I List of Key informants

Name Position Department/organisation/company
Public sector
U Kyaw Win Director General Department of Agriculture (DOA)
U Soe Win Director, Land Use Division Department of Agriculture (DOA)
U Aye KoKo Director, Extension Division Department of Agriculture (DOA)
Dr. Su Su Win Director, Soil and water Utilization Department Department of Agriculture Research (DAR)
Academics
Dr. Soe Soe Thein Pro-rector Yezin Agriculture University (YAU)
Dr. Cho Cho San Professor, Agri. Economics Dept. Yezin Agriculture University (YAU)
Dr. Kyaw Ngwe Professor, Agri. Chemistry Dept. Yezin Agriculture University (YAU)
U Khin Soe Senior Advisor Myanmar Rice Federation (MRF)

U Kyaw Tin Myint Director Myanmar Rice Federation (MRF)
Dr. Astrid Faust Technical Advisor Myanmar Fruit and Vegetables Asso.
Private sector
U Than Win General Manager MarlarMyaing Enterprise
U Zaw Win Myint General Manager Taung Paw Thar Ye Shin Co., Ltd
Annex II Summary on application of chemical and organic fertilizers in different area

Table ( 1 )
Group % using Number of times applying % using

chemical chemical fertilizer organic
fertilizer Once Twice Three fertilizer
Rice – no access irrigation 98.8% 100% 100% 91.1% -
Delta
Rice – access irrigation 70.6% 100% 46.0% 3.5% -

Rice – dry season 100% 100% 98.8% 89.4% -
Corn 97.8% 100% 54.0% 2.3% 46.1%
Potato 100% 100% 38.3% 1.3% 100%
Hilly
Cabbage 100% 100% 100% 86.6% 98.5%

Sesame 100% 100% 97.9% 26.8% 87.0%
zone
Groundnut 100% 100% 83.9% 10.6% 21.1%

Dry
Green gram 100% 100% 57.3% 14.6% 1.2%
Table ( 2 )
Group Urea Compound T-super Potash

% Bags/ % Bags/ % Bags/ % Bags/
users users users users
acre acre acre acre
Rice – no access irri- 100% 1.04 40.5% 1.35 51.9% 1.07 0% -
gation
Delta
Rice – access irrigation 99.1% 0.92 5.3% 0.57 59.3% 0.62 9.7% 0.43
Rice – dry season 98.1% 2.37 21.9% 1.09 95.0% 0.95 43.8% 0.54
Corn 82.8% 1.1 83.9% 1.2 6.9% 1.6 0% -
Potato 61.0% 1.6 82.5% 6.4 37.0% 4.2 0.8% 1.5
Hilly
Cabbage 74.6% 2.0 86.6% 6.6 28.4% 3.4 0% -

Sesame 94.6% 0.8 95.8% 1.2 4.6% 0.8 1.7% 0.8
zone
Groundnut 30.4% 0.9 96.3% 1.2 1.9% 1.2 1.9% 0.3

Dry
Green gram 67.1% 0.7 92.7% 0.9 2.4% 1.0 6.1% 1.0

Table ( 3 )
Group % who pay fer- % who needs % who needs

tilizer fully with to borrow to borrow fully
own money partly
Rice – no access irrigation 1.7% 0% 98.3%
Delta
Rice – access irrigation 1.8% 0% 98.2%

Rice – dry season 0.6% 0% 99.4%
Corn 35.6% 20.7% 43.7%
Potato 10.4% 68.2% 21.4%
Hilly
Cabbage 10.4% 79.1% 10.4%

Sesame 17.6% 2.5% 79.9%
zone
Groundnut 44.1% 0.6% 55.3%

Dry
Green gram 50.0% 3.7% 46.3%
Table ( 4 )
Where borrowed money Shop/ Money MADB Friend/ Micro Farmer

to buy fertilizer? fertilizer lender family finance asso-
shop institute cia-tion
Rice – no access irrigation 1.6% 27.4% 64.5% 3.2% - -
Delta
Rice – access irrigation 5.4% 8.9% 36.6% 0.9% 3.6% 44.6%

Rice – dry season 16.4% 8.2% 36.5% 0.6% 0.6% 37.7%
Corn 58.2% 12.7% 14.5% 5.5% 9.1% -
Potato 60.3% 2.1% 7.5% 2.1% 26.7% -
Hilly
Cabbage 58.1% 1.6% 17.7% - 21.0% -

Sesame 21.1% 35.1% 7.7% 22.7% 5.2% 4.1%
zone
Dry
Groundnut 11.1% 48.9% 2.2% 24.4% 6.7% 1.1%

Green gram 20.0% 42.5% 7.5% 17.5% 7.5% -

Chemical and Organic Fertilizer Market in Relation To The

Uploaded by

Copyright:

Available Formats

Chemical and Organic Fertilizer Market in Relation To The

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Chemical and Organic Fertilizer Market in Relation To The

Uploaded by

Copyright:

Available Formats

Chemical and organic fertilizer market in relation to the interests of small farmers in Myanmar July , 2015

Chemical and organic fertilizer market in relation to the

Food Security Working Group

Food Security Working Group 1

Food Security Working Group

2 Food Security Working Group

Township Representing: Crops investigated:

Food Security Working Group i

ii Food Security Working Group

3 Government regulatory policy...............................................................................................................................3

4 Farmers practice, knowledge and interest.............................................................................................................4

4.1 Delta and coastal areas................................................................................................................................. 4

4.1.1 Rice production in the rainy season without access to irrigation.........................................................4

4.1.3 Dry season rice production..................................................................................................................7

4.1.4 Discussions on Ayeyarwady Delta........................................................................................................9

4.2 Upland areas............................................................................................................................................... 10

4.2.4 Discussions on the upland areas........................................................................................................16

4.3 Dry zone...................................................................................................................................................... 17

4.3.2 Ground nuts....................................................................................................................................... 19

4.3.3 Green grams....................................................................................................................................... 21

4.3.4 Discussions on the dry zone...............................................................................................................22

5.3 Dry zone...................................................................................................................................................... 24

5.4 Market linkages and sales...........................................................................................................................24

6.1 Choosing fertilizer................................................................................................................................... 25

6.2 Fertilizer and yields over time in the Delta.............................................................................................25

6.3 Quality of fertilizer and fertilizer testing.................................................................................................26

6.4 Gender issues......................................................................................................................................... 26

7 Conclusions and recommendations.....................................................................................................................27

Food Security Working Group iii

iv Food Security Working Group

Food Security Working Group 1

2 Food Security Working Group

3 Government regulatory policy

Below is a summary of the fertilizer law enacted in 2002.

Chapter Subject Particular

Chapter 10 Prohibition It is prohibited to operate without registration certificate or business license

In 2015, a revised fertilizer law was approved by the parliament.

Food Security Working Group 3

4 Farmers practice, knowledge and interest

Township Village tract Village # interviews Township Village track

4.1.1 Rice production in the rainy season without access to irrigation

Do you use chemical fertilizer

How many times do you apply chemical fertilizer

4 Food Security Working Group

Composition of fertilizer application 1st application 2nd application 3rd application

How much fertilizer do you use Usage* Amount (bags/acre)**

How do you apply the fertilizer

To purchase fertilizer did you need to borrow money

From whom did you borrow money

Do you use organic fertilizer

Food Security Working Group 5

Do you use chemical fertilizer on rainy season rice

How many times do you apply fertilizer

How much fertilizer do you use Usage* Amount (bags/acre)**

6 Food Security Working Group

Composition of fertilizer application 1st application 2nd application 3rd application

Almost all farmers need to borrow to purchase chemical fertilizer.

To purchase fertilizer did you need to borrow money

From whom did you need to borrow to purchase fertilizer