Kenya’s fertiliser subsidy programme is facing renewed scrutiny as new evidence shows that the centralised NFSP-2 model may be increasing hidden costs for farmers and weakening the country’s input supply chains.
- •The World Bank has highlighted the need to tackle transport costs, expand extension services, and adopt digital tools to help farmers make informed fertiliser choices.
- •The institution has recommended integrating more private agro-dealers into last-mile distribution to restore competition and reduce travel distances.
- •Experts have also pointed out that the subsidy has altered the country's fertiliser mix as it includes a blanket exclusion of the DAP model.
Before 2022, farmers used cash-value vouchers to buy fertiliser from nearby private agro-dealers. Today, under the second National Fertiliser Subsidy Programme, the government contracts a few importers to supply fertiliser at fixed prices, distributed mainly through NCPB depots. This has pushed many farmers further from access points, with the average distance to an NCPB depot now 18 km, compared to 6 km to a private agro-dealer under the previous system. The long trips, often by boda boda, raise transport costs that erode the intended savings from the subsidy.
The exclusion of private agro-dealers has also hurt rural economies. Studies estimate that more than 200,000 jobs have been lost along the fertiliser supply chain as private distributors lose business. At the same time, research shows that NCPB’s all-in landing costs are roughly similar to those of private suppliers, signalling that the centralised system has not achieved the expected cost efficiencies.
NFSP-2 has also altered the country’s fertiliser mix. DAP, which made up 37% of imports before the reforms, now accounts for less than 25% after being excluded from the subsidy over soil acidity concerns. In contrast, NPK 23:23:0, heavily allocated under the programme, has surged despite mixed performance in some soils. Experts at KALRO argue that a blanket exclusion of DAP ignores regional differences and that many farmers still achieve higher short-term yields from DAP than from other blends.
The World Bank has also urged the government to improve transparency by publishing the names and terms of contracted suppliers, and to allow a wider fertiliser mix guided by scientific recommendations rather than administrative bans.
