In the Southern Gonder Zone of Amhara Regional State, skyrocketing fertiliser prices have thrown farmers into crisis, threatening both their livelihoods and the region’s agricultural output.

Mulatu Banke, a 45-year-old farmer and father of five, cultivates two hectares of land with onion, wheat, and teff. He usually harvests 15 quintals of teff and 40 quintals of wheat annually, selling most of his produce to sustain his family. But this year, he has not bought any fertiliser, he cannot afford it.

"I haven't bought anything," he said. "It's too expensive."

Fertiliser prices have doubled, sending shockwaves through farming communities. Mulatu has asked district agriculture officers to lower prices, but he has not yet received a response.

"I will wait until the prices come down," he said.

Farmers across the country are facing similar struggles. The price of diammonium phosphate (DAP) fertiliser has surged to 7,000–8,000 Br per quintal, while Urea now costs between 5,000 and 6,700 Br per quintal. The price hikes stem from the depreciation of the Birr, rising global fertiliser costs, and surging demand.

The Amhara Regional State, where over two million farmers depend on agriculture, has been hit particularly hard. The government supplied 1.4 million quintals of fertiliser from the annual demand 8.8 million quintals needed. In South Gonder’s Fogera district, only 9,200 quintals have been distributed, while demand stands at 115,690 quintals.

Weletaw Abate, head of the district agriculture office, acknowledged the financial strain on farmers.

"DAP is being sold at 8,000 Br, and urea prices have also increased," he said. "Farmers are struggling to afford it."

Officials insist credit options are available for farmers who cannot afford fertiliser, but many farmers say otherwise.

Faced with rising prices, farmers are cutting their fertiliser use by up to 50pc, risking lower yields. Abera Bante, a 50-year-old farmer from Fogera, could only afford one quintal of urea and DAP.

"I just can't afford it," he said.

Abera, who supports a family of six, is also struggling with soaring seed prices. Onion seeds now cost 9,000 Br per quintal. His income from farming has dropped, making it even harder to cover costs.

Many farmers have stopped production entirely. Others have scaled back because they lack the money and access to credit.

According to Sophia Kassa (PhD), state minister for Agriculture, the government distributed 4.5 million quintals of fertiliser last month, about 20pc of the 24 million quintals planned for the year. This is four million quintals more than last year’s import.

A recent shipment of 4.5 million quintals has reached the country and is being distributed to regional states. Three more ships carrying 6.4 million quintals have arrived at Djibouti’s ports.

The government has allocated 1.3 billion dollars and 156 billion Br for DAP and urea fertilisers this fiscal year. However, higher-than-expected DAP prices may require additional funding.

Last year, the federal government spent a billion dollars on fertiliser, with subsidies reaching 15 billion Br. This year, subsidies have jumped to 84 billion Br, a staggering 253pc increase.

"We are providing the highest subsidy in our history," Sophia said.

She stated that the government now subsidises 3,700 Br per quintal and the Ministry of Agriculture (MoA) has instructed regional governments to offer credit to farmers. However, farmers say they have yet to see any real assistance.

A three-year study by the Agricultural Transformation Institute (ATI) found that NPS fertiliser, containing nitrogen, phosphorus, and sulfur, is too acidic for Ethiopian soil, particularly the variants with boron and zinc. Researchers recommended shifting procurement toward DAP, which contains only phosphorus and nitrogen.

Soil acidity has become a growing problem, reducing productivity, causing fertiliser wastage, and leading to revenue losses.

Mengistu Tesfa, head of agricultural inputs at the MoA and chair of the national fertiliser procurement committee, acknowledged the problem.

"DAP is more expensive, which has pushed up the average fertiliser price," he said. "But it is better suited for acidic soils."

The government procures fertiliser year-round. In the sixth round of procurement, authorities sought to acquire 611,000 tonnes of DAP and 821,000 tonnes of urea.

The price of DAP has surged to 627 dollars per tonne, an increase of 122 dollars from the previously purchased NPS fertiliser. Urea prices have remained relatively stable at 353 dollars per tonne, compared to the previous purchase price of 366 dollars per tonne.

"Farmers have no choice but to buy it," said Sophia.

Mengistu insists that government subsidies had eased the burden.

"Farmers should be grateful for the government’s efforts," he told Fortune.

Last year, the Ministry changed its fertiliser procurement strategy, forming a new Board that including Mamo Mihretu, governor of the National Bank of Ethiopia (NBE); Alemu Sime (PhD), minister for Transport & Logistics; Alemtsehay Paolos, cabinet affairs minister; Semereta Sewasew, state minister for Finance; and Abie Sano, president of the Commercial Bank of Ethiopia (CBE).

Despite rising import volumes, global fertiliser prices have dropped slightly. This allowed the government to spend 20 billion Br less on fertiliser while securing higher quantities.

This year, Ethiopia primarily imported fertiliser from Russia, China, Saudi Arabia, and the United Arab Emirates (UAE).

Regional governments worry over crippling fertiliser costs, which heavily burden smallholder farmers.

In Oromia Regional State, home to 6.8 million farmers and 11.6 million hectares of farmland, cooperatives expect further price surges for fertiliser imports and distribution.

The Bora Denbel Multi-Purpose Cooperative Union, which represents 25,000 farmers, has only distributed 32,000 quintals of fertiliser, far below the 316,000 quintals needed for the year.

Sophia insists the government is exploring a deferred payment scheme, where farmers could pay back later through regional governments.

However, Aleyi Seko, head of the Union, says no such credit or loans have been provided.

Ministry officials argue that the crisis stems from seasonal demand spikes, logistical and infrastructure bottlenecks, and growing instability disrupting distributions.

Some farmers are shifting to low-fertiliser crops like chickpeas, while regional agricultural authorities are promoting composting to reduce dependence on chemical fertilisers.

Badiho Birmeji, a 50-year-old farmer in Meki, supports six children and cultivates 20 hectares of maize and wheat. This year, he faced a 100pc surge in fertiliser prices. Unable to afford his planned purchase of 40 quintals, he bought only 20 quintals, halving his input and risking his yield.

Badiho also worries about soil degradation caused by fertiliser acidity.

"It's not just about producing enough for the market," he said. "It's about our own survival."

The global fertiliser market, valued at 381.7 billion dollars in 2024, is projected to reach 541.2 billion dollars by 2030, growing at 5.99pc annually.

Asia-Pacific leads global production at 44.8pc, followed by Europe and South America. China, the world’s largest producer and exporter, accounts for 25pc of global fertiliser supply.

A recent study by the Ministry on wheat production found 248 billion Br in losses last year. Expected yields of 42 quintals per hectare fell to 26 quintals, a 40pc decline.

Lire Abio, soil resource development director at the Ministry, identified soil acidity as the primary cause.

Of Ethiopia’s 17 million hectares of cultivated land, 3.1 million hectares are severely affected by acidity. The most impacted regional states are Oromia with 1.7 million hectares, Amhara with 607,000 hectares, and Southwest Ethiopia with 417,000 hectares.

Severe soil acidity is increasing at an average rate of 4.48pc per year, worsening the crisis.