Fertilizer Case Study

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Incidence of fertilizer policies overseas BRAZIL Brazil is traditionally a net importer of fertilizers. The fertilizer industry in Brazil is heavily dependent on the imports of raw materials and intermediate products. The price volatility in the international market compelled the Brazilian government to think of introducing a state owned company (in the year 2008-09) to regulate the domestic fertilizer market and increase the availability of raw materials. The state owned company has two major functions; to explore mineral fields and source major minerals, and to act as price buffering mechanism between international and domestic markets. It has to subsidise domestic prices when international prices are high and earn profits when the situation …show more content…

The government intervention started in the year 1973, when it created the Fertilizer Industry Authority (FIA). The jurisdiction of FIA included control over prices, distribution, import, export and production. FIA was also given tax exemption for imports of all kinds of fertilizers. The Fertilizer and Pesticide Authority (FPA) replaced the FIA in 1977, and it is currently the authority for implementation of fertilizer policies. As a part of the liberalization policy of the government, the fertilizer trade was deregulated in the year 1986. Even though the fertilizer subsidies had contributed significantly to the increase in fertilizer consumption and higher agricultural yield, it was put on hold from 1998. A policy which provided import duty incentives was implemented in 1997. This policy allowed duty exemption for fertilizer shipments. From the year 1999, fertilizer imports by cooperatives, farmers’ associations and other entities directly involved in agriculture were given complete exemption from VAT (Alcala 2012). The fertilizer requirements of Philippines are met from domestic production, imports as well as fertilizer grants from countries like Japan. Policy to popularise the use of organic fertilizers has also been implemented (Bunoan-olegario

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