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Hooker I Julv. 1998 I 1 l -~----,--~ FINAL EVALUATION OF THE BANGLADESH FERTILIZER DISTJUBUTION IMPROVEMENT-I PROJECT (USAID Project 388-0024) TABLE OF CONTENTS Acknowledgments i i Abbreviations and Acronynnns iii Weights and Measures i v List of Tables v List of Figures 'ti Executive Summary: Findings, Lessons LeafIlled, and Recommendations 1 Introduction and Country Context 3 Part A: The Impact of FDI-I on Fertilizer Supply and Availability in Bangladesh 16 Part B: The Equity Issues allld Impacts of FDlI-I 26 Part C: An Assessment of the Progress in Implfmenting the New Marketillg System for Fertilizer 42 Part D: The Efficiency of I~ertilizer Use in )Bangladesh 48 Part E: Role and Influence of FDI-I on FerHlizer Pricing Policies and Subsid:y Costs 51 Part F: Organization and Management of FewtHiLer Distribution: The Roles of ]l)ADC, USAID, and IFDC Append;ces: I. Evaluation Scope of WI{)rk II • FDJ-I Logical FramewClIrk--1978 & 1981 I I I . Evaluation Methodology IV. Information Resources V. Tables ACKNOWLI~DGMENTS The FDI-I Evaluation Team V'londd mu~ to ,~dmoV'lledge tile he1ilfUI assistance of several people. Dr. Ray Renfro, tbe FDI-I project officer, made every attempt to cooperate and assist the Team with support and information, including special farmer survey data collected under his leadership just weeks before tthe initiation of th~ evaluation. Dr. Charles Hash and Mr. Alan Hurdus of the Food and Agriculture Office provided friendly and helpful guidance to the Team, especially after the original team leader was medic!ally evacuated from Bangladesh. Mr. Keli Moots, Chief of Party for IFDC/Dhaka, provided not only information and assistance but also transportation and personnel resources to the Team, without wbich tbe evaluation would not have Leen completed on time. Dr. Ray Diamond of IFDC/Dlhalka was tireless and unfailingly patient in his technicnl and editor;lill assistance to the Team. Ms. Kay Cnlavsn, the Mis!iion Evaluation Officer, provided helpfu I assistance in planning the field work and evalua Hon design. Finally, Mr. A.K.M. Sbahjahan of BADe did not aUways agree with the methods and conclusions of the Team but worked during vacation periods and evenings to provide requested data and complete field. trips. Craig L. Infanger July, 1988 i ABBREVIATIONS AND ACRONYMS ADP Annual Development PlaJl1 BADe Bangladesh Agricultural :Development Corporation BARC Bangladesh Agricultural Research Council BBS Bangladesh Bureau of Stntistics Bele Bangladesh Chemical Industries Corporation BDG Government of Ballgladellh BIDS Bangladesh Institute for ][)evelopment Studies BRRI Bangladesh Rice Research Institute DAP Diammonium Phosphate DD&T Dealer Development and Training (BADe) EPA DC East Pakistan Agricultural Development Corporation EPe Engineerin~: and Planninl~ Consultants FAO Food and AI~riculture Orlganization, United Nations FDI-I USAID Fertflizer Distribution Improvement Project-Phase One FDI-II USAID Fertilizer Distribution hr.provemcllt Project-Phase Two FY Fiscal Year (July 1-June 30 in Bangladesh) GTSP Granular Triple Superphosphate HYV High Yielding Variety IFDC International Fertilizer Development Center IFPRI International Food Policy Research Institute IEeo International Engineering Company, Inc. KDC Korean Development Corporation KSS Krishi Samabaya Samity MP Muriate of Potash NFSP National Fertilizer Storalte Plan NMS New (Fertilizer) Marketing System NPl{ Compound Fertilizer Containinc Nitrogen, Phosphate, and Potash OMS Old (Fertilizer) MarketiHl~ System PDP Primary Distribution Point pp Project Paper TA Technical Assistance TCCA Thana Central Cooperative Association TDP Transporation Discount Point TSC Thana Sales Center TSP Triple Superphosphate USAID U.S. Agency for International Developmenll ii WEIGHTS AND MEASURES 1 acre (ae) g: OAOS hectare (ba) I Idlngram (kg) ~ 2.20S ~\ounds (Ib) ~ 1.07 seers (Sf) 1 short ton (st) :: 2,000 II> ". 0.907 metric ton (mt) 1 long ton (It) = 2,240 Ib ~ ],02 rut g 27.2 md 1 metric ton (rot) ~ 1,000 11)Z l'i!: 26.8 mmund 1 Maund (rod) g 40 seen 20: 82.27 Ib g 37..3 k:g 1 seer (s"') g 2.06 Ib g 0.93 kg 1 Taka (Tk) '" $0.03HI (May 1988) 1 U.S. Dollar (US$) g 31.44 Taka (Ma~' ] 988) iii LIST OF TABLES Table Contents A.I Annual Fertilizer Sales by Fiscal Year A.2 Estimated Fertilizer Use Pel' Acre By Region A.3 Fertilizer Imports by Year and Type of Fertilizer, 1971-37 A.4 Fertilizer Factory Production Performance A.S USAID Involvement in Fertilizer Production and Distribution in Bangladesh~ 1974-1988 A.6 Estimated Total and Per CSI)ita Foodgl'sin PI'oduction, FY 1977-1988 A.7 Seasonal Trends in Fertilizei' Consumption A.8 Fertilizer Imports Under FDI-I A.9 USAID Financed Fertilizer Warehouse Contrllction Under FDI-I, 1979-1986 B.l Estimates of· Percentage of Fu.ners Using FeJrtiHzer On Ric.e By Season D.2 Quantity of Fertilizer Now Being Used Compared to Pre-1980, By Farm Size Claiss B.3 Total Fertilizer Used and AH~rage Per Acre Use, 1987-38 Rabi/Boro Season, Rice and Other Crops B.4 Fertilizer Applied to Crops by Sample Farmers, Boro Season, 1980/81,1981/82,1985/86 and 1987/88 8.5 Average Prices Paid fol' Fertilizers by SamplE~ F:llrmers, 1987/88 BOI'o Season, By FUl'm Size Class B.6 Price Differences Between Non-Remote and Hemote Villages in Two Divisions, 1978-) 982 8.7 Relative Price Changes in Non-Remote and Remote Villages in Two Divisions, 1973-1982 C.l Estimated BADC Fertilizer Procurement Costs, Sale Prices, and Approximate Nominal Subsidy, 1975/76-1986/87 C.2 Nutrient and. Rice Price and Value/Cost Ratios by Cropping Season, 1982-87 C.3 BADC Fertilizer Demonstration Program c.ot BADe Expenditures for Dealer Training Pro~:rams C.S Progl'ess -:>f BADC Dealer Training D.l Irrigated Acreage Under Modem 2lnd Traditional Methods, 1970-1936 D.2 Crop Acreage Under HYV Seeds, 1979~1987 D.3 HYV and Local Variety Ricl~ Yield:; Under hrigated and Raided Conditions, 1979-80 D.4 Use of Modern Inputs by Farm Size and Tell~lncy, 1982 E.l Estimated Economic Subsidy on Fertilizer, June 1987 F.l Administrative Responsibility for FDI-I, 1979-1988 F.2 PDP-Wise/Year-Wise Sales and Godown Capacity, 1983-§7 F.3 BADC Expenditures for Repairs and Mainten.ance of Godowns, 1981-1988 F.4 Principal Reports Issued By l!FDC Technical Assistance Team for FDI-I iv LIST OF FIGURES Number Content~ 1. Annual Fertilizer Sales by lriseal Year (,OOOMT) 2. Fertilizer Imports by Year land Type, 1976~ 1987 3. Population and Foodgl'ain I~roduction Trends, 1977-1988 4. Seasonal Tnends in Fertilizer Consumption, Selected Years, L",-/O-1986 5. Fertilizer Applied to Crops by Farmers in tlue Horo Season, Selected Yeaf!i: 6. Approximate Nominal Fertilizer Subsidy, 19'75-1987 7. BADe Modes of Fertilizer Movement 8. Crop Acreage Under HYV Seeds, 1979-1987 v EXECUTIVE SUMMARY FINAL EVALUATION OF THE FERTILIZER DISTRIBUTION IMPROVEMENT PROJECT -I (USAID Project 388-0024) Project Purpose The Fertilher Distribution Ill1IproY~mcnt Project, Phase I (fDI-I), is an integration and expansion of' three separate USAID agricultural development efforts in fertiliuf storage, bullk handling, and agricultural input supply during the early 1970s in Bangladesh. The overall goal of FDI-I was to increase foodgrain production, especially by small farmers. To achieve the stated purpose of incr~asillg fertilizer use 011 an equitable basis, FDI-I outputs included fertilizer warehouse construction) fertilizer imports, as well as institutional development and poHcy reform designed to est.lblish private, free market distribution of fertilize.'. hnplementalion was carried ou t by t he Bangladesh Agricul tu ral Developmen t Corpora tion (BADC), a statutory corporation und,er the Ministry of Agriculture and Forests. The project agreement was signed in 1978 and total U.S. assistance as of May 1988 has been approximately $222 million. Purpose of Evaluation and Methods Used The purpose of this final evaluation of FOJ-I is to assess the impact of the project on fertilizer availability and use in Bangladesh, determine if project performance to date is consistent with expectations, and identify actions necessary to sustain and carry forward the pnsithe effects of the project in Phase II (FDI-II). The evaluation was conducted by external consultants from SECID Research International, Dr. Craig L. lofanger (Team Leader), Dr. Raymond Hooker, and one Bangladeshi consultant, Mr. A. Samad. The implementing agency assigned fOlH senior man,agement officials to assist the evaluation team: A.ICM. Shahjahan, Mofazzel Hossain, Giasuddin Ahmed, and Atiqur Rahman. The Team reviewed periinent tJSAID files and project documents as well as related studies completed by other BnG agencies, private consultants. and international agencies. All resident USAID agricultural officers and the TA Team were interviewed regarding project performance. Rapid reconn,aissance inteniel'fs were conducted with ove forty prhate fertilizer wholesalers and retailers, and with BADe field officers. Fjeld visits were made to village mar~ets and BADe distribution points in four regions as well as one visit to a fertilizer factory. Key fertilizer use and marl.cHng data were analyzed, including farmer survey data collected by the Mission for the 1987/88 Rabi/Boro season. The in-country portion of this evaluation took place from April 12 to June 5, 1988. Principal Findings 1. FDI-I has made a positite contribution tG the program goal of increased foodgrain production in Bangladesh.
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