Chapter 53 Fertilizers and other farm chemicals☆
Introduction
In 1961, developing countries consumed only 12% of the world total consumption of manufactured fertilizer nutrients.1 Industrialized countries used over 70% of the world total, with the countries now sometimes referred to as the transitional economies of Eastern Europe and the former Soviet Union making up the balance. The United States was the world's largest single country user, accounting for about a quarter of all nutrient consumption. Application rates (kg of nitrogen, phosphorus, and potassium nutrients per crop hectare) were over ten times as high in industrialized countries as in developing countries.
By 1977, total fertilizer nutrient consumption in developing countries overtook consumption in the current transitional economies, and by 1984, it surpassed consumption in industrialized countries for the first time. About the same time, China overtook the United States to become the world's leading consumer of fertilizer nutrients. By 2001, developing countries consumed 64% of total nutrients and industrialized countries 31%. Consumption in transitional economies, which had reached a peak share of 27% in the mid-1980s, had collapsed after 1990 and only constituted a little more than 5% of the total. China alone accounted for about a quarter of all nutrient consumption, and India for about one-eighth. India stood just behind the U.S., with its 14% share, as the third largest user of fertilizer. Application rates in industrialized countries were still higher than in developing countries, but only by about 20 to 25% on average.
In contrast to data on fertilizers, data on pesticide use (in particular herbicides, insecticides, and fungicides) over time by region and country are limited, especially for pesticide usage prior to 1990. Some data do exist, however, and it is clear that pesticide use has grown over time in developing countries as a proportion of total use [FAOSTAT (2004)]. As of the mid-1990s, developing countries consumed approximately 25% of all pesticides, 85% of it for agricultural purposes [World Resources Institute (1999)].
This chapter surveys the current state and historical development of markets for fertilizers and pesticides in developing countries. The chapter begins with a discussion of fertilizer consumption by region and by crop, as well as a brief summary of pesticide consumption. The next section reviews determinants of consumption on both the demand and supply sides. Very broadly, fertilizers can be seen as substitutes for land, and all other things equal, one would expect high fertilizer consumption to develop in land-short, labor-abundant agricultural economies. In contrast, herbicides can be seen as substitutes for labor-intensive hand weeding, and thus they might be most widely used in land-abundant, labor-short agriculture. Broad input substitution effects appear less determinative for consumption of insecticides and fungicides; instead, one major cause for widespread use of these latter two pesticides may be whether strong host-plant resistance to the relevant pests is widely available in cultivars planted by farmers. However, other interacting factors also influence the use of farm chemicals, and the determinants of consumption may shift over time. Factor substitution and other causes for farm chemical use will be analyzed in greater detail below.
Following the discussion of farm chemical consumption, the next substantive section considers two issues in market development. Price and regulatory policy, in particular subsidies for chemical inputs such as fertilizer, have been widely debated in the literature, and these debates will be summarized. Environmental issues in the use of fertilizers and pesticides have been prominently recognized for agriculture in developed countries. The nature of negative externalities from chemical use in developing countries, as well as possible policy responses, will also be addressed. The chapter concludes with a brief summary.
Section snippets
Fertilizer consumption by region
As noted, the growth of fertilizer consumption in developing countries has been extremely rapid. This subsection summarizes trends in developing country fertilizer use. The following section, on the determinants of fertilizer use, will outline some of the reasons for the observed trends and reasons for differences between those trends in different parts of the world.
Table 1 presents summary data for 1999–2001. The two most populous countries in the world, China and India, account for a
Determinants of consumption
This section discusses economic and other factors that can affect the consumption of fertilizer and other farm chemicals. The majority of the discussion will focus on fertilizer, but some of the factors that specifically influence the use of pesticides will be considered in the ultimate sub-section.
Issues in market development
Policy discussions concerning the use of fertilizer and other farm chemicals in developing countries usually coalesce around one of two broad sets of issues. The literature relating to price and regulatory policy tends to apply particularly to fertilizer. Environmental issues, on the other hand, tend to be particularly important in pesticide use, although fertilizer use also has environmental dimensions.
Summary
The market for fertilizer in developing countries, measured by nutrient consumption, has expanded at a striking rate over the past 40 years. Fertilizer use has been stimulated in particular both by demand side factors such as the introduction of fertilizer responsive HYVs, and by supply side factors such as the reduction in fertilizer price as the result of technological advance in fertilizer production. The expansion in fertilizer consumption has been uneven, however, as it has been
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The effect of agricultural subsidies on chemical fertilizer use: Evidence from a new policy in China
2023, Journal of Environmental ManagementNonlinear effects of internet development on chemical fertilizer application intensity: Macro evidence from China
2023, Journal of Cleaner ProductionThe relationship between farm size and fertilizer use efficiency: Evidence from China
2022, Journal of Integrative AgricultureCitation Excerpt :According to Heisey and Norton (2007), the relative scarcity of agricultural land has been a major underlying cause of the expansion in demand of fertilizers, and more proximate causes include seed varieties and expansion of irrigation or better water control within irrigated systems, declined real fertilizer prices, etc. In addition, soil characteristics, seed varieties, hired labor, applied technology, and education all influence farmers’ use of fertilizers (Qiao et al. 2003; Heisey and Norton 2007; Wu 2011; Huang et al. 2015; Huang and Ding 2016; Li et al. 2017; Mason et al. 2017; Morello et al. 2018). Another important determinant of farmers’ fertilizer use behavior is farm size, as revealed by a range of studies (Zhang et al. 2013; Ju et al. 2016; Wu et al. 2018; Cheng et al. 2019; Hu et al. 2019; Ren et al. 2019; Zhu and Wang 2020).
Agricultural inputs, urbanization, and urban-rural income disparity: Evidence from China
2019, China Economic ReviewCitation Excerpt :In terms of intensity, China's agricultural fertilizer application is 328.5 kg per ha, which is substantially higher than the world average of 120 kg per ha (the Ministry of Agriculture of the People's Republic of China, 2015). The main cause for the staggering amount of chemical fertilizer application in China over the past half century is the yield-increasing effect of chemical fertilizers on agricultural production (Heisey & Norton, 2007). Lin (1992) argued that the contribution of the household contract responsibility system (HRS) to the total value of agricultural output over the period 1978–1984 was 46.89%, and the contribution of chemical fertilizer application was 32.20%.
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The views expressed in this chapter are those of the authors and are not to be attributed to the U.S. Department of Agriculture.