An Action Plan for Developing Agricultural Input Markets in Tanzania

get suppliers credits for 10,000-15,000 tons of urea and
3,500 tons of CAN by providing suppliers with a lien
on stocks. 10 TFC sales for 2001 and 2002 are shown in
Table II.7.
Table II.7. Fertilizer Sales by Tanzania Fertilizer
Company (TFC) (2001 and 2002)
Source: TFC.
Premium Agro Chemicals (PAC)—PAC, a private
sector organization, is the largest fertilizer company
in Tanzania. It started a few years ago and by
1998/99 it was importing and marketing about 15,000
tons of fertilizers. In 2003 PAC had imported about
70,000 product tons of fertilizers mainly from Norsk
Hydro, Kemira, Transammonia, and other international
suppliers. Product came from Europe, the Middle East,
and Russia through international letters of credit established
through Standard Chartered, Exim, National
Bank of Commerce, and CRDB banks. There are no
import duties on fertilizers. Estimates of other costs
and charges on imports are shown in Table II.8.
According to PAC, its market share is about 60%-
70%. It markets the product through a network of about
300 dealers (including sub-dealers) and operates four
warehouses in the field at Makambako (600 tons),
Njombe (2,000 tons), Mbeya (5,000 tons), and Songea
(3,000 tons) in addition to its large excellent warehouses
(one owned and one rented) in Dar es Salaam with a
total capacity of about 50,000 tons (10,000 m 2 ). PAC
offers quality product with guaranteed quantity at com-
10 During 2004/05, TFC has been able to borrow funds from
commercial banks by using imported fertilizers as warehouse
collateral.
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Table II.8. Estimated Cost of Urea Imports in
Tanzania (2003)
Source: Based on information gathered during field visits.
petitive prices in the market. All bags are marked with
the PAC logo and bags containing different products
have distinct identification colors. It offers product in
50-kg and 25-kg bags according to the market requirements.
PAC is not in a position to offer agronomic services
and advice to the farmers, but offers short-term
credit (15 days) to a few of its larger reliable dealers in
the provinces. PAC deals only in fertilizers and also
sells to Zambia from its Mbeya regional operations. It
enjoys a good reputation with the dealers in Tanzania
and also with the importers in Zambia as reliable suppliers
of competitively priced good quality products.
Other Importers—STACO, Export Trading,
Mohammed Enterprises, Kibo Traders, Balton, Suba
Agro Trading and Engineering Company (SATEC), and
Mukpar are other companies in the private sector that
have been importing fertilizers through Dar es Salaam,
Mombasa, and Nairobi sourced through Norsk Hydro
and other international producing and trading companies.
Their combined imports are estimated at about
25,000 tons. 11 A few of them also purchase locally from
Premium Agro Chemicals. Unlike PAC, these companies
deal in several other commodities and consumer
goods in addition to fertilizers. A few of them are also
11 See Table II.6 for details.