Agricultural Economics
Fertilizer Price Hikes, Willingness to Pay, and Crop Switching
Linking processor demand, quality premiums, and smallholder contracts along a growing export corridor.
Economics of Productive, Inclusive Agriculture. Research on inputs, seed systems, contracts, and farm performance that informs commercialization and rural development.
Rapid coastal demand growth outpaced contract enforcement capacity inland. The engagement linked commercial incentives to measurable quality at reception gates.
Fertilizer is a critical input for crop productivity, but price volatility poses challenges for farmers. Recent fertilizer price hikes in Ghana have forced households to reconsider input use, crop choices, and willingness to pay. This study examines how price shocks influence farmer decisions, including crop switching to less input-intensive alternatives. The broader challenge is that fertilizer price volatility undermines productivity and food security. Poor households are disproportionately affected, reducing input use and shifting to low-input crops. Understanding willingness to pay and crop switching behavior is critical for designing policies that stabilize input markets.
Fertilizer price volatility drives willingness to pay and crop switching, reshaping agricultural systems.
Adzawla, W., et al
2025
Background
Advancing through the data
Fertilizer is a critical input for crop productivity, but price volatility poses challenges for farmers. Recent fertilizer price hikes in Ghana have forced households to reconsider input use, crop choices, and willingness to pay. This study examines how price shocks influence farmer decisions, including crop switching to less input-intensive alternatives. The broader challenge is that fertilizer price volatility undermines productivity and food security. Poor households are disproportionately affected, reducing input use and shifting to low-input crops. Understanding willingness to pay and crop switching behavior is critical for designing policies that stabilize input markets.
Research Approach
Household survey data was collected to capture fertilizer use, willingness to pay, and crop choice under price shocks. Econometric models were applied to measure the impact of price hikes on input use and crop switching. Qualitative interviews provided insights into farmer perceptions of fertilizer affordability and coping strategies. Comparative analysis was conducted across income groups to capture heterogeneity in responses. This dual approach ensured findings were both statistically rigorous and contextually grounded.
Key findings from this study include:
- Price hikes reduced fertilizer use among poor households.
- Willingness to pay varied across income groups.
- Crop switching to low-input alternatives increased during price shocks.
Implications
A strategic lens for organizations and policymakers
Policymakers should design subsidy programs to stabilize input use.
Organizations can support farmer coping strategies.
Businesses must adapt to demand shifts during volatility.
For organizations, this research informs subsidy program design. For policymakers, it highlights the need for input market stabilization. For businesses, it shows how price volatility reshapes demand.
Fertilizer price volatility drives willingness to pay and crop switching, reshaping agricultural systems.
Adzawla, W., et al, 2025
