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Organic Fertilizer

1.Product Description: Organic fertilizer is made by converting straw in to compost by bringing the straw in contact with suitable converting medium produced by a small quantity of carefully measured mineral salts and water to promote development of aerobic micro-organisms. The straw compost when incorporated with the soil will promote the development of micro flora which are essential for plants to assimilate minerals in the soil. Organic fertilizer increases the productivity of soil from 50 to 130 percent.

2.Rationale: With declining soil fertility because of soil erosion, farms in many parts of the country need fertilizer to maintain and/or increase their level of productivity. Presently almost the entire requirement of fertilizer is met though imports which have adverse effects on the country’s limited foreign exchange resources. The production of organic fertilizer in the country will partially substitute imported fertilizer and it will be used by many low income farmers because of its lower prices. The Amhara Region being the largest grain growing region in the country produces the largest volume of straw which can be used as the main raw material for producing organic fertilizer. With the severe soil erosion affecting the region and the consequent decline of soil fertility, the establishment of small plants to produce organic fertilizer will be rewarding to investors as well as farmers of the region.

 

3.Market Potential: With 3.5 million farming families and more than 5 million hectares of land under cultivation, the potential demand for organic fertilizer is high. One can safely assume that any production volume in any locality will be sold to farmers in the surrounding areas.

 

IMPORT OF FERTILIZER (TONS)

 

Year

Quantity

Value

2000

155,082

229,003,770

2001

182,739    

378,073,522      

2002

319,412      

566,784,396        

2003

121,036      

224,332,629                 

2004

405,605      

1,198,460,522

2005

299,497      

850,198,025      

2006

356,065      

1,074,699,736        

Average

262,777      

645,936,086      

 

Source; External Trade Statistics.

4.However, like any new product, the marketing of organic fertilizer will require effective promotion and introduction to target customers.

 

5. Source of Raw Material: Straw, the main raw material, will be collected form the surrounding farms. Other inputs will be obtained from their sources.

 

6.Process and Technology: The main production process include milling the straw by the use of a hammer mill, mizing chemical additives in to the mass of straw, arranging the milled straw in piles and regularly watering and turning of the piles. Main machinery include hammer mills, mixing equipment and tools and other accessories.

 

7.Estimated Investment: for a plant which will process 9000 tones of straw which is equivalent to 18000 ton\s of organic fertilizer at 50% humidity, the estimated investment will be as follows.

§  Shade 500 m2 at Birr 400/m2               200,000

§  Equipment                                        950,000

§  Working Capital                               200,000

                                                            1,350,000

 

8.  Benefits: Increase crop production of the regions saves foreign exchange resources of the country, utilizes crop residue for producing a much needed product, and introduces new skills and technology.

 

1.      Location: Any locality where straw is to be found in sufficient quantities.


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