Fertilizer Sector Improvement Project

Fertilizer Dealer Survey

Submitted by

by

IFDC

P.O. Box 2040

Muscle Shoals, Alabama 35662, USA

www.ifdc.org

March 2015

Disclaimer: The author’s views expressed in this document do not necessarily reflect views of the United

States Agency for International Development or the United States Government.

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Table of Contents

Executive Summary .................................................................................................................. iii

Introduction ................................................................................................................................ 1 The Fertilizer Sector of Myanmar.............................................................................................. 1

Import Supply ........................................................................................................................ 3 Total Fertilizer Supply and Demand ...................................................................................... 4 Fertilizer Distribution ............................................................................................................ 6

The Fertilizer Value Chain......................................................................................................... 7 The Agro-Dealer Survey ............................................................................................................ 8

Method ................................................................................................................................... 9

Survey Forms ....................................................................................................................... 10 Survey Method ..................................................................................................................... 11 Analytical Methods .............................................................................................................. 12 Results .................................................................................................................................. 12

Correlation Analysis ................................................................................................................ 15

Fertilizer Sales Volume Analysis ........................................................................................ 16 Sales Volume Analysis ........................................................................................................ 17 Agro-Dealer Licensing ........................................................................................................ 19

Total Fertilizer Sales by Dealer Size ................................................................................... 20 Total Fertilizer Sales for Ayeyarwaddy Region by Dealer Size ...................................... 22 Bago Region ..................................................................................................................... 23

Yangon Region ................................................................................................................ 24

Dealer Fertilizer Sales and Nutrient Ratios ......................................................................... 25 Dealer Arrangements for Purchasing Fertilizer ................................................................... 25 Supplier Support .................................................................................................................. 27

Farmer Purchases ................................................................................................................. 29 Farmer Fertilizer Product Choice and Knowledge .............................................................. 30

Fertilizer Quality .................................................................................................................. 31 Seed Sales ............................................................................................................................ 31 Pesticide Sales ...................................................................................................................... 32 Constraints for Agro-Dealers ............................................................................................... 32

Training Requirements ........................................................................................................ 34 Fertilizer Quality and Control .............................................................................................. 35 Interest in Urea Briquette Sales and Production .................................................................. 35

Scaling of Survey Data ........................................................................................................ 36

Summary and Recommendations ............................................................................................ 36 Annex 1. Survey Form ............................................................................................................. 39 Annex 2. Ayeyarwaddy Fertilizer Sales 2014 ......................................................................... 48

Annex 3. Fertilizer Sales in Bago Region 2014 ....................................................................... 50 Annex 4. Fertilizer Sales for 11 Agro-Dealers in Yangon Region 2014 ................................. 53 Annex 5. Seed Sales by Region and Dealer Size ..................................................................... 55 Annex 6. Pesticide Sales and Margins for All Agro-Dealers by Region ................................. 60 Annex 7. Scope of Work .......................................................................................................... 61

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Acronyms and Abbreviations

AS Ammonium Sulfate

CAN Calcium Ammonium Nitrate

DAP Diammonium Phosphate

FSI Fertilizer Sector Improvement

GSSP Granulated Single Superphosphate

GTSP Granulated Triple Superphosphate

IFDC International Fertilizer Development Center

K2O Potash

LUD Land Use Department

MADB Myanmar Agricultural Development Bank

MAP Monoammonium Phosphate

MOAI Ministry of Agriculture and Irrigation

MOP Muriate of Potash

N Nitrogen

NPK Nitrogen, Phosphorus and Potassium

P2O5 Phosphate

SOW Scope of Work

UDP Urea Deep Placement

USAID United States Agency for International Development

Importer/Distributor A company importing fertilizer and distributing in Myanmar

Distributor An agro-dealer distributing more than 100,000 50-kg bags of fertilizer

at a regional level to agro-dealers with few sales to farmers.

Agro-dealer Any company selling fertilizer and other agro-inputs at wholesale and

retail level with annual sales of less than 100,000 50-kg bags of

fertilizer.

Large agro-dealer Any agro-dealer with annual fertilizer sales of between 20,000 and

100,000 50-kg bags

Medium agro-dealer Any agro-dealer with annual fertilizer sales of between 1,000 and

20,000 50-kg bags

Small agro-dealer Any agro-dealer with annual fertilizer sales of less than 1,000 50-kg

bags.

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Executive Summary

Efficient and adequate supply and use of agro-inputs, fertilizer, seed and pesticides is

essential for the Myanmar agrarian sector. This report summarizes findings from a previous

policy scoping study of fertilizer procurement, distribution and quality control1 and reports on

a random sample survey of 67 fertilizer agro-dealers in the Ayeyarwaddy, Bago and Yangon

regions of Myanmar. The survey was conducted in March 2015 and was designed to

characterize these businesses and segment them by resource level, capabilities and inputs

knowledge. These dealers are integral to the objectives of the Fertilizer Sector Improvement

(FSI) project funded by the United States Agency for International Development (USAID).

The capacity of agro-dealers to provide factual technical and economic information to their

farmer customers on the appropriate selection of agro-inputs for crops is essential to meet the

FSI objectives.

There are 3,093 fertilizer resellers in Myanmar registered with the Land Use Department

(LUD) of the Myanmar Ministry of Agriculture and Irrigation (November 2014). Of these,

1,341 are located in the three FSI project regions. A 5% random sample of these dealers were

surveyed, segregated and proportioned by gender of the managers. Twenty-four percent of

these businesses are owned by females, but 36% are managed by females.

Extensive data were collected from each of the dealers interviewed ranging from education

and business experience of the managers to business size, fertilizer storage capacity, details

of fertilizer, seed and pesticide purchases and sales in 2014, other product activities, business

constraints, support from the major fertilizer importing and distribution companies and dealer

training requirements.

Data were analyzed first by comparing management gender differences, and although the

female-managed businesses had lower fertilizer sales than male-managed businesses and

smaller storage capacities, there were no other significant differences in business activities.

Of note is that female managers were asked for advice by farmers to the same extent that

male managers were asked.

1 Myanmar Fertilizer Policy, IFDC, Fertilizer Sector Improvement Project, USAID, August 2014.

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Data were then analyzed by segregating based on the volume of annual fertilizer sales into

four categories. These are: (1) area distributors with annual sales of more than 100,000 50-kg

bags; (2) large agro-dealers with annual sales of between 20,000 and 100,000 bags; (3)

medium agro-dealers with annual sales of between 1,000 and 20,000 bags; and (4) small

agro-dealers with less than 1,000 bags in annual sales.2 Results are expressed by region and

in total for the three regions.

There were two dealers in the first category in the Bago region both with annual fertilizer

sales of over 300,000 bags, most of which were urea, and with the bulk of sales to large- and

medium-sized dealers and a few small dealers referred to as sub-dealers. The total income

from fertilizer sale markups (the difference between purchase cost into store and selling

price) is estimated at more than Kyat 67,000,000 per annum.

The 10 large dealers with average annual sales of 25,500 bags generated annual fertilizer

markup income of Kyat 3,341,000. The largest category of dealers, 33 medium-sized, had

average annual fertilizer sales of 5,459 bags and a total fertilizer markup income of Kyat

277,173. In contrast, the 22 small dealers only had average annual fertilizer sales of 263 bags

and a fertilizer markup income of Kyat 31,688. Fertilizer markups averaged around 5.5%

over the whole product range. The large- and medium-sized dealers rely as much on sales to

sub-dealers as they do on sales to farmers, and this effectively increases the farm reach of

these dealers. The small dealers located in village tract and village locations are essentially

sub-dealers who provide a supply service to local farmers in isolated areas in response to

local farmer demands.

Table 1. Percent of Agro-Dealers by Size Category Selling Agro-Inputs

Class Sample No. Fertilizer Seed Pesticides Farm Tools

Small

Machinery

Animal

Feed

Veterinary

Products

Consumer

Goods

Distributors 2 100% 100% 100% 100% 0% 50% 0% 0%

Large 10 100% 90% 40% 50% 20% 10% 10% 0%

Medium 33 100% 91% 52% 58% 36% 6% 0% 9%

Small 22 100% 82% 41% 50% 27% 5% 0% 5%

2 Terminology: Agro-dealers are defined as any retailer of agricultural inputs (fertilizer, seed, pesticides, small

farm tools, small farm machinery, animal feed or veterinary products). Distributors essentially supply large and

medium dealers with very few retail sales.

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Other agro-input sales essentially consist of vegetable seed packages for virtually all dealers

and small containers of the three most popular rice pesticides (Phyuradan, Cyperpar and

Cyclone) by half the dealers together with small farm tools, mainly sprayers, and one-third of

the dealers sell some small farm machinery such as power tillers in the Ayeyarwaddy and

Bago regions. Livestock products are sold by less than 10% of the dealers. Sales of consumer

goods are confined to less than 10% of the medium and small dealers. Markups range from

10% to 15% on seed and from 15% to 20% on pesticides. The limited scale of seed and

pesticide sales with higher markups than on fertilizers by nearly all dealers adds to the limited

profitability of agro-input marketing. A few dealers have secondary business lines such as

construction material or fuel, and many of the small dealers also sell consumer goods. The

larger dealers generate sufficient income to overcome the seasonal cash flow peaks associated

with agro-input selling.

With the exception of the distributor category, dealer constraints are essentially financial.

Ninety percent of all purchases are for cash, with only three of the large fertilizer companies

providing products to dealers with short-term credit facilities. This burden is, of course,

passed on to farmers, and 40% to 50% of sales to farmers are for cash. The remaining sales to

farmers are on a crop cycle basis, with credit extended to farmers until harvest time and

monthly interest charges of 2-3%. As long as farmers have a good crop, dealers indicated that

cash repayments are always made. There is an obvious need for formal affordable credit

products matched to dealer and farmer needs.

The second major constraint for agro-dealers is the lack of product knowledge and capacity to

provide advice to farmers. Dealers reported that farmers obtain their information on product

use from other farmers and through observation of neighbors’ fields. This reinforces the

findings of the recent farmer survey.3 As a result, more than 70% of farmers know what they

want when purchasing fertilizer but not necessarily the correct balance of plant nutrients. The

lack of farmer understanding of balanced crop nutrition is apparent when one considers the

product mix that they buy from dealers. The estimated average total fertilizer nutrient ratio of

N to P2O5 to K2O is 5.5:1.3:1, and in the Ayeyarwaddy region this ratio is 9:2:1. In

comparison the Department of Agriculture Research (DAR) recommends a ratio of

3 Report on Chemical and Organic Fertilizer Knowledge, Concerns and Market in Relation to Interests of Small

Holder Farmers in Myanmar, Food Security Working Group, May 2015.

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approximately 3:2:1. The overuse of nitrogen especially as urea is very apparent, and the

need for farmer and dealer training in this area is paramount.

Dealers recognize their lack of product knowledge, and 80-100% of all medium and large

dealers, respectively, requested training in this area, especially for fertilizers and pesticides.

There is also a strong desire to receive training in agro-input marketing and business

management. The small dealer category has a much lower desire for training.

It is recommended that the FSI project concentrates on the large- and medium-sized agro-

dealers in the three regions mentioned above. It is estimated that there are 600 of these agro-

dealers, and this should be within the capacity of the project to provide training. The focus

can be narrowed by selecting dealers with the largest number of sub-dealers. Two major areas

of training are recommended: product knowledge, especially for fertilizers and pesticides,

and agro-input marketing and business management. Where possible training should start

with dealers and then follow up with both dealers and farmers in joint training sessions.

About 20% of all dealers indicated interest in manufacturing urea briquettes. The premises of

most dealer shops are too small to accommodate briquette manufacture, so interest was

confined to those large- and medium-sized dealers who have warehouses. From the survey

analysis of fertilizer sales, it would be prudent to concentrate manufacture with these dealers,

especially those with established business relations with a large number of sub-dealers.

The opportunity exists for the FSI project to have a considerable impact on the fertilizer

dealer network and, by implication, on farmers.

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Fertilizer Sector Improvement Project

Fertilizer Dealer Survey

Introduction

This survey of a random sample of agro-input dealers in the Ayeyarwaddy, Bago and Yangon

regions of Myanmar was conducted in March 2015 as a follow on to a rapid fertilizer policy

study conducted in August 2014 under the Fertilizer Sector Improvement project (FSI)

implemented by the International Fertilizer Development Center (IFDC) in Myanmar, with

funding by the United States Agency for International Development under the award number

AID-OAA-10-11—00003-00 (IFDC Grant). This project is essentially designed to introduce

balanced use of fertilizer with urea deep placement technology into Myanmar for improved

production and income within rice-based cropping systems for smallholder farmers, and it is

geographically confined to the aforementioned three regions.

The purpose of this study was to survey a representative sample of agro-input dealers in the three

FSI project regions of Myanmar in order to characterize these businesses and segment them by

resource level, capabilities and inputs knowledge. These dealers are integral to the objectives of

the FSI project. Their capacity to provide factual technical and economic information to their

farmer customers on the appropriate selection of inputs, such as fertilizer, seeds and pesticides,

for crops is essential to meet the FSI objectives. Identification of training needs is a prime output

of the survey. In addition, identification will be made of some of these dealers who could

produce urea briquettes for the Urea Deep Placement (UDP) market development program of

FSI. Full details of the Scope of Work (SOW) are provided in Annex 7.

The Fertilizer Sector of Myanmar

Myanmar has an open competitive fertilizer market dependent on imports for over 80% of the

total market demand, estimated at between 1.2 and 1.4 million product tons per annum. The

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market is dominated by imports from China, entering mainly through Muse in Shan State, and is

dominated by urea use.

Domestic manufacture of fertilizer is restricted to urea produced in three operating plants of

small annual capacity by modern standards of 500-600 mt per day. Annual total production is

around 200,000 mt urea as shown in Figure 1.

This low production is caused by intermittent natural gas supply that creates frequent plant shut

downs and affects physical product quality. In a carry-over from previous times when all

domestic urea was allocated to regions and states based on recommendations from Ministry of

Agriculture and Irrigation (MOAI) officials, domestic urea is sold to permit holders that include

contract farm groups and individuals. The system of permits is opaque and reportedly is subject

to rent-seeking by some permit holders who re-sell either their permits or product allocations to

dealers.

Myanmar has no comparative advantage in fertilizer production despite having natural gas as a

resource for ammonia production. Myanmar is geographically located next to the huge Chinese

fertilizer manufacturing industry that can compete with fertilizer ocean imports to Myanmar to

within 200 miles of Yangon. Also bordering Thailand with a significant manufacturing capacity,

particularly for NPK compound fertilizer, the sector should continue to be reliant on imported

fertilizer.

In November 2014, there were 124 licensed private sector fertilizer manufacturers according to

the Land Use Department (LUD) of MOAI. However, of these manufacturers, only 50 produce

organic fertilizer and 10 produce only gypsum. Of the remaining 64 producers, only 13

companies are both substantial manufacturers of compound and blended fertilizers and also

importers of substantial quantities of fertilizer. One company has commenced production of

monoammonium phosphate (MAP) in Mandalay. Another company ceased granulation of NPK

fertilizers due to price competition from imports. The other licensed manufacturers are very

small operations.

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Figure 1. Domestic Urea Production and Imported Fertilizer Sites for Myanmar

The private sector fertilizer market is highly competitive within the country and in sourcing

imports from China and a handful of other regional countries. There are 270 registered fertilizer

importers and distributors, of which around 80 are serious agro-input suppliers. The remaining

numbers are general traders who opportunistically import fertilizer for resale when the occasion

arises. The large importers are estimated to account for about 90% of all fertilizer imports. Some

of these large companies that have established distribution networks provide advisory and sales

services to dealers but feel threatened by the low-cost price competition from the general traders

and have expressed desires to have them banned under the Fertilizer Law which governs the

operation of the industry.

Import Supply

Fertilizer is imported in two ways: overland by truck or sea through Yangon port. The majority

of overland imports, consisting mainly of urea, triple superphosphate and NPK compounds from

China, enter through the border crossing at Muse in Shan State. Products from Thailand are

imported through Myadwaey in Kayin State and fertilizer from India through various border

crossings in the northwest.

4

There are no published data on imports by the Customs Department, and total imports are

estimated to be almost 1,000,000 mt per annum. Approximately 900,000 mt enter the country

from China and small quantities from Thailand and India. Approximately 150,000 mt are

imported through Yangon port. Nearly all product is imported in bags, although some container

shipments of bulk product are occasionally imported.

Fertilizer supply constraints include: Yangon port vessel size restrictions and port congestion,

high inland freight costs, international price volatility, variable quality of Chinese urea and NPK

fertilizers, variable natural gas supply for domestic urea production and subsequently poor

physical quality of this urea, trade credit availability and the absence of published customs data

that creates uncertainty for importers.

Supply advantages for Myanmar include the access to Chinese urea at border prices below

international norms, access to a wide range of products on the international market, including

imports from Thailand, Malaysia, Vietnam, the Arabian Gulf and India, and well-established

major importers.

Total Fertilizer Supply and Demand

Official data published by the United Nations Food and Agricultural Organization4 reported a

total nutrient market of 129,585 mt of nitrogen (N), phosphate (P2O5) and potash (K2O) for

2011-12 based on data supplied by the Government of the Union of Myanmar.

Careful estimates were made of the 2014 market based on information received from major

importers during assessment discussions in August 2014. These estimates are presented in

Table 2. The total market is estimated at 1.14 million product tons containing approximately

520,000 mt of primary nutrients, a fourfold increase over the FAOSTAT for 2011-12. This is

probably due in part to the non-reporting of customs data and other limitations in market

information reporting. Earlier estimates of fertilizer use based on official macro data5 indicate

4 FAOSTAT, 2012.

5. FAO Stat 2014

5

nutrient applications per cultivated hectare at 4 to 5 kg. These current estimates indicate a much

higher use of 26 kg per hectare. Compared to other south and south-east Asian countries, this is

still very low use.

The estimated market for 2014 (Table 1) is dominated by urea, which accounts for 61% of the

total product, 87% of the total nitrogen and 62% of the total nutrients. In part, this reflects the

dominance of fertilizer use on rice and very unbalanced fertilizer applications by farmers. Due to

documented evidence of traders mixing granulated single superphosphate (GSSP) containing

18% P2O5 with granulated triple superphosphate (GTSP) containing 46% P2O5 and selling as

GTSP, the registration of GSSP was withdrawn in 2013, and its import and use were prohibited.

Stocks were still sold during 2014.

Table 2. Estimate 2014 Fertilizer Market in Myanmar

Product mt Percent of Total

Domestic urea 200,000 14.9%

Imported urea 600,000 44.9%

Ammonium sulfate (AS) 1,750 0.13%

Calcium ammonium nitrate (CAN) 740 0.06%

NPK compounds 400,000 29.9%

Ammonium phosphates (DAP and MAP) 7,000 0.52%

Granular single superphosphate (GSSP) 2,000* 0.15%

Granular triple superphosphate (GTSP) 90,000 6.7%

Rock phosphate 7,500 0.6

Muriate of potash (MOP) 20,000 1.5%

Foliar fertilizers 4,000 0.3%

Gypsum 5,000 0.35%

Organic fertilizers 5,000 0.35%

Total product 1,337,990 100%

Nitrogen 429,610

Phosphate 105,945

Potash 58,150

Total nutrients 519,565

*Product import banned in 2014.

The sector is regulated through the Fertilizer Law (The State Peace and Development Council

Law No. 7/2002), administered by the LUD. This is fairly comprehensive, but it suffers from

6

many deficiencies that need to be addressed, including poor enforcement of quality standards and

labeling.

Fertilizer use by farmers is insufficient for optimum yields and farmers generally have little

knowledge of the best agricultural practices and plant nutrition requirements. The Food Security

Working Group6 observed that “farmers’ knowledge regarding fertilizer and fertilizer use in

general, is limited. Farmers mentioned that the way they determine what type and how much

fertilizer they use mainly depends on what they see around them in the village. They look at what

other farmers are using or what they were doing in the past season.”

Fertilizer Distribution

Distribution operations are essentially partitioned between imports entering through Yangon port

and imports entering from China through Muse from where product is distributed either directly

to northern area districts or to Mandalay. Most transport is by truck, and transport costs are

relatively high. Some use of rail transport is made to move product from Muse to Yangon, and

river transport is low cost but slow from Yangon to the lower delta region. Figure 2 illustrates a

schematic of the distribution networks.

Figure 2. Schematic of Myanmar Fertilizer Distribution Channels

6 FSWG, May 2015. Op cite.

7

The Fertilizer Value Chain

A recent survey7 provided an average value chain for urea imported from China, transported to

Mandalay and distributed to a dealer in the Mandalay region. This is presented in Figure 3. Total

transport costs amount to $60/mt or 13% of the retail price. More important are the margins, or

markups, for importer, distributor and retailer. The importer and distributor each show a 4.5%

markup, which if combined by one importer/distributor amounts to 9% total markup. By

comparison, the retailer markup is only 2.4%. Given that the turnover for importers/distributors

is vastly more than for a retail dealer, this is regarded as excessive and illustrates why

opportunistic general traders are attracted to fertilizer importation.

Multiple handling and storage of fertilizer imports cannot be avoided because stocks have to be

built in advance to meet peak seasonal demand. However, economies of scale for the larger

importer/distributors are available. For example, one firm reduces the transport cost to Mandalay

down to $20/mt, and rail freight (available because of the large tonnage shipped) to Yangon is

achieved for less than the road freight from Muse to Mandalay.

7 Hnin Yu Lwin, Theingi Myint, Shwemar Than, Nay Myo Aung, Cho Cho San, Tin Htut. 2014. Role of

Fertilizer in Transforming Agriculture in Myanmar, Department of Agricultural Economics, Yezin

Agricultural University, Yezin, Nay Pyi Taw, Myanmar.

8

Figure 3. Chinese Urea Value Chain to Mandalay Region

The Agro-Dealer Survey

The survey was conducted between March 1 and April 7, 2014. The objective was to provide

information on a representative sample of agro-dealers in the three regions covered by the FSI

project in order to provide information on the intervention strategies that would best serve the

agro-dealers, farmers and the FSI project objectives. The survey was conducted by an IFDC

consultant assisted by a translator and two enumerators. Valued assistance was provided by FSI

project team members.

64.44%

68.75%

80.17%

81.68%

86.21%

88.79%

90.30%

94.83%

96.34%

97.63%

100.00%

0.00% 10.00% 20.00% 30.00% 40.00% 50.00% 60.00% 70.00% 80.00% 90.00% 100.00%

fob Cost

Clearance Charges

Transport to Mandalay

Finance and Other Costs

Margin

Transport to Wholesaler

Storage and other costs

Margin

Transport to Retailer

retailer costs

Retail Margin

US $/mt11 (2.4%)

6

7

21 (4.5%)

7

12

21 (4.5%)

47

53

20

299

$ 464Retail Price

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Method

A comprehensive list of registered fertilizer dealers in the three regions as of November 2014

was obtained from the LUD, as summarized in Table 3.

Table 3. Registered Fertilizer Dealers in Myanmar

Region/State

Number of

Registered Fertilizer Dealers

Katchin State 68

Kayah State 20

Kayin State 61

Chin State 0

Sagaing Region 231

Tanintharyi Region 36

Bago Region 421

Magway Region 350

Mandalay Region 474

Mon State 206

Rakhaine State 70

Yangon Region 178

Shan State 344

Ayeyarwaddy Region 634

Total 3,093

Source: Land Use Department, MOAI, November 2014.

These lists were sorted by gender of the registrant. The percent of female- and male-owned

businesses were calculated, and the sample numbers for each gender group were derived based

on a 5% sample and a further 5% for an additional list of spare potential participants. A 5%

sample was chosen based on time considerations in which to conduct the survey. All male-

owned establishments for each region were allocated random numbers using Excel® software

and then resorted in ascending random number order. This was repeated for the female-owned

establishments. The first and second 5% samples were selected from the random number sorted

lists of establishments for both genders, starting with the lowest random number assigned. The

sample numbers for each region by gender are shown in Table 4.

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Table 4. Survey Sample by Gender and Region

Region Ayeyarwaddy Bago Yangon Total

Gender Male Female Male Female Male Female Male Female

Owners 560 165 307 106 147 56 1014 327

Percent 77.24% 22.76% 72.4% 27.6% 74.3% 25.7% 75.6% 24.4%

Sample 28 8 15 5 7 4 52 15

Managers 24 12 6 14 7 4 43 24

Percent 66.7% 33.3% 30.0% 70.0% 63.6% 36.4% 55.2% 44.8%

Sample 24 12 6 14 7 4 43 24

However, when the gender of the managers were considered there were significant differences

from ownership gender in the Ayeyarwaddy and Bago regions. For the three regions overall,

female managers represented almost 45% of the total managers compared to 24% for female

ownership. It was therefore decided to select samples based on the gender of the managers. A

total of 67 agro-dealers in the three regions were surveyed.

Survey Forms

Survey forms were field tested and modified to reflect the attributes of the dealers and the survey

objectives. Questions on frequency of all official government visits to agro-dealers were dropped

except for LUD and MOAI extension department visits related to quality control and fertilizer

sampling. Questions on sales for 2012 and 2013 sales were abandoned when it was obvious that

no formal records were maintained by most dealers. The final survey form is shown in Annex 1.

Information on fertilizer, pesticide and seed sales for 2014 were recorded together with purchase

and selling prices. Sales data for fertilizer appeared to be accurate to the nearest 10-20 50-kg

bags, but data on pesticides and foliar fertilizers were more suspect. Seed data was infrequent

and variable in quality. One set of questions on constraints to business were difficult to

comprehend by most dealers who interpreted the questions as questions about constraints

imposed by government. Elaboration of the questions had to be made by the enumerators.

It was also obvious that the agro-dealers had little knowledge of the crop areas in their respective

locations, and any attempt to obtain such information was abandoned and replaced by listing the

main crop markets in the local market area for each dealer.

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The survey questions also inquired about training wants, and after a brief presentation on urea

deep placement technology (UDP) questions were asked as to whether the dealers would be

interested in selling and/or manufacturing urea briquettes.

In addition, the survey recorded:

1. Details of ownership and manager and employees by gender.

2. Land and mobile phone numbers and e-mail addresses (which were minimal in number).

3. Number of stores owned, storage capacity for fertilizer in stores and warehouses.

4. Number of sub-dealers supplied.

5. Number of farmer customers.

6. Number of local competitors.

7. Purchasing and processing activities of farm products.

8. Summaries of supply companies’ sales terms and support provided.

9. Farmer knowledge and sales terms to farmers.

Survey Method

The survey was conducted between March 3 and April 3, 2015. During the first three weeks, the

survey team consisted of two enumerators, the IFDC consultant and a translator. Where possible

due to the convenient location of two randomly selected survey participants, the enumerators

conducted interviews on their own after the first week, allowing for faster coverage of the

survey. In the final week, the enumerators completed the survey alone in the southern

Ayeyarwaddy region. Survey forms were completed in both Myanmar by the enumerators and

English by the consultant with translator.

Apart from two instances where it was impossible to travel to the dealer locations in the survey

vehicle, all randomly selected dealers were located. However, the LUD lists appeared to be

outdated in many instances, and randomly selected dealers were found to be out of business and

were replaced with others of the same gender from the random list of spares.

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In the Yangon region, it became clear that the random sample included dealers located within the

urban area of Yangon city. These dealers were small shops selling a few garden fertilizers and

chemicals or were large regional distributors or importers. It was decided to eliminate all

randomly selected agro-dealers registered as fertilizer sellers that were located in the city area

and replace them with agro-dealers from the random selection of agro-dealers in rural areas of

the Yangon region. Complete cooperation was achieved from the interviewed agro-dealers in all

regions.

For logistical reasons, the Bago region was split into east Bago and west Bago, but the data were

analyzed for the whole region.

Analytical Methods

The data were analyzed using Excel® spreadsheets with a concentration on fertilizer purchases,

sales, margins and storage capacity. The data were sorted by gender of the managers and by

fertilizer sales volume. Four categories were defined in this latter separation: annual sales over

100,000 50-kg bags; sales between 20,000 and 100,000 bags; sales between 1,000 and 20,000

bags and sales under 1,000 bags. These four categories were defined as district distributors, large

dealers, medium dealers and small dealers, respectively. All data was summarized and analyzed

at regional levels and in total.

Certain correlations were tested such as annual sales volume and storage capacity, and the annual

total markup from fertilizer sales in 2014 was estimated from the survey data for each category.

A simple structural analysis was completed to estimate the total number of each class of dealers

in each region.

Results

Gender Comparisons: Overall, the sample population of agro-dealers owned by females was

approximately 22%, while the proportion managed by females was 36%. Data were analyzed,

therefore based on the gender of the managers as it is postulated that the services provided to

farmers may reflect the manager’s ability rather than ownership.

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Table 5 shows a comparison of major characteristics between female- and male-managed agro-

dealerships in the survey sample and averages for the total sample. The only significant

differences are for annual sales and storage capacity. The male-managed group includes two

large (over 100,000 bag sales per annum) and when these are excluded the average sales data for

this group falls to 9,039 bags, which is 29% higher than the average female-managed agro-

dealership. Importantly, the female-managed agro-dealers reported a similar level for farmers

asking advice, which is interpreted as a reflection of knowledge level of the manager rather than

any gender bias. There is no significant difference in the number of stores owned, although the

size of stores as measured by the fertilizer storage capacity at the stores is much lower for

female-managed stores in the Ayeyarwaddy and Bago regions. The reverse is true in the Yangon

region. A high proportion of the dealers sell seeds (88% of the total for both genders) in addition

to fertilizers. However, most of the seeds are small packets of vegetable seeds. Just under 50%

sell pesticides, albeit in small volumes and package sizes, and around 55% of all agro-dealers

sell small tools, mainly spraying equipment. Approximately one-third of the agro-dealers sell

small farm machines, such as small cultivators, but none surveyed handle large farm machinery.

Animal feed and veterinary product sales are limited to less than 7% of the stores. There is a

significant difference between regions regarding the sale of consumer goods and non-agricultural

goods such as construction materials, fuel and oil. Approximately 40% of agro-dealers in the

Ayeyarwaddy region and 15% in the Bago region sell non-agro-inputs, and in the Yangon

region, none of the survey respondents sold these items. The explanation may be that the

isolation of many stores in Ayeyarwaddy provided an opportunity to stock other items, and in the

Yangon region, competition from others and the closeness of the Yangon city markets precluded

the opportunity to trade in these items.

14

Table 5. Major Characteristics of Agro-Dealers by Management Gender

Characteristic

Ayeyarwaddy Bago Yangon

Total for

Three Regions

Female Male Total Female Male Total Female Male Total

24

Female

43

Male Total

Ownership 22.22% 77.78% 100% 30% 70% 100% 27% 73% 100% 22% 78% 100%

Manager gender 33.33% 66.67% 100% 35% 65% 100% 45% 55% 100% 36% 64% 100%

Education (years) 11.5 12.09 11.89 12 11 11.3 13.4 12.7 13 12.04 11.82 11.89

Business experience 15.25 9.21 11.22 10.3 13.1 12.1 6.4 13 10 11.96 10.91 11.28

Female employees 0.5 0.3 0.37 0.3 1 0.75 1.8 1 1.36 0.71 0.62 0.65

Total employees 1.67 1.42 1.5 0.6 3.5 2.45 2.6 1.7 2.09 1.54 2.07 1.88

No. Stores 1.33 1.08 1.17 1 1.8 1.55 1.6 1 1.27 1.29 1.3 1.3

Storage Capacity (bags) 348 1290 976 181 2,350 1,591 538 308 413 339 1474 1,067

Warehouse availability 42% 21% 28% 43% 54% 50% 20% 17% 18% 38% 30% 33%

Warehouse Capacity (bags) 1,750 1,817 1,794 771 2,646 1,990 140 500 336 1129 1884 1,613

Re-bag in small bags 83% 71% 75% 71% 69% 70% 40% 0% 18% 71% 58% 61%

Sell to sub-dealers 58% 46% 50% 71% 69% 70% 60% 50% 55% 54% 47% 52%

No. of sub-dealers 3 4 3.9 5 17 12.9 22 3 11.7 7.13 3.91 6

Sell to dealers (wholesale) 50% 29% 36% 43% 62% 55% 40% 67% 55% 38% 33% 37%

Total fertilizer sales (bags) 9,400 7,365 8,043 4,510 61,372 41,470 4,748 4,578 4,655 7,005 23,304 17,465

No. of farmer customers 128 160 149 226 1,023 744 2,504 337 1,322 651 446 519

No. of competitors 9 13 11.6 7 5 5.4 3 5 4.45 7 9 9

Farmers know wants 75% 71% 72% 82% 58% 67% 57% 77% 68% 73% 68% 70%

Farmers ask advice 36% 34% 35% 39% 52% 47.50% 26% 31% 29% 35% 39% 38%

Sell seed 25% 42% 36% 57% 62% 60% 100% 100% 100% 88% 88% 88%

Sell pesticides 58% 50% 56% 57% 77% 70% 40% 50% 45% 38% 53% 48%

Sell tools 42% 38% 39% 57% 54% 55% 60% 50% 55% 58% 53% 55%

Sell farm machinery 8% 4% 6% 0% 8% 5% 60% 50% 45% 33% 28% 30%

Sell animal feed 8% 0% 3% 0% 15% 10% 20% 0% 9% 8% 7% 7%

Sell veterinary products 0% 4% 3% 0% 0% 0% 0% 0% 0% 4% 0% 1%

Sell consumer goods 33% 42% 39% 14% 15% 15% 0% 0% 0% 4% 7% 6%

Buy farm produce 33% 42% 36% 14% 31% 25% 0% 17% 9% 25% 30% 28%

Process farm produce 21% 25% 22% 14% 0% 5% 0% 0% 0% 17% 12% 13%

It should also be noted that about one-third of agro-dealers in the Ayeyarwaddy region purchased

crops from farmers and 25% in the Bago region. Processing of crops by agro-dealers was even

more limited and consists mainly of paddy and black and green gram seed cleaning for re-sale.

Few agro-dealers in the whole survey accepted crops as payment for agro-inputs. In regard to

agro-dealer opinions on farmers, it can be seen from Table 4 data that dealers think that

approximately 70% of farmers know what agro-inputs they want to purchase, and less than 40%

ask for advice.

The main characteristic of the sample survey is that the agro-dealers are for the most part

“stockists” and sellers of agro-inputs, and they are unable or unwilling to provide full technical

15

service to their customers. A more detailed examination of the survey data by fertilizer sales

volume segregation reveals a clearer picture.

Correlation Analysis

Prior to the description of the results by this dealer, size classification correlation analyses with

annual sales volume were conducted using data from the total sample of small, medium and large

agro-dealers. The results of the correlation analysis are presented in Table 6. Annual fertilizer

sales volumes were examined with:

1. The number of sub-dealers served.

2. The number of direct farmer customers.

3. The multiple correlation with 1 and 2.

4. The combined storage capacity of shops and warehouses owned by each agro-dealer.

5. The number of local competitors.

Table 6. Correlation Results for Annual Sales Volumes

Sales Volume and: Correlation Coefficients

Number of sub-dealers 0.31

Number of direct farm customers 0.30

Number of sub-dealers and farmer customers 0.34

Combined shop and warehouse storage 0.72

Number of competitors 0.003

As would be expected, there is a slightly stronger correlation between sales volumes and the

number of sub-dealers and farmer customers compared to the number of farmer customers alone.

The use of sub-dealers expands the number of farmer customers served by each main dealer. The

multiple correlation coefficient, however, is weak. The higher correlation between sales volume

and combined storage capacity provides a guide to agro-dealer selection for effective

development interventions. There is no correlation between annual sales volume and the number

of local competitors, indicating that in spite of the high degree of competition individual

relationships of agro-dealer managers with farmers and sub-dealers are as important as

availability of products and services.

16

Fertilizer Sales Volume Analysis

The distribution of agro-dealers in the survey by annual fertilizer sales volume of 50-kg bags is

illustrated in Figure 4. Two survey respondents are omitted from this data as both had annual

sales of over 150,000 bags, almost five times higher than the highest annual sales volume among

the other 65 surveyed agro-dealers. These two agro-dealers are classified as area distributors, and

both were located in the Bago region. The remaining 65 agro-dealers are classified into three

groups: 22 Small – annual sales of less than 1,000 bags; 33 Medium – annual sales of between

1,000 and 20,000 bags; and 10 Large – annual sales of between 20,000 and 100,000 bags.

Detailed analysis of the data segregated into these three groups plus the “Area Distributors”

group.

Figure 4. Distribution of Agro-dealers by Annual Sales Volume

Distribution of Annual Fertilizer Sales per Agro-Dealer

17

Sales Volume Analysis

The segregated numbers of agro-dealers in each region classified by fertilizer sales volume are

presented in Table 7. Approximately 50% of agro-dealers are classified as medium-sized with

annual bag fertilizer sales of between 1,000 and 20,000 bags and an average of 5,444 bags. It

should be noted that foliar fertilizer sales are not included as the data from dealers was very

vague, although nearly all dealers sold a quantity of these products. Details of the major

characteristics by dealer classification are presented in Table 9 and general descriptions follow.

Table 7. Number of Surveyed Agro-dealers per Region Classified by Fertilizer Bag Sales

Volume

Ayeyarwaddy Bago Yangon Total

Distributor 0 2 0 2

Large 6 3 1 10

Medium 18 9 6 33

Small 12 6 4 22

Total 36 20 11 67

The two distributors with average annual sales of over 153,000 bags have a small direct farmer

clientele and the largest number of sub-dealer clients. They are able to take advantage of volume

purchases from major importers and have established relationships with these firms. Although

they sell a range of agro-products, the main business is fertilizer distribution in the East Bago

region substituting for the Yangon and Mandalay fertilizer markets. They have little direct

contact with farmers (average farmer clients 135) and regard their businesses as accumulators

and suppliers of fertilizer to large- and medium-sized dealers and some sub-dealers.

Large dealers are usually located in larger market towns, and with annual average sales of 25,500

bags, they also have the largest number of farmer clients (1.200) plus sales to 10 sub-dealers on

average. Some, but not all, have strong relationships with one or two major importers. The total

average storage capacity for these dealers was recorded as larger than the district distributors due

to four of the ten dealers having large warehouse capacity associated with non-fertilizer

activities.

18

The most numerous medium-sized dealers with average annual fertilizer sales of 3,820 bags have

a direct farmer base of 600 farmers each and also serve on average six sub-dealers. Few of these

medium-sized dealers receive support or volume discounts from the major fertilizer importing

and production firms.

The small dealer classification (sub-dealers) with average annual sales of just 336 bags are

generally small businesses in village or village tract locations who respond to local farmer

demands and are able to contact medium and large dealers for fertilizer supplies on an as needed

basis. They receive little or no support from the large fertilizer importer/manufacturing firms.

When located near fertilizer markets with a concentration of regional distributors, supplies can

be obtained from these markets rather than from other dealers. Sub-dealers just respond to farmer

requests at a very local level, and although they are small and have little agro-input knowledge,

they provide an essential “last mile” supply service to farmers in remote locations.

Although 20-30% of large, medium and small agro-dealers sell farm machinery, the equipment

sold is all of a small size such as small motorized cultivators. None of the agro-dealers in any

category handled large farm machinery or were located near tractor and other large farm

machinery stores.

A comparison of fertilizer sales to total storage capacity for large, medium and small agro-

dealers is presented in Table 8. It shows that the large and small agro-dealers have a sales to total

storage capacity of around 2.8, and the medium agro-dealers have turnover twice this level with

a sales to storage ratio of 5.4. The small dealers are entirely dependent on the storage capacity of

their stores.

Table 8. Storage Capacity and Average Sales Comparison

Class

Sample

No.

Store

Capacity

(50-kg bags)

Warehouse

Capacity

(50-kg bags)

Total

Storage

(50-kg bags)

Average

Sales

(50-kg bags)

Sales-to-

Storage

Ratio

Large 10 4,980 8,150 13,130 36,852 2.81

Medium 33 511 503 1,014 5,444 5.37

Small 22 138 0 138 392 2.83

19

Agro-Dealer Licensing

Agro-dealers selling more than 50 bags of fertilizer per year have to be licensed with the LUD.

The licenses have to be renewed every three years for a nominal fee. In practice, most

applications for a fertilizer retail license are approved by the local office of the MOAI extension

service. Only minimal requirements in terms of shop space are necessary, and there are no

guidelines on the maximum number of licensed agro-dealers in any location. This leads to a large

number of small agro-dealers. For pesticide sales, a separate license is required, and applicants

have to undergo a one day training program. Far more intensive guidelines should be required for

both fertilizer and pesticide retail licenses.

20

Table 9. Major Characteristics of Survey Sample Agro-Dealers by Size Classification

Characteristic

2 Distributors 10 Large 33 Medium 22 Small

Average

for

67 Dealers

(Over

100,000 bags)

(20,000 to

100,000 bags)

(1,000 to

20,000

bags)

(Under

1,000 bags)

Ownership 0% 20% 24% 23% 22%

Manager gender 0% 40% 33% 41% 36%

Education (years) 10.5 12.1 12.5 11.04 11.89

Business experience (years) 7.5 16.6 9.5 11.86 11.28

Female employees 1 1.1 0.66 0.41 0.65

Total employees 6.5 4.2 1.52 0.95 1.88

No. stores 1 1.8 1.3 1.09 1.3

Storage capacity (bags) 900 4,980 511 138 1,067

Warehouse availability 100% 80% 36% 0% 33%

Warehouse capacity (bags) 5,000 8,150 503 0 1,613

Total storage capacity/dealer (bags) 5,900 13,130 1014 138

Re-bag in small bags 100% 70% 67% 0% 61%

Sell to sub-dealers 100% 70% 52% 41% 52%

No. of sub-dealers 21 10 6 2 6

Sell to dealers (wholesale) 100% 80% 33% 18% 37%

Total fertilizer sales (bags) 306,700 255,519 180,139 7,389 10,379

Fertilizer sales per dealer (bags) 153,350 25,552 5,459 336 10,379

No. of farmer customers 135 1,207 599 123 519

No. of competitors 5 9 8 9 9

Farmers know wants 88% 74% 66% 72% 70%

Farmers ask advice 40% 43% 38% 35% 38%

Sell seed 100% 90% 91% 82% 88%

Sell pesticides 100% 40% 52% 41% 48%

Sell tools 100% 50% 58% 50% 55%

Sell farm machinery 0% 20% 36% 27% 30%

Sell animal feed 50% 10% 6% 5% 7%

Sell veterinary products 0% 10% 0% 0% 1%

Sell consumer goods 0% 0% 9% 5% 6%

Buy farm produce 50% 40% 33% 14% 28%

Process farm produce 0% 20% 15% 9% 13%

Total Fertilizer Sales by Dealer Size

Details of fertilizer sales in 2014 were recorded for each dealer together with delivered prices

into store and selling prices. These are summarized for the three regions in Annex 2, Tables 2.1

to 2.4 for the four classes of dealers.

The two distributors selling more than 100,000 bags had over 90% of sales as urea, only 3% as

NPK fertilizer and smaller quantities of straight phosphate fertilizer. Surprisingly, neither

21

distributor sold muriate of potash in 2014, and no reason was given for this situation. The overall

average markup for sales was 5.12%. This represented for each a total annual markup of K

270,970,000, or $270,970. In addition, one business had a large animal feed business. One dealer

purchased paddy and gram from farmers for resale but did not process these. Sales of seeds,

pesticides and small tools rounded out the business activities, but these were minor in

comparison to fertilizers.

Urea sales accounted for 60% of total fertilizer sales for the ten large dealers and NPK fertilizers

for a further 23% and 13% for straight phosphate and potash fertilizers. The overall average

markup for bag fertilizers was 5.49%, resulting in an average annual markup per dealer of K

30,311,817, or $30,317.

The product mix for the 33 medium-sized dealers was more balanced than for the large dealers,

with urea sales accounting for 50% of total sales, NPK fertilizers for 30% and straight phosphate

and potash for 11%. The average markup on fertilizer sales was 6.02% annual fertilizer markup

income K 6,003,412, or $6,003.

For the 22 small dealers (or sub-dealers) selling less than 1,000 bags per annum, the product mix

was even more balanced, with urea accounting for 48% of total sales, NPK fertilizer for 22% and

straight phosphate and potash fertilizers for 17%. The average markup on all bagged fertilizer

was 5.66%, resulting in an average total annual markup of K 316,433, or $316.43.

Markup income is not gross income for the agro-dealers. Finance, labor, property costs and other

business expenses have to be met from the markup income, and these may account for up to 30%

to 40% of the markup income.

The markups by agro-dealers on domestic and imported urea, representing the bulk of fertilizer

sales, varied between 5.4% and 6.1% for domestic urea and between 5.3% and 6.9% for

imported urea, with the largest markups being made by the large dealer group and the lowest by

distributors. These agro-dealer percent markups in the South are higher than those reported in

Figure 3 for retail markups on imported Chinese urea in the Mandalay region, which averaged

22

around 4.0% and left an estimated net margin for retailers of 2.4%. However, the monetary agro-

dealer markups per bag are similar to those reported in this survey.

Total Fertilizer Sales for Ayeyarwaddy Region by Dealer Size

The results are presented for the Ayeyarwaddy region in Annex 2, Tables 2.1 to 2.4. In each

series of tables, the total sales and averages per dealer are presented for the total region and for

each of the dealer size groups.

For the region as a whole, the most popular fertilizers were urea, 15-15-15, 10-10-5, GTSP and

muriate of potash, with 92%, 61%, 53%, 67% and 67% of all dealers, respectively, selling these

products. On average, the markups on all these products were slightly less than 5%. Domestic

urea was priced at 19% below imported urea reflecting both its lower ex-factory price,

transportation costs and poorer quality. It should be noted that the ex-factory price for domestic

urea was reported to be K 14,500 per 50-kg bag to permit holders, and the average dealer

purchase price of K 15,832 per bag includes transport cost and in some cases, a markup from the

permit holders who supplied the dealers. Urea accounted for 58% of all bagged fertilizer sales in

the region in 2014, followed by 10-10-5 (5%) and GTSP (4%). The highest markup by dealers

was on foliar fertilizers at 17%, but the quantity relative to bagged fertilizer was small and is not

counted in the totals.

NPK fertilizers other than those listed in the data tables were sold by 47% of the dealers,

accounting for a mere 2% of bagged sales.

The average fertilizer sales (excluding foliar fertilizers) for the six large dealers were 27,710

bags compared to 5,416 bags for the 18 medium-sized dealers and 986 bags for the 12 small

agro-dealers. Urea sales dominated the product mix in each size group, and large and medium-

sized agro-dealers had approximately 16% of sales as NPK fertilizers compared to 20% for the

small dealers. The average markups per bag for all bagged fertilizer sales were K 828 (5.91%)

for large agro-dealers, K 888 (4.87%) for medium agro-dealers and K 921 (5.33%) for small

dealers. The resulting total markup revenues for the large, medium and small dealers were

$6,456, $4,801 and $861, respectively. Although the small agro-dealers perform a useful service,

23

they cannot be expected to develop markets. The large- and medium-sized agro-dealers servicing

many sub-dealers offer the opportunity for FSI interventions to have an impact.

Bago Region

For the 20 dealers in the Bago region, urea sales comprised 82% of the total bagged fertilizer

sales, NPK fertilizers 10% and straights (phosphate and potash) 5%. The extreme imbalance of

fertilizer nutrients is unfavorably biased by the sales of the two distributors, where urea sales

recorded 96% of sales, NPKs only 3% and straights 1%. Essentially, these two dealers are

distributors of urea in the greater Bago region. Markups for urea averaged around 5.5% and over

all products 5.12%. Markups on single superphosphate sales averaged almost 17% and may

reflect the shortage of this product after the ban on its further importation.

The distributors reported markups on NPKs ranging from negative 0.6% on 16-16-16 to zero on

15-15-15 but made up for this with other NPKs and GSSP and GTSP. It may be that they were

unable to obtain good purchase prices on NPKs from the major importers compared to favored

dealers who obtained volume discounts from suppliers, although this was not substantiated. In

spite of this, the annual total markup on fertilizers is estimated at $271,122 each.

The three large dealers in the Bago region with average annual fertilizer sales of 53,333 bags had

a far more balanced product mix, with urea sales averaging 39% of total sales, NPKs 26% and

straights 23%. Imported urea markups of 2,000 Kyat per bag averaged 11.1% and were the

highest recorded in the survey. Dealer and farmer preference for imported urea and distance from

domestic factories may have been factors. Again, a high markup on GSSP (17%) and above

average markups on other NPKs, straights, gypsum and organic products resulted in an average

markup of 9.0% and a total annual markup per dealer of almost $29,928.

The nine medium-sized dealers with average sales of 6,000 bags had an even more balanced

product mix. Urea accounted for only 33% of total sales, NPKs 49% and straights 5%. Overall

markup on all bagged fertilizer products was 6.4%, with high levels for SSP, gypsum and

organic fertilizers.

24

The six small dealers with average annual sales of only 325 bags each sold proportionately less

urea (31% of total sales) and more NPKs (53%) and straights (7%). These small dealers in more

remote areas sell products based on local farmer demand, and it appears that a lot of the demand

is for NPKs, especially 15-15-15, in spite of the fact that there is no real agronomic basis for this

nutrient ratio. Overall, these dealers made on average a markup of 4.9% and annual total

markups of only $291.85 per dealer, hardly sufficient to cover operating costs.

Yangon Region

The 11 dealers surveyed in this region averaged 4,655 bags of fertilizer sales each in 2014. The

product mix consisted of 49% urea, 28% NPKs and 17% straights. Average markups ranged

from 4.48% on 16-16-8 to 9.0% on other NPKs and 12.9% on GSSP. Markups on gypsum and

organic fertilizers were 11-12%, and overall the average bag fertilizer markup was Kyat

1,235/bag or 6.5%.

The one large dealer with sales of 21,000 bags in 2014 had a small product range consisting of

urea, three NPKs and GTSP. On all products, a markup of Kyat 600/bag was made, so the

average was only 3.19% markup. This dealer kept markups low specifically because he thought

that his farmer customers were poor and deserved a break. The fertilizer business was run in

conjunction with a large fuel station, and it was not considered important to make a large income

from fertilizers.

The six medium-sized dealers had the normal extensive range of fertilizers for sale and average

annual sales of 4,767 bags each, with a product mix that consisted of 33% urea, 39% NPKs and

19% straights. Average markup per bag was Kyat 1,359, or 5.75%, resulting in annual markup

income of $6,479 each.

The four small dealers with average sales of 403 bags only generated an annual markup income

of $548 from a markup of Kyat 1,362/bag, or 6.65%. Their average product mix was urea 44%,

NPKs 28% and straights 32%.

25

Dealer Fertilizer Sales and Nutrient Ratios

Calculating from the average sales of all medium and small dealers, which better reflect actual

sales to farmers, the average nutrient analysis ratio for N, P2O5 and K2O in 2014 was 5.5:1.6.5:1.

This ratio reinforces the case that excessive nitrogen is being used by farmers. Table 10

illustrates these ratios for the separate regions.

Table 10. Average Nutrient Ratios Based on Fertilizer Sales by Medium and Small

Dealers

Region

Average Fertilizer Nutrient Ratios

Nitrogen Phosphate Potash

Ayeyarwaddy 9 2 1

Bago 3.8 1.3 1

Yangon 4.1 2.5 1

All regions 5.5 1.7 1

Global rice data 4.2 1.3 1

These ratios illustrate the excessive use of nitrogen on rice in the Ayeyarwaddy region. In the

Bago and Yangon regions, the larger proportion of legume crops reduces the nitrogen

applications relative to phosphate and potash, although excessive use of nitrogen on rice in these

regions is also partially reflected in the data. A recent farmer survey8 found that although most

farmers use fertilizer on rice, “less farmers use chemical fertilizer during the rainy season when

they have access to irrigation; only 70.6% as compared to 98% of farmers who don’t have access

to irrigation. During focus group discussions, farmers explained that rice production during the

rainy season is risky, and they don’t like to invest too much in rainy season rice because they

have more reliable return on their investments in the dry season.” The survey also reported that

99.1% of farmers using fertilizer use urea, 59.3% use GTSP, 9.7% use potash and only 5.3% use

compounds. The lack of soil testing services and appropriate fertilizer recommendations based

on agro-economic benefits is woefully absent for farmers.

Dealer Arrangements for Purchasing Fertilizer

Fertilizer marketing is working capital intensive for agro-dealers due to the need to accumulate

stocks at point of sale to meet peak seasonal sales volumes and accommodate mainly cash

8 Op cite.

26

purchase terms from distributors. Most sales to agro-dealers are on a cash with order or cash on

delivery basis. Formal short-term credit which accumulates interest at 2% to 3% per month is

rarely used by agro-dealers. These situations are reflected in the survey data, and there are

differences between the dealer size groups and regions and the supplying companies. Table 11

illustrates that 90% of all purchase transactions by dealers were on a cash basis, and only five of

the larger companies provided credit terms to some of the dealers surveyed.

The main importing/distribution companies are aware of this situation and provide various but

limited purchase and incentive programs for selected agro-dealers. These include volume in-kind

discounts of around 3%, where typically when the dealer orders 100 bags on a cash basis he or

she is supplied with an extra three bags for the same price. Some companies provide stock on a

consignment basis for up to 30 days so that the dealer can sell the product within that time and

then pay the supplier from the proceeds. Some companies provide cash terms that are based on

paying the full account within seven to 21 days, which again provides the opportunity for dealers

to re-sell the product before paying the supplier. All of these arrangements are based on the

credit-worthiness of the individual dealers and from the survey not that common.

Table 11. Sales Terms for All Dealers Surveyed

Companies Bought From

Number of Transaction Types

Total Cash Credit Commission Cash % Credit % Comm %

Awba Group 27 22 5 0 81.48% 18.52%

Golden Lion 13 11 2 0 84.62% 15.38%

Golden Dragon 14 12 2 0 85.71% 14.29%

Diamond Star 30 27 3 0 90.00% 10.00%

Shu San Trading 13 13 0 0 100.00% 0.00%

Soe Moe Mine 6 6 0 0 100.00% 0.00%

Golden Gey Co. 1 1 0 0 100.00% 0.00%

Taung Paw Thar Yeshin Co. 0 0 0 0

Marlarmyaing Company Ltd. 9 9 0 0 100.00% 0.00%

Shwe Arhar Moe Company Ltd. 0 0 0 0

Golden Key Company Ltd. 10 10 0 0 100.00% 0.00%

Other 13 12 1 0 92.31% 7.69%

Total 136 123 13 0 90.44% 9.56%

Table 12 illustrates differences between dealer size groups and regions. Whereas over 90% of all

transactions are for cash in the Ayeyarwaddy and Yangon regions, only 80% were for cash in the

Bago region. This is still a high proportion but may indicate more willingness of suppliers to

27

provide credit to the medium and small agro-dealers in the region. The large dealer group in the

Bago region averaged over 90% cash transactions. In all regions, the larger dealers with greater

financial resources paid cash to avoid the high interest charges charged for short-term credit.

Table 12. Summary of Purchase Terms by Dealer Size and Region

Region Ayeyarwaddy Bago Yangon

Dealer size All Large Medium Small All Large Medium Small All Large Medium Small

Cash % 94 92 90 70 80 93 67 58 92 100 100 70

Credit % 6 8 10 30 20 7 33 42 8 0 0 30

The higher proportions of credit purchases by small dealers in all regions reflects their lack of

financial resources and closer ties as sub-dealers to local agro-dealers, which results in credit

being extended by agro-dealers to some sub-dealers based on knowledge that the sub-dealers

have immediate sales prospects and can repay quickly. The higher purchase prices paid by small

dealers compared to medium dealers is also evident in the survey data for many products (see

Annex tables).

There are no specific formal credit products for agro-dealers, and with over 50% of sales to

farmers made on a crop cycle basis with repayment at harvest time, specific 180 day credit

facilities would be very beneficial for agro-dealers and farmers.

Supplier Support

A simple index of major supply company support was constructed based on the number of

services each company provided to dealers in the forms of technical literature, technical staff

visits, sales visits, farmer meetings and field demonstrations. Some major importer/distributors

such as Shu San Trading Enterprises, the largest importer and distributor of Chinese fertilizer,

provide no support other than sales representative visits, while the five other major

importer/distributors AWBA Group, Golden Lion, Golden Dragon, Diamond Star and Golden

Key provide the most support to dealers. The ranking order does not imply any quality rating,

just the number of survey respondents’ statements of the type of each of the listed services.

Farmer meetings organized by the companies are seen by the dealers as effective promotions and

are more numerous than field days at demonstration plots, although the surveyed agro-dealers

28

reported both an equal number of times. There were virtually no mentions of company’s support

by the small dealers in any region. Awba Group, Golden Dragon, Diamond Star Golden Lion

companies provided the most support to medium and large dealers. The large number of services

provided by other companies reflect the situation in the southern Ayeyarwaddy region, where

distance from Yangon and difficult access ensures that local distribution companies provide

localized services to dealers mainly as farmer meetings, some field days and technical materials.

Table 13. Simple Ranking Scores of Company Promotion Services for Dealers

Technical

Mat. Tech. Rep

Sales

Rep

Field

Days Meetings Index Rank

Awba Group 14 13 14 14 14 69 1

Golden Lion 3 3 4 3 5 18 5

Golden Dragon 8 8 8 7 7 38 2

Diamond Star 6 6 5 6 4 27 4

Shu San Trading 1 0 0 0 0 1 8

Soe Moe Mine 0 0 0 0 0 0

Taung Paw Thar Yeshin Co. 0 0 0 0 0 0

Marlarmyaing Company Ltd. 0 0 0 0 0 0

Shwe Arhar Moe Company 2 1 1 1 1 6 6

Golden Key Company Ltd. 1 1 1 0 0 3 7

Other 8 7 6 6 6 33 3

Actual fertilizer procurement and sales for these major companies can only be estimated. The

estimates are as follows:

Shu San Trading Enterprises 400,000 mt

AWBA Group 300,000 mt

Soe Moe Mining Company 170,000 mt

Diamond Star 100,000 mt

Golden Lion 100,000 mt

Golden Dragon 80,000 mt

Estimated total annual sales 1,150,000 mt

29

Farmer Purchases

Overall, the 67 dealers surveyed reported that 63.2% of all farmers paid cash, only 1.9% used a

short-term credit facility from the dealers and 32.9% bought fertilizer on crop terms, repaying at

harvest almost exclusively in cash. Dealers commented that crop term repayments were good as

long as the farmers had a good harvest. When harvests are poor, repayments suffer and farmers

start to incur interest of between 2% and 4% per month. Details of the structure of farm

payments by dealer group and by region are presented in Table 14.

Table 14. Fertilizer Purchase Arrangements by Dealer Size and Region

Region Purchase Form Large % Medium % Small % Average %

Ayeyarwaddy Cash 49 41 45 45

Short-term credit 0 5 3 3

Crop cycle terms 51 54 52 52

Bago Cash 67 30 39 63

Short-term credit 0 0 2 1

Crop cycle terms 33 60 59 36

Yangon Cash 100 67 46 70

Short-term credit 0 3 18 4

Crop cycle terms 0 30 36 26

This partially reconciles with a recent farmer survey9 report that found 73% of farmers in the

Ayeyarwaddy region borrow money for wet season rice and bean production without irrigation

and 99% where access to irrigation is available. Borrowing sources for Ayeyarwaddy farmers

mainly came from Farmer Associations and the Myanmar Agricultural Development Bank

(MADB). Only 1.6% of wet season farmers borrowed from dealers and 5.4% of those with

irrigation. Short-term credit sales by dealers was consistently low across dealer size groups and

regions, with the exception of small dealers in the Yangon region. However, dealers reported that

between 26% and 52% of fertilizer sales were on crop cycle terms. No interest is paid under

these terms until seven to ten days after harvest. Only at that time is interest charged at 2-4% per

month. Farmers may not interpret these conditions as credit, which would account for the low

farmer survey results for dealer credit. Further clarification is needed on this.

9 FSWG, 2015. Report on Chemical and Organic Fertilizer Knowledge, Concerns and Market in Relation to

Interests of Small Holder Farmers in Myanmar.

30

Farmer Fertilizer Product Choice and Knowledge

It was consistently reported by agro-dealers that farmers get most of their advice on fertilizer use

from their peers and from their observations of fertilizer crop performance. As a result, it was

reported that around 70% of farmers know what fertilizer they want and only 30% buy on the

basis of lower price. What they want is not necessarily what is best. These observations by

dealers are consistent with the findings of a recent farmer survey.10 In that survey, farmers placed

only a medium level of importance on advice from “fertilizer companies”. It is not known

whether this characterization includes agro-dealers. In this dealer survey only around one-third

of farmers reportedly asked dealers for advice on fertilizers, and this was consistent in all

regions. This situation reflects both the lack of knowledge by farmers and dealers and that

farmers wants are not necessarily needs.

Compound NPK fertilizer sales in 2014 by medium and small agro-dealers account for only

10.3% of their total fertilizer sales. Data from the FSWG report implies that farmer use of

compound NPK fertilizer on rice accounted for 11.3% of their total fertilizer use.11 The actual

choice of compound NPK fertilizer by farmers from medium- and small-sized agro-dealers is

shown in Table 15. 10-10-5, 15-15-15 and 16-16-16 were the most popular, each accounting for

approximately 20% to 22% of the total compound sales.

Table 15. Sales of NPK Fertilizers by Medium- and Small-Sized Agro-Dealers

Medium and Small Dealers

Products Bags Price/Bag

15-15-15 12,292 33,142

15-7-7 2,300 9,403

10-10-5 12,547 17,251

16-16-16 11,100 26,313

16-16-8 5,675 27,574

15-15-6-S 300 10,104

10-10-12 1,450 8,917

Other NPK 9,480 19,865

Total NPKs 55,144

10 FSWG, 2015. Op cite. 11 Derived from Table 4 FSWG, 2015.

31

It should be noted that 16-16-16 has an average price per unit NPK of K 1,096 compared to an

equivalent price for 15-15-15 of K 1,473, which is 34% higher per kg of nutrient. This is

indicative of the lack of understanding of fertilizer prices by both farmers and dealers.

Soil fertility is declining in Myanmar, and the need is paramount for farmers to use balanced and

economic nutrient applications. Soil testing services for the private sector and dealer in addition

to farmer education are essential improvements that are needed.

Fertilizer Quality

Dealers were asked how many times either the MOAI extension service or Land Use Department

officers visited their stores annually and how many fertilizer samples were taken. The average

number of MOAI visits was one per year in the Ayeyarwaddy and Bago regions and two in the

Yangon region. No LUD quality control visits were reported. On average, one fertilizer sample

per year was taken with some agro-dealers reporting up to three samples and many reporting nil.

The LUD is understaffed12 and unable to provide inspection services below the district level.

Laboratory facilities are limited for fertilizer analysis and lacking altogether at Muse, the main

entry point for imported fertilizer. Generally, the agro-dealers in all size categories do not have

the facilities to adulterate fertilizer, but almost all sell small quantities of small packs of fertilizer

for home use, and this repackaging into polyethylene bags is not controlled or monitored.

Seed Sales

Apart from small vegetable seed packages, which are mainly imported, there is no formal seed

marketing system through the private sector. Between one-third and a half of all dealers sell

vegetable seed packages. Other seed sales are restricted to less than 10% of all dealers, and the

quantities of rice, beans and maize are very limited. The markup on vegetable seed packages

varies from as low as 10% to as high as 25%. For all other seeds, the markups vary between 5%

and 10%, with the exception of hybrid maize which was marked-up 15%.

12 IFDC Myanmar Fertilizer Policy Report 2014.

32

Given the limited quantities sold and the range of markups, seeds do not contribute a great deal

to ago-dealer markup income for most dealers, adding less than 1% to the fertilizer markup

income.

Pesticide Sales

Almost 45% of dealers surveyed are selling pesticides. Each dealer was asked to provide

information on sales and prices for the four most popular pesticides: Phyuradan, Cyperpar,

Ahweindo and Cyclone. In some cases, there was lack of knowledge on quantities sold and

prices and frequent reference to certain companies providing discounts of up to 35%. Overall, the

markups averaged between 14% and 22% as shown in Annex 3. Ahweindo sales were the lowest

of the four products, and in the Yangon region, pesticide sales were significantly lower than in

the other two regions. The total markup income on average ranged from Kyat 2,484,000 in Bago

to Kyat 341,000 in Yangon, and in all regions less than 1% was added to the fertilizer markup

income.

Pesticides are sold either by the kg or by the liter or half liter. Dealers have to undergo a one day

training on pesticides to obtain a license to sell pesticides. There appeared to be little

enforcement of secure and safe storage of pesticides, and dealer knowledge of pesticide use and

safety was limited. The markup income from pesticide sales was less than 10% of the fertilizer

markup income, except for the small dealer group where pesticides markup income added

between 12% and 23% to the fertilizer markup income.

Constraints for Agro-Dealers

All dealers were asked what constraints they had on their business, and for the most part, this

caused confusion in that the dealers interpreted the question as meaning government imposed

constraints, and explanations of what was required were given together with a list of possible

constraints. However, no priority was given to these lists, and the number of positive opinions

have been expressed as the percentage of total agro-dealers for each constraint recorded. These

are presented in Table 16. The largest proportion of responses are associated with product

knowledge, funding and credit, while approximately one-third of all dealers in all regions listed

low fertilizer margins as a constraint, and this reflects the level of competition in many areas as

33

referred to later for the Ayeyarwaddy region. In the Yangon region, there were generally fewer

recognized constraints than in the other regions.

Table 16. Summary of Agro-Dealer Constraints

Constraints

Total Ayeyarwaddy Bago Yangon

(Percent of Total Sample)

Low demand 25 31 30 0

Limited supply 22 33 15 0

Low margins 34 36 30 36

Lack of fertilizer knowledge 61 64 65 45

Lack of seed knowledge 37 33 50 27

Lack of pesticide knowledge 40 39 50 27

Lack of funds 51 53 60 27

Lack of affordable credit 51 50 70 18

Lack of storage 27 31 30 9

Lack of government promotion 24 19 40 9

Sample size (No.) 67 36 20 11

Around one-third of dealers in Ayeyarwaddy and Bago cited low demand and low margins. In

part, this may be due to intense competition in these regions due to the practice of registering

dealers frequently by the MOAI extension service and the LUD. This situation is a positive for

farmers, because prices are kept in check and greater choice is available, but the low overall

profitability of small agro-dealers restrains any efforts at their marketing agro-inputs by

providing services as well as products and indicates the need for business planning by the agro-

dealers.

When examined by dealer size group, as illustrated in Table 17, lack of funds, credit cost and

availability are most important for large, medium and small dealers. Lack of product knowledge

on fertilizers also rates high, and the lower concerns on seed and pesticide knowledge reflect the

lower proportion of dealers that handle these products compared to fertilizer and their relatively

small contributions to agro-dealer incomes.

The lower financial constraints for small dealers reflects the fact that most of these order and pay

on an as needed basis. The financial constraints for large- and medium-sized dealers reflect that

the suppliers programs for extended payment terms or consignment sales are limited in scope and

34

that most dealers pay cash for supplies. Formal affordable financial packages suitable for dealers

are required. Such trade credit products would allow dealers to borrow funds at a low interest

rate for one to three months. This would allow dealers to accumulate inventory to meet peak

demand periods.

Table 17. Summary of Agro-Dealer Constraints by Dealer Size Groups

Constraints

Total Distributors Large Medium Small

(Percent of Each Sample)

Low demand 25 50 37 23 23

Limited supply 22 0 25 20 27

Low margins 34 50 34 23 34

Lack of fertilizer knowledge 61 50 37 71 42

Lack of seed knowledge 37 0 37 51 26

Lack of pesticide knowledge 40 50 25 49 28

Lack of funds 51 0 62 54 45

Lack of affordable credit 51 0 75 51 45

Lack of storage 27 50 12 26 32

Lack of government promotion 24 50 37 23 18

Sample size (No.) 67 2 8 35 22

Training Requirements

Over 90% of all dealers are interested in receiving training, and most (80%) are willing to make

a small cost contribution for the training. The least interest is shown by the small dealers and the

most by the large- and medium-sized dealers as presented in Table 18.

The major topics selected for training subjects are fertilizers, marketing and business

management. The lower interest in seed and pesticide training probably reflects the lower

number of dealers handling these inputs. It is noted that both large and medium dealers have a

high interest in pesticide training. FSI training programs aimed at large- and medium-sized

dealers should include fertilizer and pesticide product knowledge, use and safety. In addition,

combined training on business management and marketing are required and in demand.

Dealers rely on farmers to make product selections but farmer knowledge on fertilizer use is

limited. The objective of dealer training is to ensure that dealers become recognized as

knowledgeable enough to provide advice to their farmer clients and sub-dealer clients. It is

35

therefore recommended that the FSI project training should involve dealers first, followed by

dealers together with their small sub-dealers and finally joint dealer and farmer training.

Table 18. Dealer Interest in Training Topics

Topic

Total Distributors Large Medium Small

(Percentage of Sample)

Fertilizers 74 100 100 80 52

Seeds 55 100 37 57 52

Pesticides 45 50 75 51 29

Marketing 62 50 100 66 43

Agronomy 44 50 37 46 29

Business

management

68 0 75 83 46

Crop marketing 45 50 50 49 30

Sample no. 66 2 8 35 21

Fertilizer Quality and Control

The survey asked how many times either the extension service or LUD visited each year and

how many fertilizer samples were taken. The answers were that there were on average only one

visit per dealer by the extension service and none by the LUD. The number of fertilizer samples

taken averaged one per dealer per year. As reported previously, the LUD is under-staffed to

provide quality control activities, and these are a low priority for the MOAI extension service. In

addition, the laboratory services available are inadequate.

Interest in Urea Briquette Sales and Production

After a brief description of urea deep placement technology and farmer and dealer benefits, the

dealers were asked about their interest in both selling and producing urea briquettes.

Approximately 40% of all dealers were interested in selling briquettes once the benefits have

been demonstrated to farmers, and around 20% indicated interest in manufacturing briquettes.

The premises of most dealer shops are too small to accommodate briquette manufacture, so

interest was confined to those large- and medium-sized dealers who had warehouses. From the

survey analysis of fertilizer sales, it would be prudent to concentrate manufacture with these

dealers, especially those with established business relations with a large number of small (sub-)

dealers.

36

Scaling of Survey Data

Although the randomness of the sample population of dealers was established, the sample size of

5%, selected on the basis of time and cost, was perhaps too small to accurately scale up to the

total number of dealers in each size category. However, simple estimates suggest that a total of

205 large dealers currently selling between 20,000 and 100,000 fertilizer bags annually are

present in the three FSI regions, and of these, 185 sell to sub-dealers (small dealers). Estimates

by region are presented in Table 19 together with estimates of medium-sized dealers.

There are probably sufficient large dealers with sales through sub-dealers from which to select

potential briquette manufacturers, and the total of large- and medium-sized dealers with sub-

dealer sales can be accommodated for training purposes by the project.

Table 19. Estimates of Large and Medium-Sized Dealers by Region With and Without

Sub-Dealer Sales

Ayeyarwaddy Bago Yangon Total

Large dealers 121 66 18 205

Medium dealers 363 198 672 1,233

Total 484 264 692 1,438

Large with subs 101 66 18 185

Medium with subs 201 154 55 410

Total with subs 302 220 73 595

Summary and Recommendations

Overall, the agro-dealers in the three FSI project regions are constrained by lack of knowledge of

the products that they sell, by working capital requirements, the small size of their business

premises and affiliated storage capacity and low profitability, especially for the small dealer

category. For the most part, they are not constrained by the procurement and distribution systems

for fertilizer or pesticides. A formal seed market through the private sector is non-existent,

except for vegetable seeds which most dealers sell in small packets. The lack of profitability and

financial resources for agro-dealers restricts their ability to invest in market development, and it

cannot be expected that small dealers will make any effort to be any more than “stockists” trying

37

to meet localized farmer demands. The larger of the medium-sized and large dealers do generate

sufficient profits to develop markets but are constrained by low product knowledge levels and

business management and marketing knowledge. There is, however, a significant desire to attend

training in all of these subjects, and a series of project training programs need to be undertaken.

The limited level of farmer knowledge on agro-inputs has to be addressed by trained agro-

dealers, and it is recommended that joint dealer-farmer training programs will hasten

improvements in product selection and use.

Farmer demand for fertilizer is quite strong, but the level of understanding of balanced

fertilization and maintaining soil fertility and structure is limited to local field/peer observations

and restricted by access to affordable credit for agro-input use. Joint training meetings for both

dealers and farmers are recommended after initial dealer training on product knowledge.

Specific project recommendations include:

1. Dealer Technical Knowledge:

a. Develop fertilizer product training modules to include product characteristics, product

use, recognition of nutrient deficiencies in crops and balanced nutrient use.

b. Develop pesticide product training modules for selected dealers to include safety training

and product uses.

2. Dealer Agro-economic Knowledge:

a. Provide agro-dealers with specific localized crop budget information and agronomic

information in conjunction with the local MOAI staff.

3. Dealer Supplier Coordination:

a. Meet with the Fertilizer and Pesticide Association to inform the members of the project

work plans and explore areas of cooperation in training and field demonstrations.

4. Dealer Business Management:

a. Develop training program modules on simple business record keeping, credit

management, business planning, marketing and pricing of agro-inputs.

5. Dealer Credit:

a. Work with the formal finance sector to develop credit products designed specifically for

agro-dealers to provide a means of financing crop cycle credit for farmers.

38

6. Urea Briquette Production:

a. Use a production and marketing strategy that relies on one production unit per main

market area located at a medium-sized dealer with sufficient warehouse space allied to

several agro-dealers purchasing and re-selling briquettes to farmers. This strategy is

working in Bangladesh, and as long as the briquette machines are working at 80% or

more of capacity, the producers can make substantial profits and the re-selling agro-

dealers increase income in meeting farmer demand.

b. Good quality urea is required for briquette manufacture, and potential briquette producers

need to be made aware of this.

c. IFDC resources to develop workable briquette applicators (preferably motorized) are

necessary in view of the rural labor shortage and cost.

7. Farmer Training:

a. Farmer training in efficient agro-input use for sustainable crop production is essential,

preferably in conjunction with agro-dealers.

b. Joint cost-sharing farmer training meetings and field demonstrations with the major

fertilizer companies in Myanmar should be investigated.

39

Annex 1. Survey Form

FERTILIZER SECTOR IMPROVEMENT (FSI) – MYANMAR

DRAFT

Bench Mark Agro-Input Dealers Survey

Name of Enumerator: ____________________

Date: _________________________________

This survey is being made by IFDC to determine how best its FSI+ project funded by

USAID can best serve agro-input dealers in providing assistance and support for existing

agro-input activities and providing new business opportunities. The FSI project is

introducing a new product to Myanmar, Urea Deep Placement (UDP), which provides rice

farmers with benefits arising from improved nitrogen use efficiency approximating a one-

third reduction in nitrogen application and a 15% increase in yield. All individual firm

information collected in this survey will remain confidential to IFDC and its employees.

Only aggregate information on agro-input dealers will be reported and individual

information will be recorded under code numbers in our internal records.

Your cooperation in providing your business information is appreciated.

Please provide the following information on your agro-input business.

1. Name of business: _____________________________________________________

2. Name of owner/manager: _____________________________ Gender: M/F_______

3. Address: ____________________________________________________________

4. Telephone: _____________ Mobile: ___________ Email: ________________

40

5. Which of the following categories best describes your business?

General trader ___ Agro-input dealer ___Cooperative ___Other ___

Specify Other __________________________________________________

6. Number of years in this business: _______________________

7. Number of stores owned: ______

8. Number of employees: Total _____ Male ____ Female _____

9. What is the fertilizer storage capacity of the store(s)? ________bags

10. Do you own a warehouse? _____

If yes what is the storage capacity in bags?_____

If yes do you mix (1), blend (2) or re-bag (3) ___ ___ ___

11. Do you sell products to sub-dealers? _____

If yes how many sub-dealers? _____

12. In addition to selling to farmers, do you sell agro-inputs

At wholesale to other large dealers? ___

13. Are you registered as an agro-input dealer? ____

14. What agro-inputs do you sell?

Fertilizer ___

Seed ___

Crop protection products ___

Farm tools ___

Farm Machinery ___

Feed ___

Veterinary products ___

41

15. Do you sell consumer goods? ___

16. How many farmer customers do you have? _____

17. How many other stores are competitors? ______

18. Do you buy crop products from farmers? ___

19. Do you process crop products from farmers? ___

42

Fertilizer

20. Please estimate fertilizer product sales during 2014 and current prices:

Products 2014 Current Prices per Bag

Number of bags Buying Price Selling Price

Urea (domestic)

Urea(imported)

15-15-15

15-7-7

10-10-5

16-16-16

16-16-16ME

15-15-6-4S

10-12-12

Other NPK

GSSP

GTSP

MOP

Gypsum

Organic

Foliar (Ltrs.)

Other

43

21. From Which Companies do you buy fertilizer? Terms

Y/N Cash Commission Credit /days/rate

a. Awba Group ____ _____ ______% _____/____/____

b. Golden Lion ____ _____ ______% _____/____/____

c. Ammo ____ _____ ______% _____/____/____

d. Diamond Star ____ _____ ______% _____/____/____

e. Shu San Trading ___ _____ ______% _____/____/____

f. Soe Moe Mine ____ _____ ______% _____/____/____

g. Taung Paw Thar Yeshin Co. ___ _____ ______% _____/____/____

h. Marlarmyaing Company Ltd.___ _____ ______% _____/____/____

i. Shwe Arkar Moe Co.Ltd. ___ _____ ______% _____/____/____

j. Golden Key Company ___ _____ ______% _____/____/____

k. Other (Specify) _______________________________ _____/____/____

22. Any Comments on 21.

23. Supplier Services

Company Technical

Materials

(Number)

Technical

Rep

Visits/yr.

Salesperson

Visits/yr.

Field Days /yr. Farmer

Meetings

Awba Group

Golden Lion

Diamond Star

Shu San Trading

Taung Paw

Soe Moe Mine

Golden Key Co.

Thar Yeshin Co.

Marlarmyaing

Company Ltd.

Shwe Arkar

Moe Co. Ltd.

Taung Paw

Tharr Yee Shin

Co.

Other

Other

44

24. Do most farmers know which fertilizer to select or do they buy on price per bag?

a. Know what they want ________

b. Buy on price per bag ________

25. Quality: How often does LUD or MOAI inspect each year? _________

26. How many fertilizer samples were taken last year? ________

SEEDS

27. Please estimate seed sales in baskets/kilograms during the past three years and current

prices:

Crop Seed 2012 2013 2014 Price/kg Markup

Rice Hybrid

Other Rice

Maize Hybrid

Other Maize

Green Gram

Vegetables

Other

Other

45

28. Please estimate sales of crop protection chemicals (liters) during the past three

years.

Trade Name Active ingredient 2012 2013 2014 Price/liter Markup %

Phyuradan Carbonural

Cyperpar Cypermenthrin

Ahweindo Endosulfan

Cylone Chloropyrifos

Other

Other

30. Are you interested in training on the operation of an agro-input business and

product use?

Yes ___ No ___

If yes, what type of training is of interest?

Yes/No

Fertilizer product use ______

Improved seed varieties ______

CPC product use and safety ______

Agro-input marketing ______

Agronomic training ______

Business training ______

Crop marketing/processing ______

31. Are you willing to share a small cost of training in an area of interest?

Yes ___ No ___

46

33. What are your major constraints in selling agro-inputs? Select one or more of these.

a. No or insufficient demand

b. No availability of inputs in nearby markets

c. Level of margins

d. Insufficient product knowledge of fertilizers

e. Insufficient product knowledge of seeds

f. Insufficient product knowledge of pesticides

g. Lack of funds

h. No availability or high cost of credit

i. Lack of storage space

j. No sales promotion by producers/suppliers/Government agencies.

Any other reason --------------------------------------------------------

__________________________________________________________________

FARMERS

35. Number of farmer customers and crop areas

Total number of farmer customers: __________

36. Crop Areas:

Crop 1. ___________________ Ha____________

Crop 2. ___________________ Ha____________

Crop 3. ___________________ Ha____________

Crop 4. ___________________ Ha____________

Crop 5. ___________________ Ha____________

Crop 6. ___________________ Ha____________

Crop 7. ___________________ Ha____________

47

37. Fertilizer Sales terms to Farmers

% Cash % Sh.term Credit % crop cycle credit

_________ ______________ _______________

38. Interest in UDP sales: Yes No

39. Interest in UDP production and sales: Yes No

48

Annex 2. Ayeyarwaddy Fertilizer Sales 2014

Table 2.1. Summary of Fertilizer Sales in 2014 for 36 Agro-Dealers in Ayeyarwaddy Region

Products

Agro-Dealers Sales (bags) 2014 Current Prices per Bag Markup

No. % Total Per Dealer Buying Selling Kyat %

Urea (Domestic) 34 94% 109,445 3,219 15,963 16,747 784 4.91%

Urea (Imported) 29 81% 87,250 3,009 19,002 19,907 905 4.76%

15-15-15 24 67% 8,500 354 35,046 36,738 1,692 4.83%

15-7-7 10 28% 2,000 200 23,050 24,080 1,030 4.47%

10-10-5 19 53% 18,560 977 22,368 23,221 853 3.81%

16-16-16 5 14% 900 180 39,500 40,900 1,400 3.54%

16-16-8 21 58% 5,985 285 27,571 28,490 919 3.33%

15-15-6-S 3 8% 350 117 26,733 27,500 767 2.87%

10-10-12 4 11% 1,000 250 20,875 21,750 875 4.19%

Other NPK 16 44% 7,230 452 18,263 19,231 969 5.30%

GSSP 15 42% 8,750 583 11,207 12,007 800 7.14%

GTSP 23 64% 14,450 628 18,074 18,957 883 4.88%

MOP 23 64% 4,660 203 23,635 25,157 1,522 6.44%

Gypsum 24 67% 6,763 282 6,429 6,994 565 8.78%

Organic 12 33% 2,874 240 7,154 7,725 571 7.98%

Foliar (ltrs) 16 44% 49,229 3,077 5,297 6,116 819 15.46%

Other 4 11% 11,350 2,838 16,025 17,000 975 6.08%

Total 36 290,067 8,057 880 4.87%

Table 2.2 Summary of Fertilizer Sales in 2014 for Large Agro-Dealers in Ayeyarwaddy Region

Products

Agro-Dealers Sales (bags) 2014 Current Prices per Bag Markup

No. % Total Per Dealer Buying Selling Kyat %

Urea (Domestic) 5 83% 58,000 11,600 15,140 15,680 540 4%

Urea (Imported) 4 67% 53,000 13,250 18,375 19,625 1,250 7%

15-15-15 3 50% 3,900 1,300 32,333 33,500 1,167 4%

15-7-7 1 17% 800 800 15,000 15,500 500 3%

10-10-5 4 67% 14,300 3,575 15,550 16,425 875 6%

16-16-16 1 17% 500 500 34,000 34,500 500 1%

16-16-8 4 67% 2,700 675 26,000 26,875 875 3%

15-15-6-S 2 33% 300 150 27,850 28,750 900 3%

10-10-12 1 17% 700 700 15,000 15,500 500 3%

Other NPK 4 67% 3,750 938 21,000 22,000 1,000 5%

GSSP 3 50% 6,400 2,133 10,467 11,167 700 7%

GTSP 4 67% 7,300 1,825 18,325 19,500 1,175 6%

MOP 4 67% 1,200 300 22,650 23,750 1,100 5%

Gypsum 3 50% 558 186 5,067 5,450 383 8%

Organic 2 33% 2,050 1,025 11,500 12,000 500 4%

Foliar (ltrs) 4 67% 43,000 10,750 5,925 6,750 825 14%

Other 20-10-5 2 33% 10,800 5,400 21,500 22,250 750 3%

Total 6 166,258 27,710 828 5.19%

49

Table 2.3 Summary of Fertilizer Sales in 2014 for Medium Agro-Dealers in Ayeyarwaddy Region

Products

Agro-Dealers Sales (bags) 2014 Current Prices per Bag Markup

No. % Total Per Dealer Buying Selling Kyat %

Urea (Domestic) 17 94% 40,000 2,353 15,794 16,597 803 5.08%

Urea (Imported) 17 94% 23,100 1,359 18,815 19,671 856 4.55%

15-15-15 11 61% 4,020 365 39,509 40,836 1,327 3.36%

15-7-7 3 17% 900 300 22,167 23,500 1,333 6.02%

10-10-5 12 67% 4,100 342 26,025 26,892 867 3.33%

16-16-16 3 17% 300 100 31,667 32,833 1,167 3.68%

16-16-8 11 61% 3,080 280 28,091 29,027 936 3.33%

15-15-6-S 0 0 0 0 0 0

10-10-12 2 11% 250 125 27,000 28,250 1,250 4.63%

Other NPK 10 56% 3,350 335 17,520 18,520 1,000 5.71%

GSSP 9 50% 1,850 206 10,800 11,678 878 8.13%

GTSP 14 78% 6,600 471 18,807 19,786 979 5.20%

MOP 14 78% 3,000 214 23,643 25,436 1,793 7.58%

Gypsum 13 72% 5,675 437 7,154 7,715 562 7.85%

Organic 6 33% 704 117 6,333 6,917 583 9.21%

Foliar (ltrs) 6 33% 4,675 779 6,108 6,950 842 13.78%

Other 20-10-5 2 11% 550 275 10,550 11,750 1,200 11.37%

Total 18 97,479 5,416 888 4.87%

Table 2.4. Summary of Fertilizer Sales in 2014 for Small Agro-Dealers in Ayeyarwaddy Region

Products

Agro-Dealers Sales (bags) 2014 Current Prices per Bag Markup

No. % Total Per Dealer Buying Selling Kyat %

Urea (Domestic) 11 92% 1,445 131 16,641 17,532 891 5.35%

Urea (Imported) 7 58% 1,150 164 19,843 20,714 871 4.39%

15-15-15 9 75% 380 42 30,722 33,000 2,278 7.41%

15-7-7 5 42% 200 40 25,500 26,460 960 3.76%

10-10-5 2 17% 60 30 17,000 17,900 900 5.29%

16-16-16 1 8% 20 20 38,000 40,000 2,000 5.26%

16-16-8 6 50% 205 34 27,667 28,583 917 3.31%

15-15-6-S 1 8% 50 50 24,500 25,000 500 2.04%

10-10-12 0 0 0 0 0 0 0 0

Other NPK 1 8% 100 100 18,500 19,500 1,000 5.41%

GSSP 2 17% 300 150 14,500 15,250 750 5.17%

GTSP 4 33% 350 88 15,150 15,500 350 2.31%

MOP 4 33% 160 40 24,125 25,125 1,000 4.15%

Gypsum 8 67% 530 66 5,763 6,400 638 11.06%

Organic 4 33% 120 30 6,213 6,800 588 9.46%

Foliar (ltrs) 6 50% 1,554 259 4,067 4,858 792 19.47%

Other 20-10-5 0 0 0 0 0 0

Total 12 5,070 986 921 5.33%

50

Annex 3. Fertilizer Sales in Bago Region 2014

Table 3.1. Summary of Fertilizer Sales in 2014 for 20 Agro-Dealers in Bago Region

Products

Agro-Dealers Sales (bags) 2014 Current Prices per Bag Markup

No. % Total Per Dealer Buying Selling Kyat %

Urea (Domestic) 17 85% 443,450 26,085 15,865 16,733 868 5.47%

Urea (Imported) 15 75% 235,580 15,705 18,055 19,065 1,010 5.60%

15-15-15 19 95% 21,890 1,152 30,500 31,157 657 2.16%

15-7-7 6 30% 4,700 783 21,723 22,596 872 4.02%

10-10-5 15 75% 16,380 1,092 15,236 16,130 893 5.86%

16-16-16 12 60% 18,280 1,523 31,633 32,298 664 2.10%

16-16-8 9 45% 6,870 763 31,319 32,020 701 2.24%

15-15-6-S 3 15% 1,250 417 23,720 24,700 980 4.13%

10-10-12 4 20% 2,000 500 32,700 33,450 750 2.29%

Other NPK 14 70% 12,470 891 20,931 22,687 1,756 8.39%

GSSP 5 25% 11,750 2,350 8,012 9,362 1,349 16.84%

GTSP 8 40% 20,350 2,544 16,688 18,156 1,468 8.80%

MOP 4 20% 7,550 1,888 25,735 27,467 1,732 6.73%

Gypsum 16 80% 14,870 929 4,518 5,268 750 16.60%

Organic 8 40% 12,020 1,503 3,045 3,657 612 20.10%

Foliar (ltrs) 14 70% 28,120 2,009 6,665 7,854 1,189 17.85%

Other 0 0 0 0 0 0 0 0

Total 20 829,410 41,471 934 5.12%

Table 3.2. Summary of Fertilizer Sales in 2014 for Two Distributors in Bago Region

Products

Agro-Dealers Sales (bags) 2014 Current Prices per Bag Markup

No. % Total Per Dealer Buying Selling Kyat %

Urea (Domestic) 2 100% 390,000 195,000 15,900 16,750 850 5.35%

Urea (Imported) 2 100% 200,000 100,000 19,000 20,000 1,000 5.26%

15-15-15 2 100% 12,000 6,000 34,500 34,500 0 0.00%

15-7-7 0 0% 0 0 0 0 0 0.00%

10-10-5 2 100% 2,000 1,000 15,750 17,250 1,500 9.52%

16-16-16 2 100% 1,000 500 38,250 38,000 -250 -0.65%

16-16-8 2 100% 1,000 500 17,250 17,750 500 2.90%

15-15-6-S 0 0% 0 0 0 0 0 0.00%

10-10-12 0 0% 0 0 0 0 0 0

Other NPK 2 100% 2,000 1,000 22,250 23,750 1,500 6.74%

GSSP 2 100% 2,000 1,000 4,750 5,500 750 15.79%

GTSP 2 100% 2,000 1,000 8,500 9,250 750 8.82%

MOP 0 0% 0 0 0 0 0 0

Gypsum 2 100% 1,400 700 7,900 8,750 850 10.76%

Organic 0 0% 0 0 0 0 0 0

Foliar (ltrs) 2 100% 1,120 560 7,350 8,500 1,150 15.65%

Other 0 0 0 0 0 0

Total 2 613,400 306,700 884 5.12%

51

Table 3.3. Summary of Fertilizer Sales in 2014 for Three Large Agro-Dealers in Bago

Region

Products

Agro-Dealers Sales (bags) 2014 Current Prices per Bag Markup

No. % Total Per Dealer Buying Selling Kyat %

Urea (Domestic) 3 100% 50,000 16,667 15,667 16,667 1,000 6.38%

Urea (Imported) 2 67% 20,000 10,000 18,000 20,000 2,000 11.11%

15-15-15 3 100% 6,500 2,167 20,000 21,000 1,000 5.00%

15-7-7 2 67% 3,500 1,750 17,000 18,000 1,000 5.88%

10-10-5 2 67% 9,500 4,750 15,500 16,000 500 3.23%

16-16-16 3 100% 6,500 2,167 21,500 22,500 1,000 4.65%

16-16-8 2 67% 5,500 2,750 34,000 34,750 750 2.21%

15-15-6-S 1 33% 1,000 1,000 24,000 25,000 1,000 4.17%

10-10-12 2 67% 800 400 32,000 33,000 1,000 3.13%

Other NPK 2 67% 5,500 2,750 23,000 25,000 2,000 8.70%

GSSP 1 33% 7,200 7,200 16,200 19,000 2,800 17.28%

GTSP 3 100% 18,000 6,000 18,100 19,833 1,733 9.58%

MOP 3 100% 7,500 2,500 25,767 27,500 1,733 6.73%

Gypsum 3 100% 8,500 2,833 2,883 3,167 283 9.83%

Organic 2 67% 10,000 5,000 1,000 1,500 500 50.00%

Foliar (ltrs) 1 33% 500 500 6,620 7,600 980 14.80%

Other 0 0% 0

Total 3 160,000 53,333 1,218 8.29%

Table 3.4. Summary of Fertilizer Sales in 2014 for Nine Medium Agro-Dealers in Bago

Region

Products

Agro-Dealers Sales (bags) 2014 Current Prices per Bag Markup

No. % Total Per Dealer Buying Selling Kyat %

Urea (Domestic) 7 78% 2,700 386 16,429 17,571 1,143 6.96%

Urea (Imported) 7 78% 15,300 2,186 18,071 19,129 1,057 5.85%

15-15-15 9 100% 3,230 359 35,389 37,356 1,967 5.56%

15-7-7 4 44% 1,200 300 28,750 29,375 625 2.17%

10-10-5 8 89% 4,740 593 14,563 15,875 1,313 9.01%

16-16-16 6 67% 10,730 1,788 35,333 36,917 1,583 4.48%

16-16-8 4 44% 320 80 26,000 27,375 1,375 5.29%

15-15-6-S 1 11% 200 200 24,000 25,000 1,000 4.17%

10-10-12 2 22% 1,200 600 29,500 30,250 750 2.54%

Other NPK 8 89% 4,670 584 21,563 23,063 1,500 6.96%

GSSP 1 11% 2,500 2,500 10,300 12,000 1,700 16.50%

GTSP 3 33% 350 117 20,167 21,367 1,200 5.95%

MOP 1 11% 50 50 21,000 22,500 1,500 7.14%

Gypsum 9 100% 4,850 539 5,611 6,556 944 16.83%

Organic 6 67% 2,020 337 9,908 11,283 1,375 13.88%

Foliar (ltrs) 8 89% 24,600 3,075 5,274 6,108 833 15.80%

Other 0 0% 0 0 0 0 0 0

Total 9 54,060 6,007 0 0 1,248 6.41%

52

Table 3.5. Summary of Fertilizer Sales in 2014 for Six Small Agro-Dealers in Bago Region

Products

Agro-Dealers Sales (bags) 2014 Current Prices per Bag Markup

No. % Total Per Dealer Buying Selling Kyat %

Urea (Domestic) 5 83% 750 150 17,120 18,000 880 5.14%

Urea (Imported) 4 67% 280 70 18,325 19,500 1,175 6.41%

15-15-15 5 83% 160 32 29,160 30,600 1,440 4.94%

15-7-7 0 0% 0 0 0 0 0 0.00%

10-10-5 3 50% 140 47 17,333 18,167 833 4.81%

16-16-16 1 17% 50 50 34,500 35,000 500 1.45%

16-16-8 1 17% 50 50 35,000 35,500 500 1.43%

15-15-6-S 1 17% 50 50 17,000 17,500 500 2.94%

10-10-12 0 0% 0 0 0 0 0 0.00%

Other NPK 2 33% 300 150 17,500 18,250 750 4.29%

GSSP 1 17% 50 50 11,500 12,000 500 4.35%

GTSP 0 0% 0 0 0 0 0 0.00%

MOP 0 0% 0 0 0 0 0 0.00%

Gypsum 2 33% 120 60 10,250 11,000 750 7.32%

Organic 0 0% 0 0 0 0 0 0.00%

Foliar (ltrs) 3 50% 1,900 633 5,350 7,150 1,800 33.64%

Other 0 0% 0 0 0 0 0.00%

Total 6 1,950 325 786 4.32%

53

Annex 4. Fertilizer Sales for 11 Agro-Dealers in Yangon Region 2014

Table 4.1. Summary of Fertilizer Sales in 2014 for 11 Agro-Dealers in Yangon Region

Products

Dealers Sales (bags) 2014 Current Prices per Bag Markup

No. % 2014 Per Dealer Buying Selling Kyat %

Urea (Domestic) 11 100.0% 11,810 1,074 15,873 16,782 909 5.73%

Urea (Imported) 7 63.6% 13,200 1,886 18,614 19,729 1,114 5.99%

15-15-15 9 81.8% 5,630 626 30,378 32,722 2,344 7.72%

15-7-7 0 0.0% 0 0 0 0 0 0

10-10-5 8 72.7% 4,600 575 14,263 15,188 925 6.49%

16-16-16 0 0.0% 0 0 0 0 0 0

16-16-8 8 72.7% 3,020 378 29,875 31,213 1,338 4.48%

15-15-6-S 0 0.0% 0 0 0 0 0 0

10-10-12 0 0.0% 0 0 0 0 0 0

Other NPK 6 54.5% 1,210 202 21,583 23,533 1,950 9.03%

GSSP 5 45.5% 710 142 9,600 10,840 1,240 12.92%

GTSP 10 90.9% 7,700 770 18,280 19,480 1,200 6.56%

MOP 3 27.3% 550 183 22,667 24,167 1,500 6.62%

Gypsum 7 63.6% 1,950 279 6,900 7,714 814 11.80%

Organic 4 36.4% 830 208 15,200 16,875 1,675 11.02%

Foliar (ltrs) 4 36.4% 0 0 1,300 1,500 200 15.38%

Other 0 0.0% 0 0 0 0 0 0

Total 11 51,210 4,655 1,235 6.50%

Table 4.2. Summary of Fertilizer Sales in 2014 for One Large Agro-Dealer in Yangon Region

Products

Dealers Sales (bags) 2014 Current Prices per Bag Markup

No. % 2014 Per Dealer Buying Selling Kyat %

Urea (Domestic) 1 5,000 5,000 15,600 16,200 600 3.85%

Urea (Imported) 1 10,000 10,000 19,000 19,600 600 3.16%

15-15-15 1 1,000 1,000 24,400 25,000 600 2.46%

15-7-7 0 0

10-10-5 1 1,000 1,000 14,900 15,500 600 4.03%

16-16-16 0 0

16-16-8 1 1,000 1,000 34,100 34,700 600 1.76%

15-15-6-S 0 0

10-10-12 0 0

Other NPK 0 0

GSSP 0 0

GTSP 1 3,000 3,000 17,700 18,300 600 3.39%

MOP 0 0

Gypsum 0 0

Organic 0 0

Foliar (ltrs) 0 0

Other 0 0

Total 1 21,000 21,000 600 3.19%

54

Table 4.3. Summary of Fertilizer Sales in 2014 for Six Medium Agro-Dealers in Yangon

Region

Products

Dealers Sales (bags) 2014 Current Prices per Bag Markup

No. % 2014 Per Dealer Buying Selling Kyat %

Urea (Domestic) 6 100% 6,300 1,050 15,833 16,783 950 6.00%

Urea (Imported) 4 67% 3,000 750 18,250 19,375 1,125 6.16%

15-15-15 6 1 4,500 750 28,333 30,917 2,583 9.12%

15-7-7 0 0 0 0 0 0 0 0

10-10-5 6 1 3,550 592 14,533 15,500 967 6.65%

16-16-16 0 0 0 0 0 0 0 0

16-16-8 6 1 1,950 325 29,483 30,833 1,350 4.58%

15-15-6-S 0 0 0 0 0 0 0 0

10-10-12 0 0 0 0 0 0 0 0

Other NPK 5 83% 1,200 240 22,900 25,100 2,200 9.61%

GSSP 3 0.5 600 200 9,500 11,000 1,500 15.79%

GTSP 6 100% 4,400 733 18,100 19,417 1,317 7.27%

MOP 3 50% 550 183 22,667 24,167 1,500 6.62%

Gypsum 6 100% 1,900 317 6,750 7,583 833 12.35%

Organic 3 50% 650 217 14,600 16,000 1,400 9.59%

Foliar (ltrs) 3 50% 0 0 1,733 2,000 267 15.38%

Other 0 0 0 0 0 0 0 0.00%

Total 6 28,600 4,767 0 0 1,359 5.75%

Table 4.4. Summary of Fertilizer Sales in 2014 for Four Small Agro-Dealers in Yangon Region

Products

Dealers Sales (bags) 2014 Current Prices per Bag Markup

No. % 2014 Per Dealer Buying Selling Kyat %

Urea (Domestic) 4 100% 510 128 16,000 16,925 925 5.78%

Urea (Imported) 2 50% 200 100 19,150 20,500 1,350 7.05%

15-15-15 2 50% 130 65 39,500 42,000 2,500 6.33%

15-7-7 0 0% 0 0 0 0 0 0

10-10-5 1 25% 50 50 12,000 13,000 1,000 8.33%

16-16-16 0 0% 0 0 0 0 0 0

16-16-8 1 25% 70 70 28,000 30,000 2,000 7.14%

15-15-6-S 0 0% 0 0 0 0 0 0

10-10-12 0 0% 0 0 0 0 0 0

Other NPK 1 25% 10 10 15,000 15,700 700 4.67%

GSSP 2 50% 110 55 9,750 10,600 850 8.72%

GTSP 3 75% 300 100 18,833 20,000 1,167 6.19%

MOP 0 0% 0 0 0 0 0 0

Gypsum 1 25% 50 50 7,800 8,500 700 8.97%

Organic 1 25% 180 180 17,000 19,500 2,500 14.71%

Foliar (ltrs) 1 25% 0 0 0 0 0 0

Other 0 0% 0 0 0 0

Total 4 1,610 403 1,362 6.60%

55

Annex 5. Seed Sales by Region and Dealer Size

Table 5.1. Seed Sales by All Agro-Dealers in Ayeyarwaddy

Products

Sales (bags/baskets) Current Prices per Unit Markup

No. 2014 Buying Selling Kyat %

Rice Hybrid 1 700 5,000 5,250 250 5%

Other Rice 1 50 9,500 9,500 0 0%

Maize Hybrid 3 80 20,000 21,735 1,735 9%

Other Maize 3 510 12,500 13,275 775 6%

Green Gram 3 540 51,667 55,500 3,833 7%

Vegetables 10 2025 1,690 1,882 192 11%

Other 1 50 45,000 49,500 4,500 10%

Other 0 0 0 0

Table 5.2 Seed Sales by Large Agro-Dealers in Ayeyarwaddy

Products

Sales (bags/baskets) Current Prices per Unit Markup

No. 2014 Buying Selling Kyat %

Rice Hybrid 0 0 0 0 0 0%

Other Rice 0 0 0 0 0 0%

Maize Hybrid 0 0 0 0 0 0%

Other Maize 1 400 18,500 19,000 500 3%

Green Gram 1 130 55,000 60,500 5,500 10%

Vegetables 0 0 0 0 0 0%

Other 1 50 45,000 49,500 4,500 10%

Other 0 0 0 0

Table 5.3. Seed Sales by Medium-Sized Agro-Dealers in Ayeyarwaddy in 2014

Products

Sales (bags/baskets) Current Prices per Unit Markup

No. 2014 Buying Selling Kyat %

Rice Hybrid 1 700 5,000 5,250 250 5%

Other Rice 0 0 0 0 0 0%

Maize Hybrid 2 30 23,250 25,515 2,265 10%

Other Maize 0 0 0 0 0 0%

Green Gram 1 400 60,000 66,000 6,000 10%

Vegetables 5 1,275 1,690 1,878 188 11%

Other 0 0 0 0 0 0%

Other 0 0 0 0 0 0%

56

Table 5.4. Seed Sales by Small Agro-Dealers in Ayeyarwaddy in 2014

Products

Sales (bags/baskets) Current Prices per Unit Markup

No. 2014 Buying Selling Kyat %

Rice Hybrid 0 0 0 0 0 0%

Other Rice 1 50 9,500 9,500 0 0%

Maize Hybrid 1 50 13,500 14,175 675 5%

Other Maize 2 110 9,500 10,413 913 10%

Green Gram 1 10 40,000 40,000 0 0%

Vegetables 5 750 1,690 1,887 197 12%

Other 0 0 0 0 0 0%

Other 0 0 0 0

Table 5.5. Seed Sales for All Agro-Dealers in Bago Region

Products

Sales (bags/baskets) Current Prices per Unit Markup

No. 2014 Buying Selling Kyat %

Rice Hybrid 1 20,000 5,000 5,500 500 10%

Other Rice 0 0 0 0 0 0%

Maize Hybrid 3 3 25,000 28,750 3750 15%

Other Maize 1 0 0 0 0 0%

Green Gram 3 5,950 30,500 31,740 1240 4%

Vegetables 9 4,805 3,211.11 3,480 268.89 8%

Other 2 150 8,500 9,862.50 1362.5 16%

Other 1 80 60,900 63,945 3045 5%

Table 5.6. Seed Sales by Distributors in Bago Region 2014

Products

Sales (bags/baskets) Current Prices per Unit Markup

No. 2014 Buying Selling Kyat %

Rice Hybrid 0 0 0 0 0 0%

Other Rice 0 0 0 0 0 0%

Maize Hybrid 2 3 25,000 28,750 3,750 15%

Other Maize 1 0 0 0 0 0%

Green Gram 0 0 0 0 0 0%

Vegetables 2 435 6 7 1 25%

Other 1 0 0 0 0 0%

Other 0 0 0 0 0 0%

57

Table 5.7. Seed Sales by Large Agro-Dealers in Bago Region 2014

Products

Sales (bags/baskets) Current Prices per Unit Markup

No. 2014 Buying Selling Kyat %

Rice Hybrid 1 20,000 0.25 0.275 0.025 10.00%

Other Rice 0 0 0 0 0 0%

Maize Hybrid 0 0 0 0 0 0%

Other Maize 0 0 0 0 0 0%

Green Gram 0 0 0 0 0 0%

Vegetables 1 1,800 11,000 11,550 550.00 5%

Other 0 0 0 0 0 0%

Other 0 0 0 0 0 0%

Table 5.8. Seed Sales by Medium-Sized Agro-Dealers in Bago Region in 2014

Products

Sales (bags/baskets) Current Prices per Unit Markup

No. 2014 Buying Selling Kyat %

Rice Hybrid 0 0 0.0 0.0 0.0 0.00%

Other Rice 0 0 0.0 0.0 0.0 0%

Maize Hybrid 1 0 0.0 0.0 0.0 0%

Other Maize 0 0 0.0 0.0 0.0 0%

Green Gram 2 1,200 52.5 55.1 2.6 5%

Vegetables 3 1,250 5.9 6.2 0.3 5%

Other 1 150 30.0 31.5 1.5 5%

Other 1 80 761.3 799.3 38.1 5%

Table 5.9. Seed Sales by Small Agro-Dealers in Bago Region 2014

Products

Sales (bags/baskets) Current Prices per Unit Markup

2012 2014 Buying Selling Kyat %

Rice Hybrid 0 0 0 0 0 0.00%

Other Rice 0 0 0 0 0 0%

Maize Hybrid 0 0 0 0 0 0%

Other Maize 0 0 0 0 0 0%

Green Gram 1 4750 6.00 6.12 0.12 2%

Vegetables 2 70 5.71 7.14 1.43 25%

Other 0 0 0 0 0 0%

Other 0 0 0 0 0 0%

58

Table 5.10. Seed Sales by All Agro-Dealers in Yangon Region 2014

Products

Sales (bags/baskets) Current Prices per Unit Markup

2012 2014 Buying Selling Kyat %

Rice Hybrid 1 1 4,000 4,400 400 10%

Other Rice 2 4,100 6,000 6,500 500 8%

Maize Hybrid 1 100 5,500 6,050 550 10%

Other Maize 0 0 0 0 0 0%

Green Gram 1 50 4,200 4,620 420 10%

Vegetables 4 1,550 2,300 2,468.75 169 7%

Other 0 0 0 0 0 0%

Other 0 0 0 0

Table 5.11. Seed Sales by Large Agro-Dealers in Yangon Region 2014

Products

Sales (bags/baskets) Current Prices per Unit Markup

2012 2014 Buying Selling Kyat %

Rice Hybrid 0 0 0 0 0 0%

Other Rice 0 0 0 0 0 0%

Maize Hybrid 0 0 0 0 0 0%

Other Maize 0 0 0 0 0 0%

Green Gram 0 0 0 0 0 0%

Vegetables 0 0 0 0 0 0%

Other 0 0 0 0 0 0%

Other 0 0 0 0 0%

Table 5.12. Seed Sales by Medium-Sized Agro-Dealers in Yangon Region 2014

Products

Sales (bags/baskets) Current Prices per Unit Markup

2012 2014 Buying Selling Kyat %

Rice Hybrid 1 1 4,000 4,400 400 10%

Other Rice 2 4,100 12,000 13,000 1,000 0%

Maize Hybrid 1 100 5500 6,050 550 10%

Other Maize 0 0 0 0 0 0%

Green Gram 1 50 4,200 4,620 420 10%

Vegetables 3 1,050 7,700 8,225 525 7%

Other 0 0 0 0 0 0%

Other 0 0 0 0 0 0%

59

Table 5.13. Seed Sales by Small Agro-Dealers in Yangon Region 2014

Products

Sales (bags/baskets) Current Prices per Unit Markup

2012 2014 Buying Selling Kyat %

Rice Hybrid 0 0 0 0 0 0%

Other Rice 0 0 0 0 0 0%

Maize Hybrid 0 0 0 0 0 0%

Other Maize 0 0 0 0 0 0%

Green Gram 0 0 0 0 0 0%

Vegetables 1 500 1,500 1,650 150 10%

Other 0 0 0 0 0 0%

Other 0 0 0 0

60

Annex 6. Pesticide Sales and Margins for All Agro-Dealers by Region

Products

Sales (bags)

Units

Current Prices per Unit Markup Markup

No. of dealers 2014 Buying Selling Kyat %

Ayeyarwaddy Phyuradan 15 kg 3,823 2,969 3,294 325 10.94%

Cyperpar 16 liters 6,410 8,428 9,694 1,266 15.02%

Ahweindo 5 liters 130 9,800 11,000 1,200 12.24%

Cyclone 11 liters 3,150 9,982 11,836 1,854 18.57%

Average/dealer 16 1,152,125

Bago Phyuradan 12 kg 6,490 2,644 3,334 690 26.08%

Cyperpar 11 liters 5,020 5,873 7,170 1,297 22.09%

Ahweindo 2 liters 50 8,650 10,435 1,785 20.64%

Cyclone 10 liters 6,630 8,308 10,531 2,224 26.76%

Average/dealer 12 2,483,873

Yangon Phyuradan 3 Kg 2,200 2,100 2,205 105 5.00%

Cyperpar 3 Liters 1,000 7,500 7,875 375 5.00%

Ahweindo 0 liters 0 0 0 0 0.00%

Cyclone 3 liters 1,000 8,333 8,750 417 5.00%

Average/dealer 3 340,889

Total

Average Phyuradan 30 kg 12,513 2,648 3,123 475 17.96%

Cyperpar 30 liters 12,430 7,321 8,528 1,207 16.48%

Ahweindo 7 liters 180 9,481 10,843 1,363 14.37%

Cyclone 24 liters 10,780 8,799 10,747 1,948 22.14%

Average/dealer 30 1,608,377 19.30%

61

Annex 7. Scope of Work

Fertilizer Sector Improvement (FSI) Myanmar

Scope of Work

Agro-Input Dealer Survey

February-March 2014

Name: Ian Gregory

Duration: February 27 – March 27, 2015 (Total 21 work days plus 4 days for travel)

Reports to: FSI Chief of Party (COP) or his designee.

Background

The USAID Mission in Yangon, Myanmar, secured funding through a modification of the award

number AID-OAA-10-11—00003-00 (IFDC Grant) for the Fertilizer Sector Improvement

Project in April 2014. This project is essentially designed to introduce fertilizer deep placement

technology into Myanmar for improved rice and vegetable production and profitability over a

three year period. Trials have been established on rice in three regions for the 2014 monsoon

season, namely Ayeyarwaddy, Bago and Yangon Regions. A fertilizer policy assessment was

completed in August 2014.

The Myanmar fertilizer market is small by Asian standards at an estimated 1,200,000 mt of

inorganic fertilizers annually, comprised of mainly urea, and a range of NPK compound and

blended fertilizers. All fertilizer is imported, except for about 200,000 mt urea which are

produced by three of five state-owned urea plants operating on restricted supplies of natural gas.

Most imports enter the country by road from China.

There are 280 registered private sector fertilizer importers/manufacturers and 3,093 licensed

private sector fertilizer retailers. However, it is reported that there is a large quantity of informal

trade, especially from China, and also many reports of “fake” fertilizer. The sector is regulated

through the Fertilizer Law (The State Peace and Development Council Law No. 7/2002).

This is fairly comprehensive but suffers from many deficiencies that need to be addressed,

including poor enforcement of quality standards and labeling.

Fertilizer use by farmers is insufficient for optimum yields and farmers generally have little

knowledge of best agricultural practices and plant nutrition requirements.

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Purpose

The purpose of this study is to survey a representative sample of agro-input dealers in the

Ayeyarwaddy, Bago and Yangon regions of Myanmar in order to characterize these businesses

and segment them by resource level, capabilities and inputs knowledge. These dealers are

integral to the objectives of the FSI project. Their capacity to provide factual technical and

economic information to their farmer customers on the appropriate selection of inputs such as

fertilizer, seeds and pesticides for crops is essential to meet the FSI objectives. Identification of

training needs will be a prime output of the survey. In addition identification of some of these

dealers will be made who could produce urea briquettes for the UDP market development

program of FSI.

Specific Tasks for the Consultant

1. Design an appropriate questionnaire for the survey and in conjunction with the FSI M&E

staff field test the questionnaire.

2. Conduct interviews with the randomly selected dealers.

3. Analyze the survey results and present recommendations for training and other project

related activities.

Method:

1. The consultant with the project M&E specialist will obtain the full list of registered dealers

for each region from the LUD of the MOAI prior to field work.

2. Using random numbers, a 7% selection of dealers will be made from each regional master

list.

3. The consultant with the project M&E specialist will interview a 5% random sample of

dealers in each region on the following timetable:

Week Days Interviews Region No./Region

Mar 2-7 6 18 Bago 18

Mar 9-15 1 3 Bago 3

3 9 Yangon 9

2 6 Ayeyarwaddy 6

Mar 16-21 6 18 Ayeyarwaddy 18

Mar 23-24 2 6 Ayeyarwaddy 6

Mar 25 1 0 Yangon

Mar 26 Depart

Total work days 21

Timing: Field visits will be made as above between March 2 and March 25, 2015. Data entry

will be made on a daily basis

Output: Analyze the survey results at headquarters and complete a report with recommendations

for FSI dealer development.