The Distribution Channels for Fertilizers Sample Clauses

The Distribution Channels for Fertilizers. In most cases large companies obtain access to fertilizer gifts by donors. They possess the distribution operations. Donors need to recover a part of their gifts through sales that are then utilized for development projects. The State determines the amount to return to the operators take into account the recovery cost of the State, which could be considered as a purchasing price of the products given to Madagascar. They also add the expenses of Importers can also buy fertilizers directly from world market, but in this case they have to pay higher prices and finance their operation through bank credit. Often they are enter into agreements with agencies involved in agricultural production. The importer in this case, acts as a middle man. The distribution is carried out by the agency involved in production. A third method consists in direct imports by a development organization, which is often a branch of an industrial unit which needs an assured supply of inputs for the production of an industrial crop. This is the case of SIRAMA for the production of sugar cane, SOCTAM for tobacco, COTONA and HASYMA for cotton. These are the crops which use more than 50% of the fertilizer in Madagascar. Just after the withdrawal of the State from the input distribution sector in 1985, donors' gifts constituted a high percentage compared to that of total imports. The Ministry of Agriculture, on the basis of the management of supply had the task of allocating these gifts among different distributors. The payment was staggered and in most of these cases, served to finance the counterpart of funds in order to realize the development projects or public investments. Unfortunately, certain distributors could not make the payment in time or at all. The donors then suspended their support in 1991. Just after the liberalization of distribution in 1986, no commercial agency imported fertlizer. The next year, a massive import by private operators of 23,200 tons coincided with a similar quantity arrived under the form of gifts. This situation led to a considerable decrease in imports for the next year 1988. This situation repeated itself in 1992. When the gifts didn’t exist, the importers reacted positively to this situation. However, the return of gifts in 1994 dimininished the part of importers in the fertilizer sector. The erratic behavior of imports coexists with a stagnant behavior over the long term, even though years of strong imports and gifts are followed by virtual no imports ...