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Abstract

This article contributes to a limited but growing literature challenging a core assumption that it is profitable for smallholder farmers in sub-Saharan Africa to use more fertilizer than currently obtains. Using panel data from Nigeria, Africa’s largest economy, we empirically estimated the effect of applied nitrogen on sorghum yields. We explored if fertilizer use was profitable for sorghum farmers and the conditions that could facilitate profitable use of the input. We found that while input subsidies or reducing the high transportation costs for securing inputs could increase the profitability of fertilizer use for sorghum farmers, increasing the yield response rate of applied nitrogen is a more effective approach to improve the profitability of fertilizer application for these farmers. This involves addressing key challenges smallholders’ face including poor fertilizer and soil quality, limited use of complementary inputs and management practices.

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