Sustainable tailor-made fertilizer production for improved farming in Madagascar Note: This project has been cancelled, because of the lack of support by local authorities and the deteriorated business climate in Madagascar.The applicant of this project is The Mauritius Chemical and Fertilizer Industry Limited situated in Port Louis in the Republic of Mauritius. The company started its fertilizer operations in 1975 as a manufacturer of complex NPK granular fertilizers. The local company is Agrival, a Malagasy company that was created in July 2010. Agrival is active in the animal feed industry. After three years, the company has become the country's major producer and distributor of animal feeds.The partners will establish a joint venture company.While the market for standard fertilizers (such as NPK 11-22-16, DAP and Urea) is efficiently supplied, there is a considerable gap in the market for specific blends. The present demand exceeds 6,500 tons per year. By producing blends Madagascar (which is not the case yet), the project partners aim to cut costs and the project will make agriculture more profitable by enabling even poorer farmers to fertilize their fields. Even more innovative is the fact that the NPK blends will be packed in 1, 3, 5, 10 and 25 kg bags. The project partners will pack in smaller volumes for small-farmers.The blending factory with a total capacity of 20,000 tons of NPK blends per year will be located in Toamasina the most important harbour of Madagascar.Corporate Social Responsibility (CSR)The project partners indicate that they are committed to professionally managing their business processes to produce an overall positive impact on society and environment and to prevent any negative effects. Labour standards of the joint venture will reflect the project partners current human resource policies. The joint venture will make sure not to use any child or forced labour and no child labour risks exist in their supply chain.Remuneration and working hours will comply with Madagascar labour laws. 29 full-time jobs will be created. Medical treatments ? not covered by standard Madagascar health insurance ? will be covered by the project partners. Furthermore, health and safety aspects will specifically be important with respect to handling dangerous goods. Employees will receive training on this matter.The joint venture will not tolerate any form of corruption. Through the local partner’s contacts and by following all administrative procedures in a correct manner, the joint venture will diminish this risk. Additionally, all business transactions will be included transparently in the company’s annual financial statements. These will be audited by an independent accountant.The joint venture will become member of the International Fertilizer Industry Association (IFA), which has developed a series of 12 principles for use in fertilizer operations globally. Members should follow these guidelines.Impact•	Employment and working conditionsThe least paid employee will earn 222% of living wages in Madagascar which are at 36 euro per month for one person.All employees will receive official labour contracts and good and safe working conditions. The joint venture will not make use of any form of forced or child labour, nor will they work with suppliers or sub-contractors that do. Working hours will respect applicable local law. Overtime hours will be voluntarily and will be paid at a premium rate.The company will recognize and respect the freedom of employees to choose whether or not to establish, or to associate with, any organisation and encourages employee participation, all employees will receive continuous training on the job. Furthermore, the project partners want to provide a working environment free of any form of discrimination.Fringe benefits will consist of medical insurance and a pension fund, all according to Malagasy law. Other fringe benefits include transport. The joint venture will reward outstanding employees with financial bonuses.•	Innovation / Transfer of knowledgeThe project will substituted imports of readymade NPK fertilizer blends by locally blended standard and customised NPK blends, directly from imported raw materials.The most innovative aspect relating to the product is the fact that farmers can have their soil analysed. Based on the soil analysis and the crop and crop’s growth stage, a custom-made NPK blend will be prepared for them.The production process is also very innovative: a state of the art computerised (including the computer-software programme Optiblend) blending equipment will be introduced to Madagascar.Furthermore, all blends will be made according to the Dutch BlendPlus! © certification system.Another innovative logistical aspect relates to packaging. The intention is to use sealed bags for one time use only. This way the clients have the guarantee that the contents of the bag are genuine qualified fertilizer. Also, differently coloured bags will be used for different blends so the blends will be easily recognizable to the farmers. The blends themselves will also have different colours as differently coloured granules will be mixed with the blend. Coloured brochures and posters where the relation between fertilizer and crop will be explained will be distributed amongst farmers.The NPK blends will be packed in 1, 3 5, 10 and 25 kg bags. (Imported NPK is only sold in 25 and 50 kg bags). The project partners will pack in smaller volumes for small farmers. This is completely new in Madagascar.•	Chain effectsImpact on local suppliersThe project partners will source as many services and inputs locally as possible. Local craftsmen will be hired to make repairs to the equipment, welders and carpenters will be hired regularly to carry out maintenance operations in and around the factory. Transport companies will be engaged to transport supplies and end products, as not all transport can be done by the joint venture. Transport of raw materials from the port to the blending site is not considered here and will require additional transport/employment.Safety clothing will be sourced locally to be provided to all employees working in the factory and visitors. Employees will need equipment like overalls, helmets, safety shoes, gloves, glasses etc.Impact on local customers or consumersThe project partners will substantially increase the knowledge and skills of local distributors of agricultural inputs and services. The partners will provide training to parties active in the local supply chain on the efficient use of fertilizers. In addition, local distributors will receive training on analysing and collecting of soil samples and on handling the equipment and software that is used in the processes. The knowledge of analysing soil samples is not only useful for the use of fertilizers, but also provides information on efficient soil usage. Through these skills, local distributors will be more qualified to advise their customers on best agricultural practices, thus helping them to maximize their yields.•	Impact on the sectorKnowledge sharing is a very important aspect of this project. Other commercial entities in the sector will receive training from the project partners on the optimum use of fertilizers and will be trained on soil testing. The project will play an important role in the improvement of agricultural practices in Madagascar. By installing the first NPK blending plant, the partners will contribute to a more productive agricultural sector.The project partners will collaborate with many other entities in the sector to spread the knowledge on the proper utilisation of fertilizers. Farmers and farmers’ cooperatives as well as coffee cotton and tea plantations will be involved, these organisations will be very important to reach the joint venture’s target group. The joint venture will also work closely together with knowledge institutes, like the agricultural department of the University of Madagascar. The company will have place for interns/traineeships coming from agricultural schools and universities on a regular basis.•	EnvironmentBy training farmers in the optimum use of NPK over-use of N will be reduced and thus the project will have a direct and positive effect on the environment.•	Position of womenOnly 2 women will be employed in high/medium level positions.•	Impact on food safetyDue to more effective (custom made) fertilizers the project will result to a better food security situation in the country.•	Impact on waterDue to the fact that less fertilizer will be used in a more effective way, fewer nutrients will leach into ground and surface water reducing pollution of drinking water. To establish a fertilizer blend factory with a capacity of 20,000 tons of NPK blends to be used on the local market.