IN Nigeria, The rise in the exchange rate affects virtually everything. If the naira value of the dollar increases overnight, we wake up to a morning where the price of garden egg increases, and so does the price of mangoes! So the fall in the value of the naira against the dollar has caused for a huge price increase of food items in the country. It is important to differentiate or clearly define our food situation in the country.
Nigeria doesn’t have a food scarcity crisis, but rather, an escalation in the prices of food items which has made them barely affordable to the common man. Raids across the country by consumer protection agencies as well as security agencies, has proven that, there are thousands of metric tonnes of grains hoarded in warehouses by marketers. This on its own has driven prices up, aside the dollar-rate induced inflation.
This is being stemmed and prices, even if marginally, have downed a bit for locally produced grains. The market practice of mopping up food items from farmers, processing them, and ware-housing them for a period of time to make a kill in the price margin is an age old venture. This season’s is felt the most because of the more sinister dollar angle.
The very high prices of food items was further compounded by wholesalers of grains exporting them to neighbouring countries as the naira value plummeted. Niger Republic and other neighbouring countries CFA currency is trading at 2.21 naira to 1 CFA. So the markets were flooded by marketers who were coming in to make a kill. Food in Nigeria now is twice cheaper than in our neighbouring countries.
So local prices shored up drastically from the exportation of our food supply. The situation was aggravated by the absence of a budgetary provision for the dry season farming of 2023, which usually augments any shortfalls in our food supply in the country. A supplementary budget was passed late last year by the new administration to make way for the dry season farming of 2023.
So in November of 2023, an aggressive dry season wheat farming initiative was launched by the Federal Ministry of Agriculture and Food Security. A 50% discount on farm inputs, costing about 361,000 naira per hectare, was provided to the farmers, covering fertiliser, pesticides, and an improved variety of grains. These grains include the Borlaug 100 and the Attila, which have more than triple the yield of the local/ previously used varieties.
The new variety is also more rust resistant. No less than 200,000 farmers were supported, cultivating about 250,000 hectares of land with an expected yield of 1,250,000 metric tonnes. After that, in late January this year, The Ministry of Agric announced that 100,000 metric tonnes of grains, 42,000 from government’s strategic grain reserves, and another 60,000 to be bought off major dealers, would be distributed across the country, free, to the less privileged citizens.
This is to help stem the demand and make food available to those who cannot afford the goods due to the high prices. This will in turn drive down prices. Presently, the grains are being bagged and transported to allocated destinations across the country for onward distribution.
Furrhermore, The Federal Ministry of Agric is embarking on another dry season farming, this time concentrating on rice, cassava and maize. 500,000 rice farmers are being targeted, to cultivate atleast 250,000 hectares, with an anticipated yield of 1 million metric tonnes. For maize, 110,000 farmers are being targeted, to cultivate 55,000 hectares of land, with an anticipated yield of 165,000 metric tonnes of maize.
As for cassava, 75,000 farmers are being earmarked to cultivate 35,000 hectares, with an anticipated yield of 525,000 metric tonnes. This is being driven by the Agric Ministry’s National Agricultural Growth Scheme Agro-Pocket Project. This scheme as earlier stated provides 50% input subsidy to farmers, which is being progressed to a second phase where farmers will enjoy a 93% subsidy.
From all indications, The wet season farming will be witnessing a considerable reduction or perhaps a subsidy in the price of fertiliser. From the Honorable Minister of Agric’s presentation at the last NEC meeting, raising concerns about the price of fertiliser, from the dollarisation of local commodities like urea, The Vice President, Sen. Kashim Shettima had called for a meeting with major fertiliser producers in the country such as Dangote, Indorama and Notore.
This alone would drastically reduce the costs incurred by farmers as fertiliser is the one most expensive input utilised by them. Also in the furtherance of mechanised agriculture, The Hon. Minister of Agric, Sen. Abu Kyari had earlier announced that the Agric Ministry, in collaboration with John Deere, an Agricultural machinery company, would be providing 2000 Tractors annually, which would be sold to Nigerian farmers at very affordable prices, with very low interest rates. This is aimed at boosting the all year farming drive of the Agric and Food Security Ministry.
Food security is definitely within sight and it is envisaged that by the next dry season farming coming in 8 months, when the country would have eventually achieved the all year farming season, local food supply would be massively improved, and hopefully with a lot more for exports.
This would greatly improve on the diversification of our economy, shoring up the inflow of foreign exchange, which is the bane of our economic woes presently. The President has ruled out the importation of food items for food sufficiency and that is the way to go. Our problem is not the insufficiency of food, but the escalating prices of food items.
Tahir is Talban Bauchi.