By Onome Amuge
- Traders, consumers bemoan rising cost of food
The Easter holiday, particularly for Christians, is a globally recognised period of merriment and joyous celebrations. However, one of the most basic items associated with the festivity, food, has become a source of concern, deep sighs and unfeigned lamentations for many Nigerians as the country, yet again, has seen a surge in the prices of food items.
Barely three weeks before the festive season, the National Bureau of Statistics (NBS) in its Consumer Price Index (CPI) report for February 2021, revealed that the food inflation rate of the most populous African country had jumped to 21.79 per cent, the highest recorded rate since October 2005.
The Abuja-based statistics office attributed the rise in the food index to an increase in the prices of staple food products especially, bread and cereals, meat, fruits, vegetable, fish and oils and fats, potatoes, yam and other tubers.
More so, the food sub-index increased by 1.89 per cent month on month in February 2021, 0.06 per cent points higher than the 1.83 per cent recorded in January 2021 and on the yearly average, the rate of change in the index was 17.25 per cent, 0.59 per cent points from the average annual rate of change recorded in January 2021 at 16.66 per cent.
On an annual average, Kogi State was the hardest hit as it recorded 30.47 per cent food inflation rise, followed by Ebonyi (25.73 per cent) and Sokoto (25.68 per cent). On the other hand, Gombe recorded the lowest food inflation rate at 19.32 per cent while Bauchi’s 18.74 per cent and Akwa Ibom’s 18.70 per cent were the second and third lowest respectively.
Kogi state also recorded the highest monthly average at 3.34 per cent, followed by Ondo (3.33 per cent) and Ebonyi (3.26 per cent), while Benue and Niger registered the lowest monthly average at 0.90 per cent, Kano (0.70%) and Oyo (0.09%) recorded the slowest rise during the review period.
The aforementioned figures released by the NBS, despite being a proof of the country’s critical situation can easily be dismissed by some critics as mere figures or interpretations calculated to portray the country in a negative light, but there is no denying that the real impact of the reports is genuinely felt in the market places where money is exchanged in the purchase of food.
In light of this, Business A.M. conducted a survey of food prices in major markets across the country and the resultant effect on traders and buyers.
Rukayat Fadeyibi, an egg trader at the Oja-Oba market in Ado-Ekiti, Ekiti State, disclosed that a crate of egg which sold for N1,200 in January is currently N1,500. “My customers are not happy about the current price and some of them have been complaining, thinking the egg sellers are intentionally raising the cost of eggs,” she said.
Mathilda Eno, a primary school teacher, said a paint rubber of white garri, which previously sold for N700 now costs N950 at the Atan market in Ogun State.
“My mum used to buy a bag of beans for N18,000 at the Aduwawa market. Last year, we screamed when we discovered it had risen to N25,000. Presently, it is being sold at between N40,000-N43,000. The hike has made it more difficult for my mother to manage her business,” bemoaned Victoria Mbachu, a student of the University of Benin, Edo State, whose mother deals in the sale of akara (bean buns).
Ndubuisi John, a car mechanic in Abule Egba, while lamenting the surge in price of food commodities, disclosed that getting a cold soft drink to refresh his body after a hard day’s job had become more difficult for him as the cost of a 50cl plastic coke and pepsi now sell for N120, a 20 per cent increase compared to the previous rate of N100.
Apariola John, a civil servant based in Dutse Makaranta, disclosed that a basket of potatoes which previously sold for N500 now sells for N800 at the Dutse-Alhaji market in Abuja.
At 360bakery, Ajao Estate, Lagos State, a loaf of bread, which previously sold for N300 has jumped to N350 while the sardine and coconut bread varieties previously sold for N400 has risen to N500. One of the bakers who chose to speak under anonymity disclosed that the cost of production ingredients, notably flour and sugar, had skyrocketed and it would be almost impossible for them to make any profit without increasing the prices of baked bread.
Business A.M.’s market survey also shows that a 25-litre gallon of vegetable oil, which sold for about N17,000 in December, 2020 has climbed to an average of N20,000.
With many Nigerians continually finding it difficult to defend their bellies against the pervading food inflation woes while uncertainties about what the coming weeks hold persist, it is evident that the country whose populace is estimated at over 200 million is in a critical situation that calls for the crucial intervention of the government and stakeholders involved in the food production and supply sectors, analysts said.
In its assessment of the country’s agricultural sector and the worrisome food inflation figures, PwC, a leading financial audit management firm, noted that Nigeria’s agricultural sector has recorded a steady growth overtime, at an average of three per cent in the last five years, but that the country is yet to attain food sufficiency.
The business consultancy firm attributed this to factors such as the farmers-herders’ conflicts, insecurity in the northern region, widespread adoption of unsophisticated farming techniques, lack of adequate infrastructure which pose major challenges to the industry. Agricultural products, PwC noted, are still moved across the country on bad roads leading to wastage of products while storage infrastructure for the produce is lacking in most places.
PwC advised that government and private sector investors will need to equally focus on providing the necessary infrastructure to complement the primary agricultural production and optimise value for the industry.
“Given that the bulk of farmers, especially small holders cannot afford outright purchase of equipment, expanding the list of exempt services to local farmers which will include hire, rental or lease of tractors, ploughs and other agricultural equipment is expected to drive down production and transportation costs for the majority of farmers. This exemption may also encourage mechanized farming in Nigeria which will enhance production capacity and quality of produce,” it stated.
Africanfarmer Mogaji, an agriculture consultant and chief executive officer, FarmCredit, an agribusiness investment platform, said the recurrent food inflation crisis is a cause of concern to every Nigerian irrespective of social status.
According to Mogaji, challenges such as climate change, insurgency, kidnappings and clashes between cattle herders and farmers have dented production in the agricultural sector. He added that the nationwide strike and food blockage to the southern region of Nigeria imposed by the Amalgamated Union of Foodstuffs and Cattle Dealers in Nigeria (AUFCDN) in the first week of March is still currently taking a toll on food availability in the country. Mogaji recounted that during the duration of the strike, tomato farmers recorded a loss of 10 million naira while traders in the south also lost millions of Naira in food investments, a situation that has indirectly created a huge problem in the food system.
He accused food trade unions and middlemen in the food distribution sector of exhibiting unnecessary authority in their role as linkages between the farmers (food producers) and marketers. The middlemen and trade unions, he said, are more concerned about personal gains in contrast to harnessing fluid relationships with the value chain in terms of producers and consumers.
“Anything they do affects the farmers. If the farmers are discouraged, their resultant actions could lead to food insecurity and if the consumers don’t get the food to buy, it leads to frustration and unrest,” Mogaji said.
Speaking on the way forward, Mogaji noted that the Anchor Borrowers’ Programme facilitated by the Central bank of Nigeria (CBN) has been effective based on the original design but going forward, the project initiative needs to be reappraised and scaled lower to benefit the farmers who need it the most.
The FarmCredit CEO also stressed that it is mostly people with large farmer networks that really have access to the funding whereas it is needed to encompass small, medium and large scale farmers in such a way that it can trickle down to the average farmer especially in situations where many of the farmers are in dire need of farm implements and storage facilities to boost food production level.
He added that the policies of the programme need to evolve and embrace developing trends and also extend to other sectors such as the long term production crops, including coconut and oil palm.
“Presently, Nigeria’s agricultural policies are more potential than structural and for the agricultural sector to achieve sustainability, they should be more developed and long-term structured,” he said.
He expressed optimism that the agricultural sector is expected to experience better growth buoyed by the decreasing effects of the covid-19 pandemic and increased rate of vaccination which will automatically encourage more farmers to engage more in farming in comparison to the lowered rate of farming last year occasioned by the covid-19 pandemic. He added that states and regions are going back into regional production which is likely to develop the value chain of processing which is very crucial to food production.
Ademola Odesanya, founder, Agric-Ville Ventures, an organic breeding farm for poultry birds, said the hike in the prices of chickens, eggs and other poultry derivatives is a result of a dip in supply and high cost of maize and soybean which are notably the most basic ingredients in the production of chicken feeds; thus explaining how this challenge has affected production capacity of many poultry farmers.
Odesanya said that the cost of operating a poultry farm has doubled and many workers and farmers have been forced to look for alternative sources of livelihood because even the prices which the chickens and eggs are sold to the consumers is not enough to compensate for the cost of production and sustaining their businesses. He suggested that the government need to adopt more strategic, innovative and aggressive measures and a comprehensive economic long-term policy to ensure food security rather than keep implementing archaic and temporary agricultural projects which never yield the desired results.
She explained that inflation is unlikely to make improvements if the predicaments hindering the agriculture sector and value chain remain unresolved.
Nigeria, she noted, is endowed with good arable land, weather and water supply and has the potential to be self-sufficient in food production and even go beyond sufficiency and become a valued exporter of food. She opined that the inflow of foreign investment and technology in the sector would enhance the country’s agriculture potential and also improve the output of domestic industry. This, according to her, would improve food security and earn the country a better position in its balance of payments, a basic requirement to boost economic welfare and tackle food inflation effectively.