51% Rise in Food Import Sparks Price Hike Fears
Agriculture stakeholders have predicted a new cycle of food price hikes by midyear of 2025 following increased food imports in 2024.
The value of food imports in the previous year grew by 51.06 per cent to N3.78tn from N1.85tn in 2023. This is according to Foreign Trade in Goods data of the National Bureau of Statistics (NBS).
Stakeholders have linked this increase in food import value to the Federal Government’s 150-day duty-free import window (for selected foods) announced in July 2024 to reduce exorbitant food prices by making more food available.
Notably, stakeholders, including farmers and some members of the private sector, opposed the import waiver window, which recorded among its limited successes a consignment of 32,000 tonnes of rice from Thailand.
Before President Bola Tinubu’s temporary import waiver, the prevailing government policy largely restricted food importation. Findings revealed that the value of food imports had weakened by 0.54 per cent to N1.85tn in 2023 from N1.86tn in 2022.
Meanwhile, Economic Confidential reported that the price of food commodities in 2024 rose by 37.65 per cent. Market surveys reported food prices were declining, including in Kano State’s Singer Market, Junaidu Zakari.
Earlier in the month, the Federal Government hailed reports of a reduction in food prices in the market as a fulfilment of the administration’s promise to reduce soaring food inflation.
However, stakeholders are not as enthused by the increased value of food imports and warn of further food price hikes by midyear when the imported and harvested stocks are exhausted in the market.
President of the All Farmers Association of Nigeria (AFAN) Kabir Ibrahim, in a phone interview affirmed that whereas the import duty waiver window achieved its purpose of bringing food prices down, continuing importation to meet the country’s food availability is not sustainable.
Ibrahim warned that “Nigeria, with a population of 200 million and still counting, and an anticipated population of 400 million in 25 years, cannot afford to be importing to get food security or food sufficiency or food availability.”
He urged the country to work within itself to produce enough food to attain food security.
Further, Ibrahim advised Nigerians to brace for a return to higher prices by August as farmers are bogged down by continued high farming inputs including fertilisers, labour costs, and unfavourable competition with imported food.
“The farmers are crying that they are not getting real value for what they produce because of the imported (food) material that is there. So, what assurance can any farmer give you?” the AFAN president queried. “If the farmer cannot go back to his farm to produce more, you will still have (food) insufficiency later.
“It takes a long time for you to finish off what has even been imported before you start going back to those people. Around August, there is a likelihood of getting back to where we came from.”
The high price of food prediction may become a market reality sooner than imagined, as the earlier reported price crash has begun to regress as it gradually rises for some food items.
The Chairman of the Lagos Chamber of Commerce and Industry Agriculture and Allied Group, Tunde Banjoko in a phone interview said that more investment in storage would be a lasting measure as food prices have started going up.
“(The prices of) rice have gone up, garri and beans too. But we can still say that food prices dropped compared to what we had in maybe November to December 2024,” Banjoko noted.
He explained that harvest sales contributed to crashing food prices, which displays a bigger challenge of Nigeria’s weak food storage infrastructure.
“We do not have good storage in Nigeria, and farmers bring their produce to the market during the harvest period, leading to price crashes. But when we are done eating, our harvest price starts going up again. Price increases will even start skyrocketing by June.”
He lamented how the agricultural sector seems unable to overcome this challenge, as the country is still battling with seasonal farming practices.
The LCCI agriculture and allied group chair shared a similar view as the AFAN president on transitioning to a more sustainable practice of government subsidisation of the cost of production.
He maintained that farmers can produce enough food for the country’s population but they need better financing, mechanisation support and investment for increased use of silos.
He advised: “Get the Bank of Agriculture to work so that farmers can get the single-digit interest of 9% thereabouts, rather than borrowing money from commercial banks or microfinance at 30 to almost 48 per cent per annum.
“Governments at state and local government levels can also improve sustainability by setting up commodity boards so that farmers can be major uptakers, guaranteeing prices so that the cost of production will be secured at harvest.”
The Assistant to the President on Agriculture and the Executive Secretary of the Presidential Food Systems Coordinating Unit, Marion Moon in an exclusive interview said that the government is working through the PFSCH to ensure food stability by improving food availability, accessibility and utilisation.
Moon explained that the Federal Government adopted a policy stance to allow a limited period of importation during the duty-free window to balance the food accessibility problem.
He said, “Food availability is dynamic because of time and seasons. Food accessibility means it is one thing to have the food and another to afford it. Food utilisation checks whether we have a balanced diet. It asks how we are using food. Are we able to hit the nutrition targets?
“We had a big problem with accessibility. So, we said, okay, we must allow perhaps a little bit of access to bring in that food. But it’s a window because it’s for a period of time while we address something in availability.”
Marion explained that the food stabilisation quadrant is like blood pressure, and the government understands it needs to work closely with the government and private sector to ensure food stability.
