Nigeria’s Agricultural Sector Surged By 18.33% in Three Quarters of 2022
By Gilbert Ekugbe
Despite incidents that shaped the nation’s agricultural sector, the food sector witnessed significant growth that ushered fresh hope for farmers in 2023.
There is no gain saying that Nigeria is not immune to the failing agri food systems across the globe. Climate change, Russia-Ukraine conflict, insecurity, drought and flood to mention but a few are still challenges hindering the growth of global food systems. The World Food Programme (WFP) stated that the world is facing a food crisis of unprecedented proportions, the largest in modern history with millions at risk of worsening hunger unless action is taken now to respond at scale to the drivers of this crisis: conflict, climate shocks and the threat of global recession.
As many as 828 million people go to bed hungry every night, the number of those facing acute food insecurity has soared from 135 million to 345 million since 2019 while a total of 49 million people in 49 countries are teetering on the edge of famine.
According to the National Bureau of Statistics (NBS), the agricultural sector in the first quarter of 2022 grew by 3.16 per cent (year-on-year) in real terms, an increase of 0.88 percentage points from the corresponding period of 2021, and a decrease of 0.42 percentage points from the preceding quarter, which recorded a growth rate of 3.58 per cent.
It grew on a quarter-on-quarter basis at -28.90 per cent. The sector grew by 13.83 per cent year-on-year in real terms for the second quarter of 2022, a decrease of 1.96 percentage points from the preceding quarter which recorded a growth rate of 3.16 per cent and also a decrease of 0.10 percentage points from the corresponding period of 2021.
The sector also grew by 1.34 per cent year-on-year in nominal terms in Q3 2022, showing an increase of 7.47 percentage points from the same quarter of 2021.
Capital importation into Nigeria’s agriculture sector increased by 3,161 per cent from $1.76 million in the first quarter of 2022 to $57.41 million in the second quarter of 2022. This meant that there was a 3,161 per cent growth within three months.
However, the value of foreign investment in the sector tumbled 99.23 per cent from $237.83 million that was recorded in the fourth quarter of 2021 to $1.76 million.
The NBS’ Nigerian Capital Importation report for Q1 2022 blamed the declining local and foreign investors on insecurity, adding that $59.17 million of capital was imported into the agricultural sector in half-year 2022, down by 74.9 per cent from $235.87 million in the same period of 2018.
In the first three months of 2022, foreign investments in the country’s agricultural sector stood at $1.76 million, a 98.7 per cent decline from $130.90 million in the same period of 2018.
Skyrocketing food prices
The year 2022 witnessed a significant increase in food prices. Many Nigerians celebrated the yuletide season on a low profile due to declining purchasing power of consumers. Prices of common staple food such as rice, beans, wheat, cassava have continued to hit the roof while many Nigerians go to bed hungry on a daily basis.
Early in the year in January 2022, President, Muhammadu Buhari, unveiled the rice pyramid in Abuja, saying that it would drastically crash the rising price of rice in the countryB but sadly, the price of rice has continued to experience continued increase.
The 13 rice pyramids comprising 1.2 million units of 100kg bags of rice were said to be the biggest on the continent with each of the pyramids containing about 115,000 bags of 100kg each. According to the latest price in the market, a 50kg bag of locally produced rice goes for between N38,000 and N41,000 as against the N28,000 to N30,000 sold before the launch of the rice pyramids.
Many stakeholders in the agricultural sector described the unveiling of the rice pyramid as a hoax to deceive the impoverished Nigerians. It raised false hopes.
Just as the world was recovering from the COVID-19 pandemic, in February 2022, the Russian incursion on Ukraine triggered the prices of wheat and as expected the prices of commodities dependent on wheat increased by 50 per cent. Both Russia and Ukraine rank among the top five exporters of wheat and maize globally. The two countries supply 30 per cent of the world’s wheat and 20 per cent of maize to global markets.
As a result of the conflict, the Nigeria Bakers Association announced a 50 per cent increase in the price of bread, which brought untold hardship to the already impoverished consumers of bread in the country.
The Nigeria Economic Summit Group (NESG) in its report titled “Implications of Russia-Ukraine War: Risks and Opportunities for Nigeria,” called on the federal government to take urgent steps towards improving food security in Nigeria and removing constraints on the production and supply of agricultural products to the market.
It said that the move would enable the country to mitigate the negative impact of the Russian war on Ukraine on the food supply in the country.
Also in the year, participants at a National Stakeholders Consultative Meeting on the 2023 Agriculture Budget said the Nigerian food sector is confronting new emerging challenges such as the ongoing Ukraine-Russia war, which affects input prices and the availability of staples such as wheat.
They also stated that the challenges of increased banditry, farmer-herder clashes, climate change, floods, hazardous pesticides, and gender inequality persist, and without a deliberate rethink of the nation’s practices and approaches towards its food and nutrition security, the federal and state governments would not be able to eradicate these agricultural economic growth barriers.
Threat to food security
Nigerian farmers and agronomists have expressed concern that widespread insecurity in the North-eastern part of the country and higher prices of farm inputs in the country are shrinking the number of hectares put to food cultivation, warning that the situation would affect the productivity of farmers in the 2022/2023 wet season.
Stakeholders in the food sector have continued to lament on the need for Nigeria’s economic managers to redesign its security architecture to combat insecurity as many farmers are still unable to return to their farms owing to fear of being kidnapped or killed in the process. No doubt, the prices of food items have been affected as a result of this with more Nigerians struggling to have three square meals on a daily basis.
According to Proshare, farmers have become the main target for kidnapping by gunmen, bandits and armed herdsmen across various geopolitical zones in the country, adding that in a rift between two communities in Kaduna this year, at least eight farmers were abducted and eventually killed. “Kidnapping has become a common occurrence such that farmers in some Northern states even go ahead to pay tax and harvest fees to bandits in order to avoid attacks,” Proshare added.
“Since July 2020, basic food items like beans and tomatoes have seen a 253 per cent and 123 per cent price increase respectively, thus, putting a lot of people at the risk of starvation. Since the start of Boko Haram insurgency in 2009, there has been a rise in starvation index. There has also been a 140 per cent surge in Nigeria’s food import bill, as present production levels cannot meet the country’s ever-increasing demand for food, “Proshare averred.
The Chief Executive Officer, Centre for the Promotion of Private Enterprises (CPPE), Dr. Muda Yusuf, in a telephone chat with THISDAY, said that insecurity is still a major challenge hindering the nation’s food security. Yusuf added that many farmers have been driven out of their farms, many in Internally Displaced Person (IDP) camps and those risking to farm are farming in fear, which in turn had affected the productivity of farmers.
“The challenges are still there as we speak. Flooding destroyed the farmland of many farmers across the country and it had a very negative impact on agriculture during the year. We also have the challenge of foreign exchange where some agricultural input is normally imported and you know the situation of foreign exchange in the country. The cost of agriculture input went up dramatically and it affected the profitability of agricultural investment in the country.
“We also had issues of community where some of these corporate organisations invested massively in plantations but are facing problems from the community with the community demanding all manners of things from these organisations. Access to land is also not easy for those who want to do mechanised agriculture,” he lamented.
He pointed out that lots of the youths have left the rural areas to the city as the farming population is ageing, calling on the need for economic managers to invest massively in agritech.
“Young people are not staying or going into agriculture, because there is not enough technology in agriculture. Nigeria’s greatest asset as far as human capital is concerned is its youths, but we have not been able to deploy them to agriculture because we have not introduced enough technology in agriculture.
“The farming population is ageing. The quality of technology used in agriculture is also not there. Many of the agricultural research institutes are all over the place but poorly funded. This is why we are not seeing the impacts of these research institutes that are all over the place,” he added.
In his words: “We also need to develop the value chain of agriculture, because agriculture is not only about primary production, but also about the value chain. Unless we develop the value chain, those at the primary end will also not make any meaningful progress. Post-harvest losses are extremely high, sometimes as high as about 50 per cent and it is more when you compare with fruits and vegetables.”
He said that the sector’s growth performance of 1.34 per cent in the third quarter of 2022 was not good enough, saying that the growth is a clear demonstration of resilience on the part of farmers in the country.
He emphasise the urgent need to incentivise farmers and reduce the cost of farm inputs to boost productivity and profitability of farmers.
“We must address insecurity if we want to help agriculture. We also need to address the high cost of input for crop production, livestock and fishery, poultry and forestry.
“All their inputs, particularly every component of their inputs that are imported, have become extremely expensive. We expect the new administration to take the bull by the horn. There should also be special programmes to encourage youths to embrace agriculture.
“We can only achieve this if we fuse technology into agriculture to make the sector a lot more stress free. We need to harness the energy, creativity and innovation of the young people and the only way to do that is to deploy technology. We must also invest to develop processing, strengthened marketing and exports,” he recommended.
On his part, the National President of All Farmers Association of Nigeria (AFAN), Mr. Kabir Ibrahim, said that 2022 has not been very good to farmers, saying that farmers were hopeful of a bumper harvest in 2022 until flooding ravaged farmlands across the country.
He also lamented over the state of insecurity in the North-eastern part of the country, maintaining that insecurity and floods have drastically impacted on the productivity level of farmers across the country.
“People were complaining that they could not celebrate the yuletide because of the high prices of food items especially at a time when the purchasing power of consumers is dwindling.
“We are advocating that agriculture is an activity we can do all year round, but we are hopeful that we might see some growth in 2023,” he stated.
He said that all the programmes and policies of the federal government to transform the nation’s agricultural sector are laudable, but said implementation has been poor.
Going forward into 2023, he advised that farmers must be incentivised to produce more while also calling on the government to institutionalise the Central Bank of Nigeria’s (CBN’s) Anchor Borrowers Programme (ABP).