Despite the recent appreciation of the Naira against the dollar, a sigh of relief for many Nigerians, experts have cautioned against expecting a swift reduction in the prices of foodstuff and other agricultural commodities. The official figures reveal a significant gain for the Naira, closing at N1309/$1 at the end of March from N1595.11/$1 at February’s end. This 21.8 percent appreciation is a testament to the Central Bank of Nigeria’s (CBN) efforts through various forex policies, strategies, and interventions aimed at stabilizing and strengthening the national currency.
However, the anticipated positive impact on the cost of foodstuffs remains unrealized, with Nigerians still facing high food prices. Ruth Suberu, CEO of Oreka Farms Limited, pointed out that factors such as insecurity, high input costs, and the cost of fuel continue to escalate food prices. The farming process, from planting to harvest, involves stages that were significantly affected by the high exchange rates, impacting input costs used at various stages. Additionally, the scarcity of labor due to insecurity, leading some farmers to abandon their farms, exacerbates the problem.
Adenike Apeji, CEO of Renee Golden Multiventures, highlighted the lack of mechanization in Nigerian agriculture as a primary challenge. With mechanization levels at a mere 10 percent compared to 90 to 95 percent in developed nations, the capacity to meet the food needs of Nigeria’s population is severely hampered. Security concerns also remain a critical area needing urgent attention to encourage more cultivation and improve the situation.
Durodola Omolewa Kuteyi, an industrialist, echoed these sentiments, noting that factors such as the high price of diesel and key raw materials like sugar have not seen reductions, making it unrealistic to expect a decrease in the prices of finished products. For instance, the cost of cocoa has tripled, affecting local processors due to high demand from exporters willing to pay the increased prices.
Experts agree that addressing these multifaceted challenges requires a holistic approach beyond currency stabilization. The government’s efforts need to focus on encouraging agriculture and food production through mechanization, addressing security concerns to enable farmers to return safely to their farms, and considering the impact of input costs and fuel prices on food production.
Chief Femi Oke, Chairman of the All Farmers Association of Nigeria (AFAN) Lagos State Chapter, expressed optimism that commodity prices would eventually decline. He emphasized that the process would be gradual, considering the high costs incurred during periods of unfavorable exchange rates.
The situation underscores the complexity of Nigeria’s food crisis, suggesting that a multi-pronged strategy involving improved security, investment in agricultural mechanization, and strategic interventions in the forex market are essential for achieving a sustainable reduction in food prices. As Nigeria navigates these challenges, the collaborative efforts of the government, agricultural stakeholders, and the community will be crucial in ensuring food security and economic stability in the long term.
