February 9, 2024/CSL Research
Based on news report, the Minister of Information and National Orientation, Mohammed Idris, has announced that food items would be released from the storage facilities (the National Food Reserve) across the country as part of measures to reduce food prices.
This was made known after the meeting of the Special Presidential Committee in Emergency Food Intervention. Idris also
noted that major millers and commodity traders would be engaged by the government. Food inflation jumped by 10.18ppts to 33.93% in 2023, reflecting risks like insecurity, adverse climate, and high input costs.
Insecurity, a significant factor prompting many farmers to abandon their farmlands, along with climate-related changes, escalating input costs due to the devaluation of the Naira, and disruptions in the supply chain have collectively contributed to the soaring food prices in Nigeria.
One critical element exacerbating this issue is the country’s heavy reliance on imports of Muriate of Potash (MOP), a vital component for blending agricultural inputs, sourced primarily from Russia. Unfortunately, the imposition of sanctions on Russia has entangled this essential supply chain, further complicating the challenge.
The escalation in food prices is also influenced by elevated transportation costs resulting from the removal of subsidies on Petroleum Motor Spirit (PMS). Additionally, there are allegations of opportunistic individuals exploiting the situation by hoarding food items, anticipating a depreciation of the Naira, and intending to capitalize on selling these items at inflated prices to maximize profits.
President Bola Tinubu’s declaration of a “State of Emergency” on food insecurity last year has not translated into a reversal of the persistent upward trend in food prices. It is evident that critical issues affecting food production remain unaddressed. Urgent and proactive measures are imperative in 2024 to bolster food production and mitigate the looming risk of a potential food crisis.
Such a crisis could not only jeopardize the health of the active population but also impede economic growth. Tensions are already escalating, underscoring the pressing need for a comprehensive and feasible plan to be formulated. The government must prioritize resolving the root causes of these challenges to ensure sustainable solutions that go beyond symbolic declarations.
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