AFEX raises alarm on severe food crisis in Nigeria
…As food shortage hits 5.7 million metric tonnes
…Forecasts 32% rise in cost of rice by 2024
AFEX has raised alarm on a severefood crisis looming in Africa’s largest economy, Nigeria.
At the unveiling of its 2023 Crop Production Report, AFEX highlighted food insecurity and food inflation as a major challenge for Nigeria, with a 5.7 million metric ton shortage across human consumption and agro processing, and a historic high food inflation rate of 30.64 percent.
AFEX being a platform business that enables efficient trade for commodities in Africa highlighted major factors as causes of food shortage in Nigeria, which had pushed the country to 109th out of 125 countries as indicated on Global Hunger Index, and described it as alarmingly high, indicating a severe food security crisis.
The President/CEO of AFEX Nigeria, Akinyinka Akintunde, speaking at the launch event said, “This year, we nearly doubled our sample size from 20,677 to 39,091 to get an accurate reflection of the current state of Agriculture production, and we found that we must take extra care to prioritize improvement in agricultural productivity for these farmers, and this is hinged on investing in the sector, and solving for infrastructure, logistics, and technology gaps.
“This transformation will substantially enhance food self-sufficiency and increase our ability to meet the nutritional and food security needs of a growing population while also bolstering the economy through foreign exchange earnings.
“A recurring limitation for agriculture on the continent is a shortage of reliable data, which affects the availability of transparent pricing and limits, on one hand, participation from the side of capital market operators and largely financial market players and on the other hand, farmers’ ability to negotiate equitable contracts for themselves.
“This report attempts to build that gap by building a reliable data bank to promote market education and facilitate accurate trading decisions.”
According to the report, the price of food commodities will continue to soar due to reduced production.
Solutions start at the producer level, ensuring improvement in productivity and livelihoods while building up commodity volumes in the right quality and quantity for local and regional trade.
The report forecasts higher prices for Paddy rice, Soybean, Sorghum, Cocoa, and Sesame.
On pricing, the report forecasts an increase in prices for all commodities on the basis of a general decline in production coupled with increasing demand for across processing and exports.
Paddy Rice which faced the most notable upswing in 2022/2023, partly due to increased flooding and the India rice ban that contributed to an increase of 34% and a baseline pricing of NGN353,000/mt, which is expected to rise to NGN400,000/mt and projected to stabilize at NGN480,GN500,000/mt by Q3 2023.
Meanwhile, the six key commodities (Maize, Paddy rice, Soybean, Sorghum, Cocoa, and Sesame), which leveraged on farmer surveys and measurement of transaction-level data to track vital information across crop production, price performance, and market dynamics.
This threatens the country’s role in achieving zero hunger by 2030.
However, the report also indicates an increase in access to farmland for cultivation in crucial areas.
According to the report, there is an increase in the usage of improved inputs, such as high-yielding seeds and fertilizers, compared to last season, which contributed to Maize and Paddy rice being forecasted to have a significantly higher production this season.
On the other hand, input lending remains a major challenge today, with agriculture making only 6.16 percent of bank lending in 2022.
