CBN donates N100bn in fertilisers to boost Nigerian food production

In a significant move to enhance food production across Nigeria, the Central Bank of Nigeria (CBN) has provided N100 billion worth of fertilisers to the Federal Ministry of Agriculture and Food Security.

The handover, which took place on Wednesday at the FMAFS headquarters in Abuja, saw CBN Governor Olayemi Cardoso delivering 2.15 million bags of fertilisers to the Minister of Agriculture and Food Security, Abubakar Kyari.

Governor Cardoso, during the ceremony, emphasised the CBN’s commitment to maintaining price stability, highlighting the direct impact of food costs on the nation’s inflation rates.

With a large portion of Nigerian household spending dedicated to food and non-alcoholic beverages, the CBN recognises the urgent need to tackle food inflation as a key strategy in managing the overall inflationary trends in the country.

Despite various short-term measures to control inflation, Cardoso acknowledged that food prices continue to be the main driver of inflationary pressures.

However, he expressed optimism that the government’s efforts, including this substantial fertiliser provision, would significantly mitigate these pressures by the third quarter of 2024.

The strategic allocation of fertilisers is expected to not only address the immediate challenges of food inflation but also to ensure long-term food security for the Nigerian population.

He, however, pointed out that while transient inflationary pressures might persist, the government anticipates substantial alleviation by the third quarter of 2024.

“This is precisely why we convene today to strengthen our collaboration with the Ministry of Agriculture with a shared objective of mitigating the surge in food prices.

“In alignment with our strategic shift towards focusing on our fundamental mandate, the CBN has veered away from direct quasi-fiscal interventions, and transitioned towards leveraging conventional monetary policy tools for executing monetary policies.

“In this light, we aim to extend our support and foster closer ties with ministries, departments and agencies that bear the mandate and expertise to undertake these critical initiatives,” Cardoso stated.

He further noted that “consequently, we aim to enhance our partnership with the Ministry of Agriculture, thereby bolstering your endeavours to enhance food productivity and security, and ultimately, curbing food inflation and fortifying our pursuit of price stability.

“In pursuit of these goals, we are delighted to announce the allocation of 2.15 million bags of fertiliser valued at over N100bn, which we are humbly handing over to the Ministry of Agriculture.”

Before Cardoso took over as CBN governor in 2023, the apex bank intervened in the fertiliser market in Nigeria primarily by facilitating access to credit through programmes like the Agricultural Credit Guarantee Scheme and the Commercial Agricultural Credit Scheme.

The Central Bank of Nigeria (CBN) is actively promoting lending to farmers at lower interest rates through various programs.

Additionally, the CBN indirectly subsidises farmers by making credit more accessible, resulting in reduced fertilizer costs.

However, Kyari commended the CBN for its efforts in providing affordable fertilizers, acknowledging that the cost of fertilizers is a significant factor in agricultural production.