Insecurity: Will Farmers Return to The Farms

Following the unending herdsmen/farmers clashes, Gilbert Ekugbe takes a cursory look at what the federal government and stakeholders in the agricultural value chain must do to encourage farmers to get back to the farms.

It is no longer news that herder-farmer conflicts have continued to disrupt farming activities across different parts of the country, especially in the North East. These disruptions have also affected farmers’ productivity levels as well as make substantial incomes to improve their standard of living.

With the agricultural sector growing by 14.03 per cent year-on-year (YoY) in nominal terms in Q4 2020, showing a rise of 0.23 per cent points from the same quarter of 2019 representing an increase of 0.51 per cent based on the preceding quarter’s growth rate of 13.52 per cent, there is still so much work to be done for the sector to contribute significantly to the nation’s Gross Domestic Product (GDP).

Nigeria remained the largest producer of staple crops in the Economic Community of West African States (ECOWAS) region. There is an urgent need by economic managers by way of policy formulation that take into cognisance of agricultural stakeholders’ input to maintains its leadership position in that regard.

The future of the agricultural sector of the nation’s economy is faced with several uncertainties such as resource scarcity, heightened risks from climate change, higher energy prices, demand for bio-fuels and most importantly inadequate funding. Funding agriculture in Nigeria entails provision of funds for short term and long-term agricultural production. It begins with provision of funds for research on agricultural production to the funding of the packaging, communication and adoption of the findings of such research until consumption. Provision of the required funding is a major factor for achieving any measure of success in agricultural production in Nigeria.

Agricultural Funding

Essentially, agriculture in Nigeria has been funded with private savings, governmental allocations, agricultural credit schemes and foreign investment. Few farmers can save enough from their meager earnings to take full advantage of the ever-increasing range of improved agricultural technologies or to fund development of new ones. As a result, many farmers are caught in the vicious cycle of poverty.

Many farmers in Nigeria are poor because they produce very little output and hence sell very small amounts, which in turn cannot help them to expand their farms and increase production; this is as a result of their in accessibility of adequate funds.

Key is lack of access to finance and the resultant inability to invest in basic farming inputs such as seedlings, fertilizers, implements and irrigation. As a result, their yields have remained largely stagnant, leading to pervasive hunger and poverty. Similarly, little or no commercial funding is available to those aspiring to build businesses that could enhance food production and enable farmers to earn sustainable profits. Therefore, they need credit, aids, grants or subsidies to supplement personal sources.

Essentially, agricultural funding aims at facilitating the flow of funds to farmers to enable them to adopt new technologies and farm practices designed to raise productivity and incomes. In other words, it aims at ensuring that adequate funds are provided to the agricultural sector, on reasonable terms from the mainstream of the financial system. This is important since left on its own, the financial system continued to discriminate against agriculture as a risky and unprofitable enterprise. Efforts of the government to ensure that substantial financial resources get to the farms include the Nigerian Agricultural and Co-operative bank at the national level, the Agricultural credit cooperation at the state levels and the concessional interest rates on agricultural loans.

Furthermore the government established the Agricultural Credit Guaranty Scheme Fund in 1978 to substantially reduce the risks involved in lending to agriculture.

Agricultural funding creates access to capital for the purpose of farming which payment is to be made at an agreed future time. Essentially, agricultural funding aims at facilitating the flow of credit to farmers to enable them to adopt new technologies and farm practices designed to raise their productivity and incomes.

Its target is to ensure that adequate funds are provided to the agricultural sector on reasonable terms from the mainstream of the financial system. Left on their own, the financial institutions prefer lending to large-scale investment outside the agricultural sector because of their huge profits, prompt returns, shorter gestation periods of enterprise, and quick turnover.

Private foreign investment in agriculture has been relatively insignificant in Nigeria. Foreign companies and nationals have made little direct investments in agricultural production and research. However, since the late 1970s, there has been an appreciable inflow of loans, grants and technical assistance from foreign governments and international financial institutions such as the World Bank Group.
Nigeria’s numerous smallholders on the aggregate make substantial investments in addition to relying on informal funding, this has proved inadequate. The basic agricultural funding problems remain poverty amongst peasant smallholders, because of their inability to access credit.

Federal Government Role

Farmers have continued to groan under the incessant attacks by herdsmen as they are calling for an extension for repayment under the Anchor Borrowers’ Programme (ABP), which was launched by President Muhammadu Buhari on November 17, 2015, to create a linkage between anchor companies involved in the processing and smallholder farmers.

However, this scheme is already being threatened since they have all abandoned their farms as a result of disruptions from herdsmen attacks. Therefore, the urgent need to restrategise Nigeria’s security architecture could not be overemphasised.

Farmers must be assured of their safety when they carry out their activities on their farms even at a time when food prices have continued to surge with Nigeria facing an acute food insecurity challenge in the next three months as predicted by the World Food Programme (WFP).

The federal government and state governments must urgently devise means to improve the security situation across boards to encourage farmers and boost their productivity for Nigeria to achieve food security by 2030.

There is also the need to develop the nation’s research institute to prepare farmers for the looming days of climate change that has caught with many countries experiencing wildfires and devastating floods with Nigeria are not left out.

Research institutes must develop improved seedlings, soil textures and new seed variants to help farmers do much more with little effort as this would also attract new investments from both local and foreign investors into the sector.

The aging farming population is another source issue to be worried about as these set of farmers are grossly inadequate to supply the nation’s food needs with cutlasses and hoes.

The federal government must also prioritise strategies by strengthening partnerships with international food agencies such as Food and Agriculture Organisation (FAO), International Institute of Tropical Agriculture (IITA), International Fund for Agriculture Development (IFAD) and the likes to develop the sustainable, climate-resilient economic and financial inclusion of young people in profitable agribusiness and strengthen institutions at state and community levels to work with private companies in key-value chains, build rural institutions, establish community-driven development initiatives, develop profitable smallholder agribusiness and pursue financial inclusion for rural poor households.
Stakeholders’ Input

Stakeholders in the agricultural value chain must as a matter of urgency start to educate farmers across the country with Good Agricultural Practices (GAP) in order to address issues of rejection and food safety. Farmers have to be aware of the need to be more careful handling food products. Developed countries across the globe place premium importance on food safety.

An agribusiness expert and Director General, Premier Agribusiness Academy, Mr. Toromade Francis, called on the need for stakeholders in the agricultural sector to train farmers on GAP, saying that until Nigeria develops human capital on the most impactful agricultural practice, the federal government’s target to achieve food security would remain a wild goose chase.

On his part, the Memorandum of Understanding (MoU) he signed with the International Institute for Tropical Agriculture (IITA) has continued to record remarkable successes, noting that the MoU would see farmers trained on production of yams, maize, cassava, rice, soyabeans and cowpeas.
In July this year, the Director-General, FAO, QU Dongyu, at the pre-Summit of the UN food systems summit, reiterated his call for more investment in rural areas and actions to end hunger and poverty.
“We must refocus our energies and investment on rural areas. Investing in the agriculture sector is the solution to eradicate hunger. Unless we assume responsibility and take urgent actions, we might gather in 2030 to announce that not only did we not eradicate hunger and poverty but that 660 million people are still hungry,” he added.

The Chief Executive Officer, Farmcrowdy, Mr. Onyeka Akumah, stated the need to reshape the way people participate in farming and food production by using their online and mobile platforms as it launched six business divisions covering technology; insurance; aggregation; marketing; foods and structured finance.
He stated that the move was to grow the number of farmers as it plans to work with over 500,000 farmers in 2021

Recommendation

Regrettably, the agricultural sector of the country accounts for only 1.7 per cent of the total lending by banks even though the sector account for over 42 percent of the country’s GDP. It is now dear that the commercial banking system does not have the capacity, skills and resources to single-handly attain exponential growth of the agriculture sector.

The challenges of financing smallholder farmers, is more than just the provision of finance, it is also about providing a complete solution to smallholder farmers to ensure long-term sustainability, food security, and higher standard of living. By transforming the sector via funding, Nigeria can produce more food to feed itself, lower the cost of food imports, and even become the major food exporter and a breadbasket for the whole of West Africa.

Conclusively, if Nigerian agriculture must step up to its true potential, then a proper funding mechanism by way of forming a coalition between the federal government, central bank of Nigeria and Nigeria money deposit banks must be put in place to truly change the financing landscape and reposition Nigeria’s agriculture for increased food security, job creation, raw material supply, poverty reduction and industrialisation according to a research article by the Arabian Journal of Business and Management Review.

Proffering solutions to the menace, the National President, All Farmers Association of Nigeria (AFAN), Mr. Kabir Ibrahim, said there is a nexus between insecurity and food security, saying that once there is no security for farmers to produce optimally, there is no way the farmers would produce to satisfy the needs of over 200 million Nigerians.

He also stated that the agricultural sector is also beset with lack of adequate transportation, power, good and veritable seeds and mechanization, calling on the federal government to prioritise investment in the agriculture value chain.

“If the federal government wants the farmers back to the farm, they must bring adequate security about. There are no two ways to go about it,” he said.

On his part, the National President, Agriculture Produce Sellers Association of Nigeria (APSAN), Aloys Akortsaha, urged the federal government to address the issue of insecurity, saying that the high level of insecurity is one of the major challenges hindering farming activities in the country.

“The federal government should not only just look into the matter, but with all seriousness because the issue is currently being handled with levity and it is not the best. If the farmers are guaranteed safety from security agencies, they will return to their farms because they are also affected by this situation,” he said.
He also advised the government to address the issue of multiplicity of taxes, pointing out that farmers are discouraged by the activities of tax regulators in different states.

“This is why you go to some farms and you see some commodities getting rotten because the farmers are tired of paying tax on these commodities. They calculate what it will take them to get these commodities to the market and what they would be taxed and in most cases, they do not have much to live by after paying these taxes. So multiplicity of taxes should be discouraged,” he added.