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Boosting Agric Exports for Increased Revenue Generation
There is no better time than now for economic managers to have a renewed focus on prioritising investment and policy decisions into the nation’s agricultural sector especially at a time when the country’s capacity to earn foreign exchange is dwindling. Gilbert Ekugbe writes
There is no gain saying that Nigeria’s dependency on hydrocarbon resources has brought the country to its knees and evidently so, the nation’s debt profile has continued on an upward swing putting its citizens and unborn generation in a tight fix.
Despite the limitless opportunities of Nigeria’s abundant natural endowments, the agricultural sector is still far from changing the economic narratives of Nigeria. Only recently, the African Development Bank (AfDB) stated that with the removal of barriers to agricultural development aided by new investments, Africa’s agricultural output could increase from $280 billion per year to $1 trillion by 2030 this goes to show that the sector’s potential to transform the nation’s economic fortunes is still far from its best.
According to the President, AfDB, Akinwumi Adesina, this is the time to invest in Africa’s future, pointing out that the continent has more than 60 per cent of the world’s remaining arable land, and millions of Africans are productive in the agriculture sector.
Regrettably, the continent is home to a third of the world’s 850 million people living with hunger a market begging for an agrarian economy to latch on. Many developed economies of the world have rapidly upgraded their economic status prioritising agriculture as the mainstay of their respective economies, a path Nigeria must thread to diversify its economic revenue base as well as ensuring food security for its increasing population and the unborn generation.
State of Agric export
According to the National Bureau of Statistics (NBS), Nigeria exported agricultural goods worth over N84.21 billion in the third quarter of 2022 representing a 40.6 per cent decline as against N141.77 billion generated in Q2 2022, but marks a 6 per cent increase compared to N79.41 billion recorded in the corresponding period of 2021.
Meanwhile, top of the list of Nigeria’s agriculture export to the globe in 2022 include cocoa beans, sesame seeds, and cashew nuts generating an aggregate sum of N262.99 billion. Mid year in 2022, Nigeria exported cocoa worth N114.1 billion representing a 0.8 per cent of the total exports recorded by Nigeria.
For Sesame seeds export, Nigeria earned N81.5 billion during the first half of 2022 representing a 0.6 per cent of Nigeria’s export in the first half of the year.
Nigeria realized over N67.39 billion from cashew export in the first half of 2022 representing a 0.5 per cent of the total export recorded by the largest market on the continent.
Also in 2022, Nigeria imported agricultural goods worth N512.91 billion in the third quarter of 2022, marking a 10.4 per cent increase compared to N464.4 billion recorded in the previous quarter and a 6.4 per cent increase compared to N482.2 billion in the corresponding period of 2021.
Agric export challenges
Nigeria’s agro produce are still facing high level of rejection at the global scene particularly cocoa beans. According to the European Union (EU) cocoa producers do not meet the maximum residue limits set by the EU for agriculture products especially cocoa. Reasons for the rejection is not far fetched due to substandard measures deployed in preserving these agro commodities. Due to poor handling of agricultural products (post and pre-harvest seasons) diseases and pests attack as well as excessive use of pesticides for preservation purposes are also some of the major issues hindering agric export.
The urgent need for the federal government to sensitise Nigerian farmers on the need to adhere to Good Agricultural Practices (GAP) is not out of place as this would help in facilitating a seamless agric export market while also generate foreign exchange for the nation.
Beside rejection, Nigeria’s capacity to export agro produce is also being hindered by the inability to produce enough to meet its food needs before considering export. Experts in the non-oil sector have blamed the problems encountered by operators in the sector ranging from inadequate and decaying infrastructures, financing constraints, inefficient implementation of export incentives and support programmes, over regulation of the non-oil export sector, underdeveloped regional and sub-regional markets, policy instability, capital flight marketing and pricing problems. They argued that the small-scale farmer has poor market arrangement for his farm produce due to largely poor infrastructure, poor communication network and low access to logistic and inputs support. These surmountable challenges continue to question the federal government’s seriousness about diversifying its economic revenue base away from hydrocarbon resources.
Agro export prospects
The NBS in its report stated that total agric exports between January and September 2022 stood at N427.6 billion, while a sum of N504.9 billion was earned for the full year of 2021.
Interestingly, Nigeria can take advantage of countries in Middle East who depend solely on food imports to meet their food needs. The Asia region is the leading importer of Nigeria’s agricultural commodities. The region’s agric import from Nigeria was valued at N43.4 billion and while Europe was valued at N9.4 billion.
Unsurprisingly, Nigeria failed to take advantage of the opportunity that the Russian-Ukraine offered where most of the world economies who depended on Russia and Ukraine for diesel and petroleum products, Nigeria could have been the food plug for countries who depended on Russia and Ukraine for wheat. It has been proven that Nigeria has the potential for the production of wheat and fortunately, it can grow wheat under the irrigated and rainfed conditions. Irrigated wheat is grown in the northern parts of the country, where the night temperatures range between 15-20 degrees Celsius. Some states have been identified that possess such conditions – Borno, Yobe, Bauchi, Jigawa, Gombe, Kano, Katsina, Kebbi Zamfara and Sokoto. According to the former Executive Director, Lake Chad Research Institute, Oluwasina Olabanji, said during the accelerated wheat programme in 1987, the Federal Government banned the importation of the grain to encourage local production, saying that within three years, Nigeria’s production rose from 50,000MT to 450,000MT as many farmers went into the production. One could only imagine how much progress Nigeria could have achieved had the ban on the importation of grain was sustained.
According to AfDB, African countries need policies to unlock the huge potential of agro commodities by developing agricultural value chains and agro-allied industries that process and add value, noting that this will allow them to become more competitive in global value chains, raise incomes for their farmers, instead of being stuck at the bottom of global value chains.
“There is absolutely no reason for Africa to be food insecure. Africa must become a breadbasket for the world. Unlocking this enormous potential of Africa’s agriculture must be at the top of global food security agenda,” AfDB affirmed.
The way forward
According to the Organisation for Economic Cooperation and Development (OECD), government policies have an important role in providing an enabling environment that could promote agricultural productivity growth and enhance the competitiveness of agro-food exports through appropriate investments in key areas such as transport infrastructure, education and research and development.
The federal government must encourage Small Holder Farmers (SHFs) by way of incentives, provision of farm inputs such as fertilizers, seedlings, tractors and equipment to boost farmers’ productivity. It has been reechoed by stakeholders in the industry that Nigeria must develop the capacity of its farmers to attain food security. The economic managers must also urgently prioritise investment in agricultural technologies in order to be able to phase out the ageing farming population. Most youths have neglected agriculture due to the hard labour that comes with.
There is also the urgent need to fund the many agricultural research institutions spread across the country. These institutions provide transfer of research-induced technology to farmers, which is the only way to measure research benefits to society.
Agricultural research impact study also provides feedback to scientists on which technologies or technology components are successful at farm levels. They are also vital for encouraging and implementing technologies to increase the nutrient density of commercial and staple crops through agronomic practices, conventional plant breeding, or modern biotechnology. Invest in research to better understand the potential contribution and current constraints of urban and rural agriculture.