Report Highlights Further Risks to Food, Commodity Prices in 2023, 2024

Report Highlights Further Risks to Food, Commodity Prices in 2023, 2024

Laments low bank lending to agriculture, inadequate inputs to farmers, seeks greater investments to transform food system

James Emejo in Abuja

A new crop production report has predicted an increase in prices of all major agricultural commodities predicated on a general decline in production and increasing demand across processing and export value chains.

The APEX Wet Season Crop Production Report 2023 which was launched yesterday, also expressed concern that input lending remained a major challenge in the country as banking sector credit to agriculture stood at barely 6.16 per cent in 2022.

The report further identified food insecurity and food inflation as major challenges confronting the country with a 5.7 million metric ton – deficit across human consumption and agro-processing, as well as a historic high food inflation rate of 30.64 per cent.

Specifically, it noted that paddy rice faced the most notable upswing in 2022/2023, partly due to increased flooding and India’s rice export ban which contributed to an increase of 34 per cent to baseline pricing of N353,000/mt.

The report said this was expected to rise to N400,000/mt and projected to stabilise at between N480,000 and N500,000/mt by Q3 2023.
It pointed out that Nigeria’s Global Hunger Index score remained alarmingly high at 109th out of 125 countries, indicating a severe food security crisis in the country.

The report noted that food prices continued to surge as witnessed in the 2023 season adding that food security challenges would continue to persist, further reducing the Africa’s capacity to achieve zero hunger by 2030.

Speaking at the unveiling of the report in Abuja, President/Chief Executive, AFEX Nigeria, Mr. Akinyinka Akintunde, 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 prioritise 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.”

Essentially, the study delivers insights into six key commodities including maize, paddy rice, soybean, sorghum, cocoa, and sesame, and leverages farmer surveys and measurement of transaction-level data to track vital information across crop production, price performance, and market dynamics.

Akintunde said the report would aid the understanding of the current food system, which needed urgent transformation while providing stakeholders in the commodities market with intelligence to make data-driven trading decisions in the coming season.

Nonetheless, the survey affirmed critical improvement in access to farmland for cultivation in crucial areas, as well as an increase in the usage of improved inputs, such as high-yielding seeds and fertilizers, compared to the preceding season, which contributed to maize and paddy rice being forecasted to have a significantly higher production in the current season.

It stressed that the shortage of reliable data continued to impact the availability of transparent pricing and limits, and constituted a recurring limitation for agriculture on the continent.

The report, among other things, stated that maize and paddy rice were forecasted to have a significantly higher production this season due to expansion in cultivated land and increased fertilizer usage, compared to last season.

Soybean and Sorghum were also expected to decrease modestly due to challenges around seed and land usage while cocoa also faces a decrease in volume due to aging trees and reduced pesticide with sesame growing due to favourable weather and increased international demand.

It added that global trade commodity exchanges, including AFEX, play pivotal roles in promoting fair pricing, managing risk, broadening market access, driving investment, and establishing and enforcing quality standards for agricultural products.

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