The Foundation for Partnership Initiatives in the Niger Delta (PIND), and Market Development in the Niger Delta (MADE), Programme have identified strategic policy initiatives in agriculture that will address the current economic challenges confronting Nigeria, create employment, and boost industrialization.
In a joint report launched in Abuja last week, the development partners showcased the impact of the devaluation of the Naira, and emphasised the need for government and international organisations to focus on agriculture and reshape interventions to reflect the prevailing economic realities, especially relating to aquaculture, poultry, palm oil, and cassava sub-sectors.
It noted that the devaluation of the Naira was occasioned by the drop in crude oil price from above $100 per barrel in early 2014, to below $30/bbl, and has influenced market dynamics for most farmers and agricultural market players, especially in the Niger Delta region where PIND and MADE are intervening.
“The devaluation has led to significant increases in costs of major inputs over the last two years which influence costs across all the value chains, forcing farmers and processors to look inward,” the report said.
In the Aquaculture value chain, for example, the report observed that, “Catfish prices have increased, as consumers turn to it as an alternative to more expensive imported fish and poultry, meaning that the farmers who have stayed in business have seen their revenues increase.”
Additionally, the currency devaluation has made foreign feed more expensive, creating an opportunity for local producers to meet demand.In the Cassava value chain, the report noted that the increase in the prices that market players in the Niger Delta received for their products was higher than the increase in input prices, meaning that Naira devaluation has been positive for most of the farmers.The report also explained that demand for cassava from the food sector increased, as the price of imported rice, a major substitute for cassava food products, more than doubled between 2015 and the beginning of 2017. As a result, rice imports dropped by about two million tonnes since the devaluation. Even with the increased industrial demand, the price for cassava on the food market is still higher than on the industrial market, leading producers and processors to allocate even more cassava to producing cassava derivatives for the food market.
Similarly, the report highlighted the impact of the ban on importation of some agricultural products. The ban on crude palm oil, for example, has allowed for an increased demand for both Technical Palm Oil (TPO), and Special Palm Oil (SPO).