Empty silos? Nigeria’s total grains reserve will be consumed in two weeks, experts says

Prices of foodstuffs in Nigerian markets have hit the roof and even as government promises to open up the grain reserve, what is available amounts to a drop in the ocean. COLLINS NNABUIFE, in this report writes that experts say government’s intention may fail even as the solution is nowhere round the corner.

MOST Nigerians now complain of the hike in the price of rice because it is a staple food of the majority, but that is not to say that the prices of other foodstuffs have remained stable. From beans to garri, cooking oil and even bread, prices of foodstuffs have increased astronomically, to the extent that the cost of feeding in the budget of the average Nigerian family has dug a hole in their pockets.

This reality is not lost on the Federal Government. Recently the Minister of Agriculture, Dr Audu Ogbeh, blamed the hike on security agencies (the police, army, Customs, including local government officials who extort money from motorists carrying foodstuffs from one part of the country to another). Ogbeh, who said he had written to the Inspector-General of Police (IG), Ibrahim Idris, and heads of other security agencies over this, added that the price of diesel is another contributory factor. This, he said, also often forces farmers to increase the prices of foodstuffs.

The agriculture minister, who said this during an appearance before the Senate and House of Representatives Joint Committee on Agriculture and Rural Development for 2017 budget defence last month, revealed that the federal government was considering opening up the grains reserves to force down the price of foodstuffs.

“We shall be looking into our reserves, if in the next few days the situation persists, to see what we can bring out to lower the prices because another bumper harvest will be coming up at the end of March,” he said.

The minister, however, added that this would only happen if the situation did not change. It has not.

However, experts say Nigeria’s grains reserves are located in 23 locations across the country, with a capacity of 1 million metric tons. As of today, there are only 8,000 metric tons in the reserves with a value of N1.5billion, which, if totally released, would be consumed by Nigerians in two weeks. Experts say government would need about N1 trillion to fully stock the grain reserve.

One reason adduced to the low volume in the reserves is attributed to distribution of about 38,000 tonnes of grains to Internally Displaced Persons in the North-East due to Boko Haram insurgency, and to the Poultry Farmers Association of Nigeria. Unfortunately, the reserves have not been replenished due to inadequate budgetary provision.

But farmers, say there is hope that prices of foodstuffs may reduce by the time the harvest from dry season farming comes into the markets at the end of this month, noting that there was no need for the government to release grains from the strategic reserves because it may discourage production.

Coincidentally, according to the National Chairman of the National Association of Grains Storage Practitioners of Nigeria, Chief Eric Ozongwu, since the minister made the announcement, prices of grains have reduced by between 8 and 10 per cent.

“But they have also gradually started coming up again. The fact is that the demand for grains is very high because of the problem we had in the last two years and we have not produced much. So, the supply is not enough. And also, we are exporting a lot of it illegally,” he said.

Some farmers, however, argued that releasing the grains to the market will affect them adversely, as most of them have spent a lot of money on its farming and they need to sell their products to recoup their capital and also make some profits.

The National President of Grassroots Farmers Development Initiative of Nigeria (GFDIN), Anthony Eze, said that before government could release grains into the market, it should carry out a research to know if farmers had actually sold their grains, so that the grains do not crash the prices of the farmers products.

“Before government releases any grain from our reserve, government should first of all find out whether the farmers will not be affected because anything the government pushes into the market will crash the prices of the farmers’ products, and once the farmers’ prices crash, it will result in a monumental loss for farmers. That’s why we are appealing to the government to find out that farmers have been able to sell off what they have, except farmers do not have products in the market, especially the large producers of grains,” Eze stated.

However, Ozongwu maintained that prices of agricultural products have gone too high and if the prices come down a little bit, it will not affect farmers. “The price might come down a little bit when the grain is released, but after a while, it will increase again,” he said.

On the possibility of other neighbouring countries buying off the grains from the market, Eze urged “the government to get the data base of producers and buyers of the grains, and also get a comprehensive value chain of the things being produced in Nigeria. “How many are coming to buy? how many tons are they buying? how many tons are the farmers producing? and how many tons is the government trying to push into the market?

“If the people come in, if the money they are bringing into Nigeria is to purchase about 10 tons, and the farmers have about 5 tons, but the government is pushing 50 tons into the market, and if the people are supposed to pay $10 per ton for instance, they will now price $1 per ton, and you will be forced to sell because you have no choice.

“That is why collection of data is very important. Government should tell us how many persons are still having grains in large quantities that can be pushed into the market; and what is the quantity they are trying to push into the market so that they will not crash the prices of these products, which will affect the farmers adversely.”

“We support the government’s move to release grains from the reserves because we are not comfortable with the high prices of grains in the market,” Ozongwu said.

Meanwhile, the Country Coordinator of Open Forum for Agriculture Biotechnology (OFAB), Mrs Rose Gidado, said it was time for the government to embrace other biotechnology and Genetically Modified Organisms (GMOs) to boost food production, instead of waiting for government to release grains from its reserves whenever prices go up, though she supports the move.

“This is the time to have a rethink on Genetically Modified Organisms (GMOs) and other biotechnology that can contribute to food security, not just using one technology. We should learn to diversify and use as many types of technology as we can until we can feed our population. No nation is developed if it can’t feed itself.

“Food security is very vital, so any technology that can lead to food security, I will advise the government to venture into it until there is enough food to feed the populace.

“It is a welcome development because there is so much hardship and so that people will be able to feed their families. A bag of maize is going for about N12,000 now and many people cannot afford it,” she said.

Also, the National Secretary of Sorghum Millers Association of Nigeria. Adamu Bature, said the move by the government to release grains from the strategic reserve will discourage farmers from going to the farms.

He said it is unwise for government to take actions that will crash the prices of grains in the market when farmers had spent huge amount of money purchasing fertiliser. He fingered the big companies that buy grains in large quantities as those behind the plans by the government, stressing that the companies prefer to buy grains cheaply in order to make good profits.

According to Bature, “the issue of releasing grains from the reserve now is political. The government releases grains when the situation is hard, when grains are a little bit out of circulation. When the farmers have finished selling their own. I think it is just political and it is very discouraging for farmers.

“It is the companies that are finding it difficult to buy grains because they are used to buying at cheap rate, but now, they want government to release the grains so that they will buy it and keep it in their factories. Unless that, I don’t see any reason for the government to release grains at this time.

“The grains will fall into big hands, big companies that have the money. They will manipulate, and take them to their own companies for their own production which will affect the market seriously because these companies are used to buying grains very cheap at about N5,000 per bag and now it is over N10,000 per bag. They are used to making cheap profits.

“Last year, we bought fertiliser for almost N10,000, so how will you buy fertiliser for such amount and the government will take actions that will slash the price of products? It is not encouraging.

“This is the time for government to buy up grains, instead of releasing grains. If the government wants to release grains, it has to be at a later date in May or June because at that time, the farmers will be busy in their farms and most of their products must have finished.”