‘Reports from producing states indicate that about 3,500 rice farmers are contemplating exiting rice cultivation after incurring estimated losses of over ₦93 billion. Many had invested heavily in land preparation, irrigation, seed, fertilizer, and labour, only to face a market flooded with cheaper alternatives.’
Siaka MOMOH
Worried by Nigeria’s food strategy system that is navigating an exceptionally difficult season, stakeholders in the vegetable oil sector came together on Wednesday in Lagos, to brainstorm on how to tackle this national challenge.
The concerned stakeholders gathered to have a constructive and forward-looking conversation on Nigeria’s current food strategy, particularly the recent market adjustments around food importation, the observed decline in food prices, and what these developments portend for local farmers, investors and “our collective quest for s,ustainable food security”.
According to Dr Fatai Afolabi CEO Foremost Development Services Limited (sustainability consultants), the convener, who delivered the keynote address, “This discussion is not intended to criticise government policy. Rather, it is meant to strengthen it by ensuring that efforts to make food affordable for consumers do not inadvertently weaken and impoverish the very farmers whose labour sustains our food system”.
Government’s Intention
Fatai Afolabi argued: “Inflationary pressures, climate variability, insecurity in major food producing regions, and rising costs of energy and logistics have all combined to strain both producers and consumers. Against this backdrop, the Federal Government’s decision to temporarily relax restrictions on selected food imports is understandable. The primary objective has been to stabilize markets, increase food availability, and ease the burden on households struggling with high food prices. Following this policy adjustment, the market has responded swiftly.
“Prices of major staples such as rice, maize, cassava products, tomatoes, and vegetable oils have declined. For millions of Nigerian consumers, this has brought much-needed relief.”
Troubling Reality
He said however, beneath this welcome price moderation lies a more troubling reality for local farmers and agriculture value chain investors, one that calls for urgent and careful attention.
Dr Afolabi argued: “While output prices have fallen, the cost of producing food in Nigeria remains stubbornly high. Farmers continue to contend with expensive fertilizers, high fuel prices, rising transportation costs, costly improved seeds and agrochemicals, limited access to affordable credit, poor and epileptic electricity supply, poor road infrastructure, and weak storage and processing infrastructure that leads to significant post-harvest losses. This scenario, where farmers sell produce at declining prices while production costs remain elevated, has created widespread distress across agricultural ecosystems.
He said the effects are being felt across all segments of agriculture adding that in the arable crop sector, rice farmers are among the hardest hit.
3500 Farmers Exiting
Said he: “Reports from producing states indicate that about 3,500 rice farmers are contemplating exiting rice cultivation after incurring estimated losses of over ₦93 billion. Many had invested heavily in land preparation, irrigation, seed, fertilizer, and labour, only to face a market flooded with cheaper alternatives. The result has been depressed produce prices that fall below the cost of production. Cassava farmers are facing a similar crisis. Cassava, long regarded as a resilient and dependable staple, is currently experiencing a market collapse in several producing zones. Tubers are selling at prices that barely cover harvesting costs, leaving farmers helpless and unable to recover their investments.
Farmers Battling Price Volatility
Same argument goes for cocoa. He said “Cocoa farmers continue to battle price volatility in international markets while shouldering rising domestic costs of labor and farm maintenance. Because tree crops like oil palm and cocoa are crops of long gestation periods, they thus require long-term investment and patience. Sudden market disruptions are especially damaging, undermining investor confidence and discouraging new investment.”
Soyabean Farmers in Trouble
Dr.Afolabi also argued that downstream, the effects extend to agro-processing and value addition. Said he: “Soybean farmers supplying processors for vegetable oil production are experiencing reduced demand and lower prices. Small- and medium-scale processors are squeezed between cheaper imports and the high cost of energy, packaging, and logistics. This threatens not only farm incomes but also rural employment and agro-industrial development. These developments raise a critical question about food security. Food security, he said, is not solely about ensuring that food is available and affordable today. It is also about safeguarding the capacity of local producers to continue producing tomorrow.” If sustained losses force farmers out of production, Nigeria risks increasing its dependence on imports, exposing itself to global supply shocks, foreign exchange pressures, and long-term vulnerability in its food system.”
Lessons From Other Climes
He argued: “Other countries offer valuable lessons on how to balance consumer protection with farmer sustainability. He cited India and Netherlands. He said in India, food imports are sometimes used strategically during shortages, but they are carefully timed and complemented by strong domestic support systems. Farmers benefit from minimum support prices, government procurement programs, and substantial investments in irrigation, storage, and extension services. Imports act as a temporary buffer, not a permanent substitute for local production.
“The Netherlands, despite being one of the world’s leading agricultural exporters, Dutch farmers receive extensive support through input subsidies, tax incentives, affordable energy, strong cooperatives, and close integration with agricultural research and extension services.”
.These measures ensure that farmers remain competitive even in highly liberalized markets, Dr as policy said.
Cheap Imports
The Chairman of the Plantation Owners Forum of Nigeria, Mr Emmanuel Ibru, in his own remark at the conference said the Nigerian market at the end of last year was flooded with cheap imports leading to crashed local prices and threatened local investments. According to Mr Ibru, the situation has had severe ripple effects on vegetable oil manufacturers and palm oil producers.
The POFON chief recalled that earlier policy interventions, particularly during ex-President Olusegun Obasanjo regime helped to stabilize the sector through introduction of duties on palm oil imports and ban on refined vegetable oil imports. He said billions of naira that were invested by indigenous investors, across plantations, processing and logistics following the introduction of these policy, are now under threat due to cheap imports.
In summation, Dr. Fatai Afolabi said “Our collective responsibility is to ensure that the market interventions relieve consumers without eroding farmers confidence, that short-term relief does not compromise long term resilience, and that Nigeria’s path to food security remains firmly rooted in a vibrant and sustainable domestic agricultural sector.”
Call For Stronger Regulations
The President, Soyabean Association of Nigeria, Dr Christopher Uwala, called for stronger regulation and institutional support for the sector to safeguard domestic production.
Uwala expressed concern over the increasing inflow of imported soyabean seeds and products which he said required closer scrutiny by regulatory authorities. He argued that some imported genetically modified soyabean products could pose health hazards if not properly assessed. He argued that from available literature and some documented reports, concerns have been raised that some imported soyabean products may be carcinogenic and could be contributing to health challenges, including infertility.
Smuggling/Policy Reversals
Chairman of the Vegetable and Edible Oil Producers Association of Nigeria, Chief Okey Ikoro, warned that policy somersaults destabilize an industry with long gestation periods and high capital requirements. He said the issue of smuggling further complicates matters as unbranded vegetable oil in yellow jerry cans had become a menace across the country. He warned that aside from economic damage, the influx poses quality and public health risks.
Chairman of the Vegetable Oil Sector of the Manufacturing Association of Nigeria (MAN), Mr Mohammed Tahir, spoke against policy reversals and poor enforcements. For him, Nigeria should take a cue from Chin/a, India, Indonesia and Brazil which aggressively protect domestic agricultural industries while building competitive advantage.
And the President of the National Palm Produce Association of Nigeria, Ambassador Alphonsus Inyang said recent government intervention across agricultural commodities had largely impoverished primary producers, with oil palm farmers among the hardest hit.
He said that palm oil prices had fallen by about 50 per cent in less than two months even as the country approached the peak production season.
