Bangladesh food

The rice revolution as a panacea against food inflation

By enrolling 4,489,786 farmers, who in turn grew 5,300,411 hectares of rice and 20 other staples on the Anchor Borrowers program platform, CBN may have found a new approach to breaking food inflation. , reports ABDULWAHAB ISA

Food safety is an essential element for humans, ranking just after safety. No nation is truly secure if its people, at all times, do not have physical and economic access to sufficient, safe and nutritious food to meet their dietary needs and food preferences for an active and healthy life. Life and living are meaningless to man when food and the means to access it are beyond his means. Nigeria is a richly blessed and endowed nation. The country is skilled in all aspects of food production with agriculture as the main pillar of economic prosperity. Arable land is fertile for the cultivation of all food products.

Rice is one of the major commodities that Nigeria’s arable land can produce in sufficient abundance to meet the needs of the teeming population with leftovers being exported. Rice is a major staple in most homes. A 1991 World Bank report aptly indicates the importance of rice to Nigerians. The report notes that at least a third of Nigeria’s poorest urban households get 33% of their cereal-based calories from rice. Rice is the country’s staple meal for events and celebrations, ranging from weddings to funerals to holidays. A stable and popular food product, conversely, its supply must be cheap and easy to pay for. This is not the case with rice.

It is fast becoming a luxury food in most Nigerian homes. While Nigeria is blessed with arable land suitable for rice production, the country has fallen into an import chasm. A significant amount of rice for consumption was imported from Thailand, Japan and other Asian rice producing countries with less rice production capacity to Nigeria.

Paradigm shift

Nigeria was a major recipient of rice in millions of tonnes from 10 rice producers around the world. Rice was imported uncontrollably from China, India, Indonesia, Bangladesh, Vietnam, Thailand, Myanmar, Japan, the Philippines and Brazil. The import of rice has been supported by the country’s scarce foreign exchange. In addition to currency flight, employment opportunities have been unwittingly exported to rice-exporting countries.

The scenario lasted until 2014. The economic policy of President Muhammadu Buhari’s administration has agriculture as its cardinal objective, a policy overseen by the Central Bank of Nigeria. To reverse Rice’s bad luck and grant it its potential, the CBN Governor, Mr. Godwin Emefiele, in 2015 launched the Anchor Borrower Program (ABP). A well-thought-out program that would improve the fortunes of rice farmers and farmers in the country has been launched. The Anchor Borrower Program is an agricultural loan program designed to increase agricultural yields, stop large volumes of food imports and address the negative trade balance. .

The program has rice as one of the main food items to be supported. Seven years after ABP, the story of rice production is changing. There has been import substitution for locally grown rice. This is not to say that rice production in Nigeria has reached its peak. Not there yet with the still high price. CBN and experts are confident that the price will decrease over time. It was seven years of ABP last week. The occasion of the unveiling of the Federal Capital Territory (FCT) Mega Rice Pyramids provided an opportunity to evaluate the program and its impact. It had President Muhammadu Buhari as a special guest of honor where Emefiele gave a seven-year synopsis of the program.

“The Anchor Borrower Program has catalyzed the rural economy and established a sustainable framework for financing smallholder farmers in Nigeria. “The program has developed an ecosystem between all the nodes of the agricultural value chain and these links can be better optimized thanks to the synergy between all the stakeholders. By the end of December 2021, we had financed 4,489,786 farmers cultivating 5,300,411 hectares on 21 commodities through 23 participating financial institutions in all 36 Federation States and FCT.

“For example, Thailand alone exported 1.3 million metric tons of rice to Nigeria in 2014. PBA was launched in 2015 to reduce these imports, and since then we have seen gradual reductions in rice imports from Thailand. “In 2016, rice imports from Thailand were down to just 58,000 metric tons. By the end of 2021, they were only exporting 2,160 metric tons to Nigeria, saving us foreign exchange and keeping jobs in Nigeria. Beyond increasing our domestic production from approximately 5.4 million metric tons in 2015 to over 9 million metric tons in 2021, we have also significantly improved the productivity per hectare of smallholder farmers by approximately 2.4 metric tons per ha in 2015 to about five metric tons per ha in 2021.

“These expansions have not only made Nigeria the largest rice producer in Africa, but have also unlocked huge private sector investment in the rice value chain, with the number of integrated rice mills increasing astronomically from 6 in 2015 to over 50 in 2021 and many more. at various stages of completion. Today, Nigeria’s milled rice matches the quality of foreign rice.

“Drawing inspiration from our success in the rice value chain, last year we launched the ‘brown revolution’ as a mantra for the transformation of the wheat value chain in Nigeria. Wheat is the 3rd most important cereal consumed in Nigeria after maize and rice. It is estimated that we produce only about one percent (63,000 tons) of the five to six million tons of wheat consumed each year in Nigeria. This huge gap between supply and demand is met by more than $2 billion in annual wheat imports.

“As a result, wheat represents the second highest food import bill in Nigeria, putting pressure on the country’s foreign exchange reserves. We concluded the first major wet season wheat crop in Plateau State and planted more than 100,000 hectares of wheat in 15 states during the 2021 dry season. This strategic intervention will herald a gradual reduction in our utility bills. import of wheat over the next few years. “We have also established a strategic maize reserve with maize stock presented as loan repayment by our farmers.

This will provide a buffer for price modulation for poultry and feed mills nationwide. “A total of 241,656.76 MT was aggregated during the wet and dry seasons of 2020, of which 217,218.53 MT were distributed to 18 millers and poultry farmers through the Poultry Association of Nigeria,” said said Emefiele. The program was able to stabilize the poultry and livestock sectors during the pandemic and saved the industry and consumers over N10 billion in raw material costs,” Emefiele told a chairman. delighted Buhari and many state governors present.

Break the chain of food inflation

The prices of rice, and by extension other foodstuffs, are arguably still relatively high. Monthly inflation figures from the National Bureau of Statistics (NBS) pool confirmed the rise in food prices. Prices for all major food items have been high over the past eight months of monthly inflation. And people asked, why is the price of rice and other foods still high despite CBN interventions? One of the major challenges facing farmers is the escalating security challenge; incessant clashes between herders and farmers.

Farmers do not have a pathway to their farmland to harvest ripe produce, nor the ability to cultivate new land to cultivate it. This remains a sore spot freezing gains. The guarantee is the exclusive duty of the tax authority and not of the CBN.

The federal government has a dormant commodity exchange that is not being used. As the majority shareholder of National Commodity Exchange (NCX), the bank has unveiled a strategic roadmap to revamp the exchange. The exchange of goods is a key driver of economic growth. This ultimately leads to a reduction in food products. To break the chain of food inflation and give economic leverage to farmers, NCX is currently undergoing a major transformation. Emefiele lamented that the bank’s earlier efforts to contain the spiraling rise in food commodities through various financing interventions have been thwarted by commodity traders and profiteering middlemen in the agricultural value chain. These people, Emefiele said, were responsible for creating an artificial food shortage.

“We will not allow a selfish private commodity exchange to hold agricultural products and create price problems, because price stability is CBN’s curative mandate and we cannot shirk that responsibility. Fortunately, the CBN owns 60% of the Nigeria Commodity Exchange and we are taking control and running it the same way commodity exchanges are supposed to be run in any part of the world. This is a way of working to stabilize prices in Nigeria,” he said. To restore NCX, he planned a cash injection of 50 billion naira. The government halted its privatization and empowered the CBN to form a steering committee to bring the moribund exchanges to optimal functioning. A new Board of Directors led by CBN’s Deputy Governor is in place to oversee NCX’s affairs and direct management to drive day-to-day processes.

Food security is achievable

CBN’s concerted efforts in the agricultural value chain are sending encouraging positive signals. Rice production, one of the priority elements of the PBA, is being produced locally on a large scale. Rice imports have been drastically reduced. Commenting on the rice outlook last week, the National Chairman of the Rice Farmers Association of Nigeria (RIFAN), Alhaji Aminu Goronyo, was optimistic about Nigeria’s rice export in a few years to come. “The CBN has financed many farmers. In rice, which is my sector, CBN finance has created about three million jobs, especially for farmers and suppliers. Around five million jobs are created each year with this funding,” he said.

last line

The rice revolution launched by the CBN, if a sustained and similar push extends to other food products, will force food prices down to an acceptable level in no time.


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