Gradually, but noticeably, food prices are beginning to drop, bringing a sigh of relief to many households. What exactly is driving down food inflation in the country? In this report by BENJAMIN SAMSON, some think it is due to the wet season harvests, but economic experts argue that it’s a positive reflection of the economic reform policies of the present administration, among others.
Recently, Blueprint Weekend undertook a market survey in Abuja and other major cities in the country to monitor the trends in food inflation. Its findings revealed that there is a steady decline in the cost of staple food items such as rice, beans, millet, etc, over the past few months.
The positive price behaviour has significantly improved preferences and consumption patterns of households in the country. The average price of a 50kg bag of foreign parboiled rice now sells for N85, 000, depending on the brand and size of the grain as against N110, 000 sold last year. A 50kg of local parboiled rice now sells for an average of N70, 000, compared to N105, 000 sold this time last year.
In remote areas, Blueprint Weekend further gathered that the price further dropped to N58, 000 in some parts of Nigeria, particularly in rural areas and around border communities.
Also, the average price of a 100kg bag of beans sells for N120, 000 as against N300, 000 sold last year, while a small paint bucket of beans now sells for an average of N8, 000 as against N14, 500 last year, indicating a 45 per cent drop in prices.
Likewise, a 100kg bag of white corn costs between N40, 000 and 50,000; this is a big drop from N100, 000 at this time last year at Kawu Market, Kaduna state. Prices can vary depending on location and whether it’s new or old stock. For example, a recent report from the Saminaka Grain Market in Kaduna also indicates a drop in price to N50, 000 – N55, 000 for new maize.
Many people have been wondering what might have been responsible for the sharp drop of prices of food items in the markets.
Reforms/intervention
Speaking with this reporter, the chairman of Masaka market in Karu local government area of Nasarawa state, Alhaji Salihu Maikudi, said prices of essential commodities like rice, flour, milk and beans have crashed significantly following a shift in the federal government’s policy leading to a critical intervention.
He said further that the government window gave importers an opportunity to bring in some essential commodities like rice, cooking oil, and spaghetti, forcing the prices of commodities to reduce.
He said, “There is no gainsaying that the credit truly must go to the federal government and indeed our marketers who adhered to the government policy of importing the stipulated commodities, making them available, and resulting in the over 40 percent reduction of their prices.
“The removal of duties on about 43 items and the subsequent supplies of rice that were sold at N40, 000 helped the marketers flood the markets.”
He said apart from rice which was sold at about N120, 000 and has now crashed to less than N80, 000; a carton of spaghetti which was sold at N20, 000 is now selling at N14, 000.
“Even flour that was sold at N90, 000 is now selling in the markets at about N70, 000, while 50kg oil that was sold at almost N100, 000 is now selling at N70, 000,” he added.
Likewise, a public affairs analyst, Dr. Taiwo Michael, said the timely intervention by President Bola Tinubu through tariff waivers on key food imports has led to a significant drop in food prices across the country.
“At the time, rice was over N100, 000 per 50kg bag, flour was around N80, 000, and maize N60, 000. But with the president’s foresight and duty waivers, we were able to import large volumes, process them quickly, and crash prices,” he said.
According to him, rice now sells for about N60, 000 per bag, flour at N55, 000, and maize at N30, 000, which is a significant reduction attributed to increased market supply and disruption of hoarding practices by middlemen.
He added that prior to the intervention, traders would often buy and hoard rice paddy after harvest, selling at inflated prices once the season ended.
He also said, “That strategy failed because we brought in imports and sold quickly, forcing prices down. Many hoarders are now counting losses.
“Middlemen had hoarded essential food commodities, hoping to make significant profits following last year’s soaring food prices, which reached an all-time high in the third and fourth quarters. To capitalise on the trend, there was a rush to purchase and store food commodities between November and February, traditionally the peak harvesting season for most crops.
“Ironically, food prices began to decline immediately after the Christmas rush and have continued on a steady downward trend, much to the dismay of hoarders and middlemen.
Further reactions
Meanwhile, a cross-section of Nigerians, who spoke with this reporter, was excited over the drop in the prices of food items.
Paul Ejima, a civil servant, said, “Food is the most basic of human needs and it is the responsibility of the government to ensure food security by ensuring it keeps the prices of stable food at affordable rates. I want to thank the federal government, especially President Bola Ahmed Tinubu for opening the borders.”
Also speaking, a trader who simply identified herself as Josephine, expressed delight at the falling food prices across the country.
She said, “We are finally seeing a drop in the cost of food items like beans, rice, and cooking oil. In markets across the country, prices have fallen significantly, offering a glimmer of relief to struggling households. What is happening is ironic because we are in July which is the peak period when prices of food items typically skyrocket due to limited supplies.
“By this time last year, many families were struggling to have three square meals but there appears to be relief right now. Whatever it is that the government is doing to bring food prices down, I encourage them to keep doing it because it is working.”
Middlemen’s lamentations
Asabe Kefas, a local government employee in Nasarawa state who borrowed money from her workplace’s cooperative society and loans scheme to stockpile rice, is now lamenting her decision. She told Blueprint Weekend that she bought a bag of rice paddy in January for N100, 000, expecting a price hike, but that it is now selling for between N65, 000 and N70, 000.
Asabe is just one of thousands of small-scale food hoarders across the country. Blueprint Weekend gathered that many large-scale hoarders bought rice between December and January at prices ranging from N95,000 to N105,000 per bag.
When asked about the cause of the price crash, a trader who identified himself as Chukwudi attributed it to rumours of massive foreign rice importation by the federal government. He claimed this has disrupted market forces and contributed to the declining cost of food items.
Farmers’ angst
Meanwhile, some farmers have raised concerns that this trend could lead to losses and even discourage people from farming.
Speaking to this newspaper, Kabiru Musa, a farmer in Kaduna state, said, “Honestly, the downward trend in the food prices is discouraging, particularly for farmers who had purchased farm inputs at higher costs.
“It is even more daunting for irrigation farmers, considering the additional cost they incur in buying fuel, pumping devices and other inputs.
“If the government wants to introduce a policy that will crash the price of food items, it is better to start by subsidising farm inputs so as to at least reduce the production costs incurred by farmers. As it is now, the price of farm inputs hasn’t dropped, but that of the produce has drastically dropped,” he said.
Need to empower farmers
In his view, a lecturer in the Department of Agro-Economy, Kogi State University, Dr. Yusuf Ogbaje, advised the federal government to be careful not to cripple local food production with massive importation.
He said, “President Tinubu should prioritise policies that strengthen local agricultural capacity. This includes granting duty waivers not just for imported food, but more importantly for farm inputs, such as seeds, fertilisers, equipment, and agro-chemicals. Supporting local agrochemical manufacturers and agro-merchant firms will boost productivity and reduce dependence on foreign inputs.”
Also speaking, a large scale farmer, Afolabi Jeremiah, said, “Providing farmers with easy access to affordable loans is critical. Many smallholder farmers lack the capital to invest in modern tools or expand their operations. Through targeted financing and robust extension services, the government can unleash the full potential of Nigeria’s agricultural sector,” he said.
He said further: “Agriculture remains an important sector of Nigeria’s economy. Farmers contribute roughly 25% to the nation’s GDP. It is also the largest employer of labour, with over 25 million people, about 30.1% of the total workforce engaged in the sector. According to the Food and Agriculture Organization (FAO), more than 70% of Nigerians participate in agriculture in some form.”