How much of your household income is spent on food? 30%, 40%, 50%? The answer varies widely based on the size of the household, its income level and whether that household lives in an urban or rural community. However, the sad reality is that according to 2009 data collected by the US Department of Agriculture, the average Nigerian household spends approximately 70% of its income on food. Contrast this statistic with the United States' 9%, Cameroon's 43%, China's 35% and Brazil's 25%.
There are many complex reasons for this reality. A leading cause is that despite our country's natural assets including its land, climate, rainfall, able bodied people, its coastal areas and rich history as an agrarian economy, prices of local produce are extremely high and the country remains a net importer of food. Why is this the case?
First, the average Nigerian farmer achieves yields that are significantly lower than those generated by their counterparts in other countries. For example, rice production in Nigeria generates 1.7 tons per ha on average. Coupled with high labour costs, this results in a price of paddy of about US$ 300/MT compared with $130-$140/MT in Thailand. This is primarily because majority of the agriculture-focused operations in the country are small scale, dominated by small holder farmers who operate at a subsistence level. With limited innovation around inputs - water, soil health, seeds, production techniques and poor, harvesting, processing, distribution, and access to markets, and limited training, they perform significantly below their potential. The fact that less than 10% of Nigerian farmers use irrigation means that the masses of people can only enjoy low prices when produce is in "season," as opposed to all year round as in many other countries. Even when the produce in season, there is tremendous waste due to poor harvesting and storage.
Second, Nigeria imports 90% of the processed food consumed in the country. This is primarily because the country's policy and operating environment does not support local agricultural growth and food processing. There are weak, un-enforced, unimplemented and often conflicting policies at the local, national or regional level which often frustrate operators across the agricultural value chain. In addition, the neglect of the local manufacturing sector and the poor infrastructure across the country, including the epileptic power situation, absence of feeder road and other transportation networks and limited access to affordable financing (even though this is changing with the recent reforms at the Central Bank of Nigeria) ensure that our local processors cannot compete relative to cheaper imports.
This challenge was effectively captured in a recent Economist article which stated- "Once West Africa's breadbasket, Nigeria can no longer feed itself. Last year it spent $1 billion on importing rice-ten-year-old rice from Indian grain reserves-while close to 40% of its own harvest rotted, mostly for lack of roads to markets and processing plants."
Third, the"proudly Nigerian" movement has been largely bastardized. For most products which bear the logo, only the water used in the production or the staff who package the already processed imports are Nigerian. In addition, the mindset that "foreign" is better, even when it comes to food still lingers, with little regard for the amount of preservation that is required to ensure that food can survive 2-4 months at sea. Our taste buds have evolved and our local produce has been displaced by food from abroad. For example, the average Nigerian family prefers to consume bread and tea for breakfast, when the ingredients - sugar, milk, flour and even the tea are all imported. This focus on imports and opaque quotas essentially means that the income generated by the masses of Nigerian people will continue to end up in the hands of farmers and processors in Thailand, India, Brazil, the Netherlands, South Africa and even Ghana.
The public, private and nonprofit sectors all have critical roles to play in addressing these three challenges. The public sector is responsible for creating an enabling environment for agriculture to thrive. As a result, it is imperative that the new administration institutes and enforces consistent and reinforcing government policies that favour local farmers, processors, consumers and actors across critical value chains. There is also an urgent need to streamline and harmonize institutions and activities being managed by various ministries including the National Planning Commission and the Ministries of Agriculture & Water Resources, Commerce & Industry, Finance, Environment and Works to ensure that they work collaboratively to support the growth and competitiveness of the agribusiness sector.
The Nigerian private sector also has a critical role to play as the real driver of growth and competitiveness. A first step is that agriculture needs to be recognized as a pivotal business sector in Nigeria, and farmers and fishermen need to be recognized as entrepreneurs, who require support. Working in collaboration with our academic and research institutions, the private sector can capitalize on innovations in processing and packaging to reduce the waste and inefficiencies in the sector. In addition, entrepreneurs need to work collaboratively across strategic value chains to fill critical gaps, which will invariably increase the efficiency and effectiveness of the sector, and ultimately reduce the cost of food.
Civil society needs to educate Nigerian consumers on the value of locally processed food, and also actively lead efforts to hold the public and private sectors responsible for their activities in the sector. Local nonprofits also need to support actors across the value chain through the provision of training, extension, financing, linkages and other services.
Nigeria cannot afford the risks associated with a continued neglect of the agriculture sector - including deepening poverty and increased insecurity. There is a real need for urgent attention and immediate action to ensure that the average Nigerian is able to eat and live within his or her means!
