Nigerians are in for a sustained price increase this Christmas as prices of commodities continue to spike.
In our recent Nairametrics Bi-weekly Food Price Survey, prices of major household commodities increased significantly over the last two weeks. We also observed a slight dip in the price of foreign rice due to the various local rice options available in the market.
According to the latest household survey conducted by the Research Team, a big basket of tomatoes increased significantly to N10,000, while a big bag of dry onions spiked significantly by 122% to sell at N40,000. A bag of new onions costs N30,000 from an initial N13,000 which indicates a 130.8% increase.
Recall that in an earlier survey, Nairametrics Research Team reported that locally-produced rice has gained huge momentum, as various brands of local rice have now flooded major markets in the country. Following this, the latest survey shows that the prices of foreign rice brands dropped to an average of N26,750 from N28,000 sold two weeks ago, while the price of locally made rice now sells for an average of N21,375 from N21,750.
This report covers items that witnessed increase in prices over the course of two weeks, special markets and insights.
Items that witnessed increase in price
- A 50kg bag of beans (oloyin) now sells for an average of N13,000 compared to N12,875 recorded two weeks ago, indicating a 1% increase.
- A bag of white beans increased by 1.2% as it now sells for an average of N21,250 as against N21,000 recorded last two weeks.
- A 50kg bag of yellow garri rose by 2.1% as it sells for an average of N6,125 from an initial average of N6,000.
- The price of a big basket of Irish potatoes increased from an initial N20,000 to N22,000. This change indicates a 10% increase in the price of the commodity within the space of two weeks.
- A big basket of round shaped tomatoes increased significantly by 11.1% to sell at an average of N10,000 from an initial N9,000.
- The price of a big basket of oval-shaped tomatoes also witnessed a significant increase of 14.3%, as it now sells for N8,000 compared to an initial N7,000.
Items that reduced in price
- A 50kg bag of Royal Stallion rice reduced by 4.5% from an initial average of N28,000 to N26,750.
- Also, a 50kg bag of Caprice reduced significantly by 6.7% to sell at N26,150 compared to the N28,000 of two weeks ago.
- Locally made Mama’s Pride rice (50kg) also witnessed reduction in price, as it now sells for an average of N21,375, indicating a 1.7% decrease, compared to N21,750 a fortnight ago.
- A bag of garri (Ijebu) reduced by 3.6% to sell for an average of N6,700, compared to N6,950 recorded earlier, while a 50kg bag of white garri reduced by 2% to sell at an average of N6,125.
- A big basket of sweet potatoes reduced by 10% from N5,000 to sell at N4,500.
Items that maintained previous prices
Despite the changes in price of many commodities, some items maintained their prices over the past two weeks.
- The prices of bread still cost the same, as 1 loaf of Val-U and Butterfield bread cost an average of N300.
- The different sizes of yams cost the same as recorded two weeks ago, as a big tuber costs N850, while a medium-sized tuber of yam sells for an average of N625.
- Juice such as 5 Alive and Chivita costs an average of N500.
- Noodle brands sell for the same price as they did a fortnight ago. A carton of Indomie (Hungry man) sells for an average of N3,200, while Chikki (100g) sells for an average of N2,100.
- The price of household cooking gas remained the same; 12.5kg of gas cost an average of N3,900, while 5kg costs N1,525.
- Plantain is cheap at Idi-Oro market. In an interview with a plantain seller at the market, Nairametrics Research gathered that a bag of plantain now sells for between N3,000 and N3,500 compared to the previous N5,000. A big bunch (6 x 6) is currently sold for an average of N8,000, indicating a significant 46.6% decrease from N15,000.
- Melon (egusi) now sells for an average of N47,000 at Mile 12 market from an initial N50,000, while bush mango (ogbono) maintains its earlier price of N60,000 per bag. A nylon of crayfish increased by 33.3% to sell for N12,000 compared to a previous N9,000.
- As Nigeria continues to leave its border closed, prices of frozen chicken have continued to jack up despite low patronage. Frozen food items at Mushin market sell for the following:
Orobo chicken sells for N14,000 from N10,500.
Normal chicken sells for N13,500 from N9,500.
Turkey sells for N16,000 from N12,000 two weeks ago.
Soft chicken sells for N13,500 from N9,500.
- The price of maize varies, depending on the freshness of the item. A visit to Mile 12 market showed that a bag of yellow maize costs N21,000, while that of white maize costs N19,000. However, at Mushin market, a bag of yellow maize sells for an average of N13,000, while white maize costs N11,500. A paint bucket of yellow maize and white maize is sold for N500 and N450 respectively.
- Nairametrics Research team gathered that varieties of locally made rice continue to flood major markets and they differ in quality and prices. In an interview with a rice dealer at Daleko market, local rice brands with higher quality are sold for an average of N20, 500.
“Mama’s Pride, Mama’s Choice, Umza, Tomato King and Aliamza are examples of brands that cost N20,500 because they are made like imported Cotonou rice. Some dealers earlier bagged these brands of rice into foreign bags to sell for a high cost,” a major rice dealer disclosed to Nairametrics. Other brands of rice that sell for N19,500 include Shamad, Classic Gold, Royal Naija and Tomato Aroso.
- The Research Team also found that foreign rice brands are currently witnessing low patronage, as the varieties of locally produced rice continue to flood major markets. As a result, the price of imported rice is crashing.
- Also, the Research Team found that a bag of pepper dropped significantly to N14,000 at Mile 12 market compared to the N16,000 it previously sold for. However, the item sells for an average of N15,000 at early hours and reduces to N14,000 by noon.
- Dealers of onions disclosed to Nairametrics Research Team that the price of onions is expected to increase until the end of the year, as the Christmas festive season approaches.
One of the market traders interviewed said, “The rise in the prices of some items at the market is expected to last till the end of the year, as it is the normal trend during the yuletide period.”
About Nairametrics Food Price Survey
The Nairametrics Food Price Watch is a bi-weekly household market survey that covers prices of major food items, with emphasis on four major markets in Lagos – Mushin Market, Daleko Market, Oyingbo Market, Idi-Oro Market and Mile 12.
|Items||Brand||Unit||MUSHIN (21/11/2019)||DALEKO (21/11/2019)||OYINGBO (21/11/2019)||MILE 12 (21/11/2019)||Average||MUSHIN (17/11/2019)||DALEKO (17/11/2019)||OYINGBO (17/11/2019)||MILE 12 (17/11/2019)||Average|
|Bag of Rice||Basmati||5kg||NA||NA||NA||NA||NA||NA||NA||NA||NA||NA|
|Bag of Rice||Mama Gold||10kg||NA||NA||NA||NA||NA||NA||NA||NA||NA||NA|
|Bag of Rice||Royal Stallion||50Kg||28000||26000||28000||25000||26750||NA||NA||28000||28000||28000|
|Bag of Rice||Rice Master||10kg||NA||NA||NA||NA||NA||NA||NA||NA||NA||NA|
|Bag of Rice||Mama Gold||50kg||22000||20500||22000||21000||21375||22000||20500||21000||22000||21375|
|Bag of Rice||Caprice||50kg||26500||26000||27000||25000||26125||NA||NA||28000||28000||28000|
|Bag of Rice||Mama's Pride||50kg||22000||20500||22000||21000||21375||22000||21000||22000||22000||21750|
|Bag of Rice||Falcon||25kg||NA||NA||NA||NA||NA||NA||NA||NA||NA||NA|
|Bag of Beans||Oloyin||50kg||13000||12000||13000||14000||13000||13000||12000||13000||13500||12875|
|Bag of Beans||White||50kg||22000||20000||22000||21000||21250||22000||20000||22000||20000||21000|
|Bag of Beans||Brown||>50kg||24000||22000||24000||24000||23500||24000||22000||24000||24000||23500|
|Tuber of Yam||Abuja||1 Big Size Tuber||900||800||900||800||850||900||800||900||800||850|
|Tuber of Yam||Abuja||1 Medium Size Tuber||650||600||650||600||625||650||600||650||600||625|
|Carton of Noodles||Indomie||305g (Belle full)||2900||2900||2900||2900||2900||2900||2900||2900||2900||2900|
|Carton of Noodles||Indomie||200g (Hungry man)||3200||3200||3200||3200||3200||3200||3200||3200||3200||3200|
|Carton of Noodles||Chikki||100g||2000||2200||2100||2100||2100||2000||2200||2100||2100||2100|
|Carton of Noodles||Minimie||70g||1500||1500||1500||1500||1500||1500||1500||1500||1500||1500|
|Carton of Noodles||Golden Penny||70g||1400||1400||1400||1400||1400||1400||1400||1400||1400||1400|
|Bag of Garri||Ijebu||80kg||6000||6800||7000||7000||6700||7000||6800||7000||7000||6950|
|Bag of Garri||White||50kg||5500||6000||6500||6500||6125||6000||6500||6500||6000||6250|
|Bag of Garri||Yellow||50kg||5500||6000||6500||6500||6125||6000||6500||6000||5500||6000|
|Basket of Potato||Sweet||Big Basket||4500||4500||5000||5000|
|Basket of Potato||Sweet||Small Basket||700||700||700||700|
|Basket of Potato||sweet||Smallest Basket||200||200||200||200|
|Basket of Potato||Irish||Biggest Basket||22000||22000||20000||20000|
|Basket of Potato||Irish||Medium Basket||2000||2000||2000||2000|
|Basket of Potato||Irish||Small Basket||1500||1500||1500||1500|
|Packet of Pasta||Golden Penny||500g||4200||4200||4300||4200||4225||4200||4200||4300||4200||4225|
|Packet of Pasta||Dangote||500g||4000||4000||4000||3900||3975||4000||4000||4000||3900||3975|
|Packet of Pasta||Power (1 pc)||500g||220||220||220||200||215||220||220||220||200||215|
|Packet of Pasta||Bonita (1 pc)||500g||220||200||200||210||207.5||220||200||200||210||207.5|
|Gallon of Palm Oil||Local||5 Litres||2000||1700||2000||1700||1850||2000||1700||2000||1700||1850|
|Gallon of Palm Oil||Local||25 Litres||10500||9000||9500||9000||9500||10500||9000||9500||9000||9500|
|Gallon of Vegetable Oil||Local||5 Litres||2000||1900||2000||2000||1975||2000||1900||2000||2000||1975|
|Gallon of Vegetable Oil||Local||25 Litres||12000||9500||11000||9500||10500||12000||9500||11000||9500||10500|
|Gallon of Vegetable Oil||Kings||5 Litres||3000||3000||3000||3000||3000||3000||3000||3000||3000||3000|
|Gallon of Vegetable Oil||Wesson||5 Litres||3900||3900||3900||3900||3900||3900||3900||3900||3900||3900|
|Gallon of Vegetable Oil||Mamador||3.8 Litres||2500||2450||2500||2400||2462.5||2500||2450||2500||2400||2462.5|
|Gallon of Vegetable Oil||Power||3 Litres||1800||1800||1800||1800||1800||1800||1800||1800||1800||1800|
|Bunch of Plaintain||Plaintain||1 Big Bunch||400||400||350||400||387.5||400||400||350||400||387.5|
|Bag of Flour||Dangote||50kg||11200||11200||11200||11500||11275||11200||11200||11200||11500||11275|
|Bag of Flour||Honey well||50Kg||11500||11200||11200||11200||11275||11500||11200||11200||11200||11275|
|Bag of Flour||Mama Gold||50kg||11500||11300||11000||11300||11275||11500||11300||11000||11300||11275|
|Bag of Sugar||Dangote||50kg||3500||3200||3400||3200||3325||3500||3200||3400||3200||3325|
|Milk||Peak Powdered (Tin)||400g||1250||1200||1200||1200||1212.5||1250||1200||1200||1200||1212.5|
|Milk||Peak milk (Refill)||500g||1050||1000||1000||1000||1012.5||1050||1000||1000||1000||1012.5|
|Milk||Dano Powdered (Tin)||500g||1000||1000||1000||1000||1000||1000||1000||1000||1000||1000|
|Milk||Loya Powdered (Tin)||400g||1000||1000||1000||1050||1012.5||1000||1000||1000||1050||1012.5|
|Cocoa Beverages||Milo (Tin)||500g||1000||1100||1050||1000||1037.5||1000||1100||1050||1000||1037.5|
|Cocoa Beverages||Milo (Tin)||900g||2000||2100||2100||2100||2075||2000||2100||2100||2100||2075|
|Cocoa Beverages||Milo Refill||500g||900||900||900||900||900||900||900||900||900||900|
|Cocoa Beverages||Bournvita Refill||500g||950||900||950||900||925||950||900||950||900||925|
|Cocoa Beverages||Bournvita (Plastic)||900g||2000||2000||2000||2000||2000||2000||2000||2000||2000||2000|
|Cocoa Beverages||Ovaltine Refill||500g||800||800||850||850||825||800||800||850||850||825|
|Tea||Lipton Yellow label||52g||310||290||300||300||300||310||290||300||300||300|
|Sugar||St' Loius Sugar(Cube)||500g||400||380||400||450||407.5||400||380||400||450||407.5|
|Sugar||Golden Penny Sugar (cube)||500g||350||300||350||300||325||350||300||350||300||325|
|Bottled Water (Refill)||Cway||Refill||600||600||650||600||612.5||600||600||650||600||612.5|
|Juice||5 Alive||1 litre||600||550||550||600||575||600||550||550||600||575|
|Tomatoes||Big Basket||round shaped||10000||10000||9000||9000|
|Medium Basket||round shaped||7000||7000||6500||6500|
|Small Basket||round shaped||6000||6000||6000||6000|
|Big Basket||Oval Shaped||8000||8000||7000||7000|
|Small Basket||Oval Shaped||5000||5000||4500||4500|
|Fish||Kote (Horse Mackerel)||1 kg||500||450||480||450||470||500||450||470||450||467.5|
|Fish||Titus (Mackerel)||1 kg||500||480||500||490||492.5||500||500||500||490||497.5|
Dangote Sugar, sweet in more ways than one
Significant growth in gross revenue was driven largely by sale to Nigerian Bottling Company Limited and Seven-Up Bottling Company Limited.
By refining capacity, Dangote Sugar Refinery Plc (DSR Plc) is acknowledged as the largest Sugar Refinery in sub-Saharan Africa and one of the largest in the world. With up to 60 percent market share, it is also clearly, the most dominant player in the Nigerian sugar market.
DSR Plc recently released its audited Financial Statements for the year ended December 31, 2020 and overall and year-on-year group performance results were very good.
Despite the impact of the Covid-19 induced lockdown which curtailed distribution across the country and resulted in decreased revenues from income generated from freights, gross revenues increased by over 33 percent year-on-year to ₦ 214.3 billion. The significant growth in gross revenue was driven largely by a rise in revenue from the sale of its 50kg sugar, with the two main customers being the Nigerian Bottling Company Limited and Seven-Up Bottling Company Limited who operate principally from Lagos.
Year-on-year, gross profit increased by over 40 per cent to ₦ 53.75 billion, Profit before tax increased by almost 53 per cent to ₦ 45.62 billion, and Profit after tax increased by 33 per cent to ₦ 29.78 billion.
Notwithstanding the good result, the group operating results showed some issues and headwinds. First, during the year, DSR Plc wound up Dangote Niger Sugar Limited (one of four companies that had been set up to acquire large expanse of land and locally grow sugarcane as part of its concerted backward integration project). The winding-up was sequel to continued community dispute over land acquired in Niger State for this purpose. This winding-up event cost DSR Plc approximately ₦ 100 million.
Second, there continues to be a heavy reliance on Lagos for its gross revenues as revenues generated from Lagos State increased significantly from circa 33 per cent at the end of 2019 to over 50 per cent by the end of 2020. The share of the Lagos segment in gross revenue thus continued to grow and currently represents a significant market concentration risk for DSR Plc.
Third, provision for impairment on financial assets or in simple terms, receivables that are unlikely to be collectable, also trended upwards from ₦ 1.3 billion in 2019 to ₦ 1.45 billion by end of 2020 with net financing expenses also rising significantly from ₦ 516.2 billion in 2019 to ₦ 1.92 billion by the end of 2020. This rise in expenses was largely driven by a significant rise in exchange losses incurred in the ordinary course of business, rising from about ₦ 7 million in 2019 to over ₦ 1.57 billion at the end of 2020.
Finally, administrative expenses represented mainly by employee salaries grew year-on-year by over ₦ 1.2 billion.
With the recent reopening of land borders, we expect that revenues and margins will become squeezed as sales and production volumes become constrained by the influx of largely smuggled, lower quality, and much cheaper sugar and its substitutes. DSR Plc’s sugar refinery is also strategically located very close to the Apapa port and its logistics operations, distribution of raw materials and delivery of finished goods will continue to be impacted by the infamous Apapa Traffic Gridlock and road diversions/closures around the axis. Although the effort of Lagos state and the recent introduction of the electronic call up of truck by the NPA has eased the issue, still, it needs to be watched closely.
Earnings per share at the end of 2020 was ₦ 2.45 (2019: ₦ 1.87; 2018: ₦ 1.85)
Subject to approval at its forthcoming Annual General Meeting, DSR Plc board of directors have proposed a dividend of N1.50k per ordinary share (2019: ₦ 1.10k, 2018: ₦ 1.10k).
This performance is sweet in more ways than one.
CBN “Naira 4 Dollar Scheme” Explained
What the CBN’s Naira 4 Dollar scheme means for your money.
In what appears to be an attempt to incentivize dollar remittances by all means possible, the Central Bank of Nigeria (CBN) released a circular to Deposit Money Banks (DMBs), International Money Transfer Operators (IMTO), and the General Public, advising that remittances paid into a bank account will attract an additional credit alert for every USD$1 received!
Yes, you read that correctly. The CBN will facilitate a special additional credit alert of N5 for every USD$1 received. In other words,
- if someone sends you $10,000, you get an additional special credit alert for N50,000.
- If someone sends you $100,000, you get an additional special credit alert for N500,000.
Who is eligible?
To be eligible, the diaspora remittances need to be processed and received from one of the registered IMTOs and funds received into a Bank account operated by the DMBs. (So, if you are receiving funds via Crypto sorry you are not eligible).
Additionally, the circular says this “incentive runs from Monday 8th March 2021 to Saturday 8th May 2021″. So, if you have plans to receive dollars, you can plan accordingly.
The circular is not clear how exactly the commercial banks will know which account to pay the extra special credits into. Although, that may be a question diaspora funds recipients will need to ask their DMB accounts officers to clarify for them.
How will this be funded?
The circular notes that the “CBN shall through commercial banks, pay to recipients the N5 incentive for every USD$1”. In other words, it is the CBN funding the cost of this special extra credit.
- One would argue that given the costs of alternative incentives to attract dollars such as the special OMO window for FPI, this may be a cheaper alternative for the CBN.
- But we will need to see the volume of expected remittance to be certain of that. Nigeria attracts about $5billion per quarter in remittances and only trails oil in terms of foreign earnings.
Why this matter to Nigerians?
Following the collapse of US Dollar inflows into the country, the CBN initially tried to balance its current account deficits and avoid an official devaluation by tackling FOREX demand (Think ban of 41 items, etc).
- However, in recent times, CBN is now trying to address the challenge of FOREX supply. In 2019, CBN restricted OMO bills for FPIs, and this year, CBN directed all IMTOs to discontinue the practice of not remitting dollars into the country but keeping it overseas and sending Naira.
- Also, the IEFX rate has been allowed to continually diverge from the official rate. As at close of business on Friday 5th March 2021, the IEFX rate of N412.50 is 8.8% premium to the official rate of N379.
- Some may point out that, if the CBN is looking to have ordinary Nigerians enjoy some benefits from its ongoing FX subsidy largesse then maybe that is “arguably” more palatable than the prior focus on FPIs.
Finally, this short-term Naira-4-Dollar scheme will not be called an official Naira Devaluation. But a question is what do we call the new short-term price of N412.50 + N5.00? Maybe we can call it Naira Modulation.
Nairametrics | Company Earnings
Access our Live Feed portal for the latest company earnings as they drop.
- Seplat falls into a loss in FY 2020
- 2020 FY Results: Cornerstone Insurance Plc reports a 61.1% decline in profit
- Ellah Lakes increases operating expenses by 33.36% in HY 2020
- 2020 FY Results: Nigerian Breweries reports a 54.3% decline in profits in 2020
- Abbey Mortgage Bank projects N51.08 million profit in Q2 2020.