The Nigeria Customs Service has confirmed the 4 companies that have been given the CBN emergency approval to imports 262,000 tons of maize into Nigeria.
The companies are Wacot Limited, Chi farms Limited, Crown Flour Mills Limited and Premier Feeds Company Limited.
This was disclosed in a memo with reference number: NCS/T&T/I&E/021/S.93/VOL on Thursday evening signed by the Deputy Comptroller General, T.M ISA and seen by Nairametrics.
The letter said, “in line with the government’s policy on food security, sufficiency and striking a balance between food imports and local production capacities to meet anticipated shortfall, the Central Bank of Nigeria has granted approval for the underlisted companies to import maize in the quantities stated below”.
The memo also noted the banks to conduct the transactions with, the names of the companies, and the quantity each company is approved to import.
Wacot Limited, approved to import 60,000 tons , conducting half of the approved capacity with Citi Bank and Titan Trust Bank respectively.
Chi Farms Limited will import 60,000 tons of maize banking with Titan Trust Limited.
Crown Flour Mills, with the lowest capacity approval, would import 22,000 tons via Coronation Bank.
Premier Feeds Company Limited got the highest capacity approval at 120,000 tons and will bank with Zenith Bank for the transaction.
The Nigeria Customs Service warned that only the above 4 companies are allowed to import maize into the country and the exercise would run strictly from August to October.
On Thursday, President Muhammadu Buhari had announced the Federal government’s plan to release 30,000 tons of maize from the national reserves to animal feed producers to deal with the high cost of poultry production after the ban on maize imports.
“We are very mindful of the challenge of high food prices, at a time when the economy is already in a slowdown caused by the global coronavirus situation, and are doing everything in our power to bring down the prices of food items across the country,” Buhari said.
Gold drops to $1,700 territory for the first time since June
Gold futures lost about 1.3% to close at $1,1781.90/ounce, dropping as low as$1,770.65, a price not seen since June 22.
The demand for gold diminished at the last trading session of the week, as it fell to $1,700 territory — the first time since June.
What we know
Gold futures lost about 1.3% to close at $1,1781.90/ounce. It dropped as low as $1,770.65, a price not seen since June 22.
Gold bulls have been under intense pressure amid significant sell-offs recorded in recent times, amid positive news on COVID-19 vaccines coupled with strong bias coming from the world’s largest economy, hinting that there would be a smooth transition of power. All of these factors have kept gold bulls in the dust.
What this means
Gold traders are arbitrarily reducing their long bets, as it seems odd for any investor to go bullish on the precious metal, taking to account that it’s set for the third straight weekly loss.
Stephen Innes, Chief Global Market Strategist at Axi, in an email sent to Nairametrics, gave key fundamentals giving the gold bears enough gas to break the precious metal below the $1,800 price level:
“The positive correlation between gold and the SPX since March flipped after Pfizer’s vaccine announcement on Nov. 9, while negative real yields are not having a positive effect on the precious metal. A transition from disinflationary to inflationary support for gold could take time and ultimately leaves prices vulnerable to more profit-taking and the establishment of more shorts in the near-term.
“Gold rout continues as investors embrace vaccine news. The break of USD1,800/oz support may take prices near USD1,750/oz as surging investor optimism due to promising COVID-19 vaccines has undermined gold and silver.”
What to expect
The precious metal will continue to be under immense pressure from the gold bears, taking into account the commanding macro theme related to a vaccine recovery and the reduced risks associated with central bank’s debt monetization, or the pursuit of quasi-modern monetary theory.
CBN Governor says Nigeria’s external reserves sufficient to cover 7-months import
The CBN Governor has insisted that Nigeria’s current external reserves is sufficient to cover 7 months of imports of goods and services.
The Governor of the Central Bank of Nigeria (CBN), Mr Godwin Emefiele, has said Nigeria’s external reserves, which is currently at $35bn, is sufficient to cover 7 months of imports of goods and services.
This disclosure was made by Emefiele at the 55th Annual Bankers Dinner organized by the Chartered Institute of Bankers of Nigeria in Lagos on Friday.
He pointed out that like other emerging market countries and countries that rely on earnings from oil exports, the decline in crude oil earnings, as well as the retreat by foreign portfolio investors, significantly affected the supply of foreign exchange into Nigeria.
Emefiele said, “Our external reserves currently stand above $35bn and are sufficient to cover seven months of import of goods and services.’’
‘’In order to adjust for the decrease in the supply of foreign exchange, he said the naira depreciated from N305/$ to N360/$, and subsequently to N380/$.’’
“With the decline in our foreign exchange earnings and successive exchange rate adjustments, the CBN has continued to implement a demand management framework, which is designed to bolster the production of items that can be produced in Nigeria, and aid conservation of our external reserves.
“Due to the unprecedented nature of the shock, we continued to favour a gradual liberalization of the foreign exchange market in order to smoothen exchange rate volatility and mitigate the impact which, rapid changes in the exchange rate could have on key macro-economic variables.’’
“This we believe is in line with international best practices in countries where managed float arrangements are in operation,’’ he said.
The CBN Governor reiterated that the measures being put in place by the authorities to improve the non-oil exports and other sources of foreign exchange had helped to prevent a significant decline in the country’s reserves.
What you should know: External reserves management according to the CBN act, is guided by core objectives like providing a level of confidence to markets that a country can meet its external obligations, hedging the domestic currency, limiting external vulnerability and providing adequate liquidity to finance day-to-day official transactions and unforeseen needs.
This will also help the CBN maintain some stability in the foreign exchange market in the next few months. The continuous drop in the country’s external reserve will impact negatively in the forex market which has already been under intense pressure for some months.
Exited N-Power beneficiaries to apply for CBN empowerment options
A portal to enable Exited N-Power beneficiaries apply for CBN empowerment options has been launched by the Ministry of Humanitarian Affairs.
The Ministry of Humanitarian Affairs, Disaster Management, and Social Development has launched a portal enabling exited N-Power beneficiaries to apply for CBN empowerment options.
This was disclosed by the Ministry in a social media statement on Friday evening.