Flour Milling Association urges FG to suspend 15% cassava levy

The Flour Milling Association of Nigeria (FMAN) has urged the federal government to suspend the 15% levy on cassava production.

This was imposed following the alarming insecurity issues in the wheat-planting belt of Nigeria and the agricultural sector.

The association stated that despite the rapid growth in cassava production, the cassava sub-sector in Nigeria has still been constrained by a number of factors. They warned that the imposed levy would only succeed in increasing the cost of production of millers and bakers in the country.

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Additionally, the association urged the government to assist local wheat farmers in the acquisition of improved wheat seed varieties and also explore other measures to support millers and bakers in the country.

They also warned of an impending food crisis in the country while citing the prevailing economic conditions and unfavourable regulatory frameworks. They explained that as a result of the global COVID-19 restriction policies which disrupted supply chains, and unfavourable foreign exchange regimes, securing food for the average Nigerian has become tougher to sustain.

The association explained that in the face of impending crisis, the Nigerian government needs to get into action and address the country’s food security, especially around the wheat sector, because of its importance in every home in Nigeria.

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According to them, the current price hike in the global wheat market has constituted an operational strain which is heavily impacting the cost of production of millers and also has the potential to further elevate wheat-based staples prices.

They also stated that as early as the first quarter of 2021 the global price of wheat rose to $642 per bushel in January 2021 and then $650 per bushel by the end of the quarter. Further market pressures saw prices settle at $726.75 per bushel in May.

However, by the end of June 2021, the price had dropped to $693.5 per bushel, before gaining pressure and reaching $707 per bushel in July 2021.

Furthermore, they revealed that in the event of a third wave of COVID-19 outbreak, especially considering the widening spread of the new Delta variant, the flour milling industry could be greatly hit if urgent steps are not taking to prevent it.