Nigeria imported agricultural goods worth N512.91 billion in the third quarter of 2022, marking a 10.4% increase compared to N464.4 billion recorded in the previous quarter and a 6.4% increase compared to N482.2 billion in the corresponding period of 2021.
On the flip side, Nigeria’s agricultural export fell massively by 40.6% to N84.21 billion in the review quarter from N141.76 billion recorded in Q2 2022. Meanwhile, it increased marginally by 6% compared to the N79.41 billion printed in the same period last year.
These details are contained in the third quarter foreign trade report, released by the National Bureau of Statistics (NBS).
- The decline in Nigeria’s agriculture export was despite huge investments channelled to the sector by the federal government and the Central Bank of Nigeria (CBN). Unfortunately, the report also showed that Nigeria still relies a lot on importation to meet its food demands.
- According to the CBN, a sum of N1.07 trillion has been disbursed under the Anchor Borrowers’ Programme (ABP) to over 4.6 million smallholder farmers cultivating 21 commodities as of September this year.
- Also, the CBN had disbursed a sum of N745.31 billion to finance 680 large-scale projects under the Commercial Agriculture Credit Scheme (CACS). Despite, these interventions, the sector is yet to print the desired level of growth.
Low sectoral growth: Data from the National Bureau of Statistics showed that Nigeria’s agricultural sector grew by 1.34% year-on-year in real terms in the third quarter of the year, a marginal improvement compared to 1.2% recorded in the previous quarter.
- However, compared to 2020 and 2021, where the sector grew by an average of 2.15% and 2.09% respectively, the agricultural sector is growing at a crippling rate.
- Although, it is worth noting that the agricultural sector contributed about 29.67% to the national GDP in Q3 2022, an increase when compared to 23.24% recorded in Q2 2022 but lower than the 29.94% recorded in the corresponding period of 2021.
Rising food inflation: Nigeria’s food inflation rate rose to a 17-year high in October 2022 at 23.72%, while for the review quarter, the food inflation stood at 23.39% compared to Q2’s 20.67%.
- The rising cost of food items in the country has been attributed to the continuous insecurity challenges ravaging the northern areas, coupled with the incidence of flooding as well as disruption in the food supply chain.
- Also, the global energy crisis has affected the level of production as farmers now spend more on diesel to power their machinery as well as for the transportation of goods.
Why this matter: The agricultural sector is very vital to the growth of the Nigerian economy considering the amount of labour it employs as well as the strategic importance it represents in the country’s food security and sustainability.
Due to the lack of adequate production, export value has gone down, limiting the number of FX inflows through non-oil export. Consequently, the lack of production also means that Nigerians will require more importation using scarce FX resources to meet the high food demand in the country.
