Recent reports have revealed that Nigeria’s food import bill has remained high due to the country’s heavy reliance on imported food essentials like wheat, rice, and sugar . Nigeria spent an astounding $689.88 million on food imports in the first quarter of 2024. This amount, which accounts for 17% of the nation’s overall foreign exchange expenditure for the time period, indicates a substantial financial commitment to obtaining food items from overseas markets. According to the data, Nigeria’s food import cost has experienced notable fluctuations over time, which can be attributed to variations in domestic agricultural output, economic policies and global food prices.
The Central Bank of Nigeria (CBN) quarterly statistical bulletin provides sector-specific data on the use of foreign exchange during the reviewed period. It shows that the industrial sector gulped the highest share of foreign exchange expenditures, followed by the food product sector while the agricultural sector, which is the backbone of food production in the nation, recorded the lowest foreign exchange expenditure. In order to lower the cost of food commodities, the government has implemented a duty-free window for a certain category of food imports in response to the crippling food crisis.
Duty-free imports expected to last till October.
While the goal is to reduce inflation, critics contend that bringing in these food items duty-free could jeopardize domestic production. They maintained that in order to improve domestic output and lessen dependency on imports, the agricultural industry requires more government support. The national president of the All Farmers Association of Nigeria (AFAN), Kabir Ibrahim, asserted that progress achieved in local production of wheat, rice, and maize will be eroded if food goods are imported duty-free. He highlighted the necessity of government funding for regional Agriculture in the form of input Subsidies for items like fertilizer and machinery.
Minister of Agriculture and Food Security Abubakar Kyari explained that the duty-free imports are a short-term solution that will likely end in October or November 2024, when the next harvest occurs. He blamed the lean agricultural season, which has resulted in low crop yields and high food prices, for the need for imports. Up until harvest, the government intends to import between 300,000 and 400,000 metric tonnes of staple foods each month. The cost of importing wheat contributes highly to the value of food imports during the time under review.
Disparity remains between supply and demand.
However, the rising food import bill has sparked worries about the country’s food Security and the need for measures to boost domestic agricultural output. With the recent spike, spending has increased by 40% over the previous quarter. This shows the increasing need for importation to meet local demands, despite the country’s tremendous agricultural potential. The current food price issue has caused Nigeria’s food import bill to rise to a five-year high and in April of this year, the country’s food Inflation rate jumped to 40.5 percent.
Households across the nation, particularly low income earners, are suffering greatly as a result of the rapid increase in food prices, which is further straining the already weakened economy. Despite government endeavours to boost Local Food production through Sustainable Agricultural practices, there is still a large disparity between supply and demand. Many people are currently malnourished and incapable to afford a healthy diet because of the rising cost of living, especially food staples, in Nigeria, which is growing at its fastest rate in almost 30 years due to internal and external factors.
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According to data from the National Bureau of Statistics, the value of imported agricultural goods in the first quarter of 2024 was ₦920.54 billion, up 29.45% from the previous quarter and 95.28% from the same time in 2023. Amidst the high rate of food imports over the years, there have been multiple reports of food Smuggling to outside the nation, making food security issues worse and undermining government actions to cut back on imports.