By Benson Daniel
Nigeria’s food sector is facing renewed pressure as food inflation climbed to a six month high of 20.31 per cent in July, raising concerns among farmers and agricultural stakeholders over worsening affordability and declining consumer purchasing power.
The latest increase came despite a moderation in overall inflation, which fell to 15.43 per cent in July from 15.91 per cent in June. The contrasting movements have heightened concerns that the easing of headline inflation has yet to translate into meaningful relief for households struggling with the cost of food.
Food inflation has now increased for six consecutive months, rising from 8.89 per cent in January to 12.12 per cent in February, 14.31 per cent in March, 16.06 per cent in April, 16.96 per cent in May and 17.52 per cent in June before reaching 20.31 per cent in July.
On a month on month basis, food inflation also accelerated to 5.56 per cent in July from 3.75 per cent in June. The increase was driven by higher prices of several food items, including crayfish, fresh pepper, onions, carrots, rice, water yam, tomatoes, garri, plantain, beef, eggs, guinea corn, ginger and plantain flour.
The situation has created a difficult environment for farmers and food producers, who are facing rising production costs at the same time that consumers are becoming increasingly unable to afford their products.
Agricultural operators are contending with higher expenses for transportation, energy, fertiliser and other inputs. These pressures have made it increasingly difficult for producers to maintain profitable operations without passing some of the additional costs on to consumers.
However, higher prices are also weakening demand. Farmers and food producers are increasingly concerned that households with limited disposable income may reduce their consumption of essential food products or switch to cheaper alternatives.
The challenge has become particularly visible in the poultry industry, where producers have reported significant wastage of eggs because of weak consumer demand.
Agricultural stakeholders have warned that the combination of high production costs and weak purchasing power could create a cycle in which farmers reduce production, consumers face higher prices and food insecurity becomes more pronounced.
The situation also highlights the structural challenges confronting Nigeria’s agricultural sector. Poor rural infrastructure, high transportation costs, inadequate storage facilities and limited access to affordable financing continue to increase the cost of getting food from farms to consumers.
Energy costs have also become an important concern for farmers and agro processors who rely on fuel powered equipment for irrigation, processing, storage and transportation.
The continued increase in food inflation therefore presents a challenge for both agricultural producers and policymakers. While farmers require better conditions to increase production, consumers need prices that remain within the reach of ordinary households.
Agricultural stakeholders have consequently called for stronger support for local production, improved access to affordable farm inputs, better transportation networks and investment in storage and processing facilities.
Addressing these challenges would help reduce post harvest losses, improve food supply and lower some of the costs currently passed through the agricultural value chain.
The latest inflation figures suggest that Nigeria’s food affordability challenge remains serious despite improvements in some broader economic indicators.
Without sustained intervention to reduce production and distribution costs while improving agricultural productivity, farmers and consumers could continue to face pressure in the months ahead.
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