LinesWatch Agro Desk
Nigeria’s temporary relaxation of food import restrictions may be easing consumer pain at the markets, but agricultural stakeholders are warning that without complementary support measures, the policy could weaken domestic production and undermine long-term food security.
At a policy forum in Lagos organised by the Plantation Owners’ Forum of Nigeria (POFON) in collaboration with the Oil Palm and Other Oil Seeds Value Chain, agriculture expert Dr Fatai Afolabi delivered a stark message: imports can stabilise prices, but they must not destabilise farmers.
The event, themed “Current Government Food Strategy, the Concomitant Effects and Implications for Food Security in Nigeria,” brought together producers, processors, commodity associations and policy analysts at a time when Nigeria’s food system is navigating one of its most difficult periods in recent history.
A Policy Designed for Relief
Nigeria has faced sustained food inflation over the past two years, driven by currency volatility, insecurity in food-producing regions, high energy costs, climate variability and logistics bottlenecks. According to data from the National Bureau of Statistics (NBS), food inflation has consistently outpaced headline inflation, placing pressure on household incomes and deepening food insecurity.
In response, the Federal Government opted to temporarily relax restrictions on selected food imports to boost supply and moderate prices.
“The decision was understandable,” Afolabi noted. “The market responded swiftly, and prices of major staples declined.”
For urban consumers grappling with soaring costs of rice, vegetable oil and other staples, the impact was immediate relief. But industry stakeholders say the gains may be uneven and potentially short-lived if domestic producers are squeezed out.
The Cost-Price Squeeze on Farmers
While output prices have softened, production costs remain stubbornly high.
Farmers continue to battle:
- Expensive fertilisers and agrochemicals
- High transport and diesel costs
- Costly improved seeds
- Limited access to affordable credit
- Poor rural road infrastructure
- Inadequate storage and processing facilities
This mismatch—declining farm-gate prices alongside elevated input costs—has triggered distress across value chains.
Rice farmers are reportedly among the hardest hit. Stakeholders at the forum cited reports from producing states suggesting that about 3,500 rice farmers are considering exiting cultivation after incurring estimated cumulative losses of over ₦93 billion.
Cassava farmers face a similar squeeze, with farm-gate prices in some areas barely covering harvesting costs. Vegetable oil processors are under pressure as imported brands displace locally refined alternatives. Soybean farmers supplying those processors are experiencing reduced demand and lower prices.
Tree crop producers, particularly oil palm and cocoa farmers, are especially vulnerable. Oil palm plantations require four to five years to mature, while cocoa trees can take several years before yielding commercially viable output. Sudden policy shifts or import surges can erode investor confidence in these long-gestation crops.
A Structural Risk to Food Security?
Afolabi warned that sustained losses could push farmers out of production entirely.
“If farmers exit at scale, Nigeria’s dependence on imports will increase, exposing the country to global supply shocks and foreign exchange pressures,” he said.
Nigeria already spends billions of dollars annually on food imports, including wheat, fish and processed foods. With foreign exchange constraints and a volatile naira, over-reliance on imports creates macroeconomic risks beyond the agricultural sector.
Rural employment is also at stake. Agriculture remains one of Nigeria’s largest employers, particularly in informal and smallholder segments. A contraction in farm activity would ripple through rural economies, agro-processing clusters and logistics networks.
Lessons from India and the Netherlands
Afolabi pointed to global examples of balanced policy design.
In India, food imports are deployed strategically during shortages but are complemented by minimum support prices, input subsidies and public procurement schemes that protect domestic producers.
Meanwhile, the Netherlands—despite being one of the world’s leading agricultural exporters—supports farmers through tax incentives, affordable energy, strong cooperatives and close integration between research institutions and producers.
Agricultural education systems in both countries are also heavily subsidised, ensuring generational continuity and innovation.
“These are ecosystems,” Afolabi said. “Consumer protection and farmer sustainability are not treated as competing objectives.”
Aligning Imports with Harvest Cycles
Stakeholders at the Lagos forum proposed several measures to prevent policy-induced distortions:
- Time-bound and transparent imports aligned with documented supply gaps.
- Publication of a national crop production and harvest calendar to guide import decisions.
- Expanded input subsidies, particularly for fertiliser, seeds and energy.
- Price stabilisation mechanisms to reduce volatility.
- Support for agro-processors to improve competitiveness against imported products.
- Clear communication that import relaxations are strategic and temporary.
“Food imports should function as a strategic shock absorber rather than a permanent market feature,” Afolabi emphasised.
A Delicate Balancing Act
For policymakers, the challenge is clear: how to guarantee affordable food in the short term without undermining domestic capacity in the long term.
Affordable food and profitable farming, stakeholders insist, are not mutually exclusive goals. But achieving both will require coordination across fiscal, trade, infrastructure and agricultural policy.
As Nigeria navigates inflationary pressures and supply constraints, the choices made today could determine whether the country emerges with a stronger, more resilient food system—or deeper structural dependence on global markets.
For industry players across oil palm, rice, cassava, cocoa and edible oil value chains, the message from Lagos was unmistakable: stabilisation must not come at the expense of sustainability.