Agriculture, which is one of the key sectors government has given priority to drive Nigeria’s non-oil sector towards food productivity and security, holds enormous potential for investors this year. TAIWO HASSAN writes
Since independence in 1960, agriculture had been the mainstay of Nigeria’s economy, providing the largest chunk of foreign exchange inflow into the country. Moreover, it contributed about 63 per cent to the country’s Gross Domestic Product (GDP), according to official statistics from the National Bureau of Statistic (NBS).
The incomes then were derived from the export of major cash crops such as rubber, cocoa, palm oil, cashew nuts, groundnut and cotton, among others.
Notwithstanding the low prices that agricultural products suffered at that time, the sector remained resolute as it continually sustained the country’s economy. Indeed, the sector was the largest employer of labour in the country then.
However, on assuming office as the Head of State in 2015, President Muhammadu Buhari pledged to introduce diversification programme where agriculture, solid minerals and manufacturing sectors were identified to stabilise the ailing economy amid the fall in crude oil price at the international market.
Particularly, government set up the Economic Recovery and Growth Plan (ERGP) to halt the decline of the economy.
After various agric sector policies by government, Nigerian agriculture became the toast of eminent industrialists, commercial farmers, foreign and local investors and agro-allied industries as they ventured into different aspects of farming.
In 2018, agriclture is expected to still continue to play a key role by effectively contributing to government’s effort at restructuring the economy away from dependence on oil. However, the areas of agriculture expected to witness investments include rice mills, fishery, cocoa, cashew, yam export, sesame seeds export and flour mills plants. Others are farm inputs acquisition, fertilizer production plants, palm oil export, poultry, sugar plant set up and tomato production establishment.
These areas have been identified as juicy because of their high return of investment for investors vying to trade in them.
Rice milling plants
There has been paradigm change in the country’s agriculture with the intensity in the production of local rice for Nigerians.
Already, the government has set ambitious targets of becoming self-sufficient in rice production this year and turning a net exporter by 2020.
No doubt, the Anchor Borrowers Programme of the Central Bank of Nigeria (CBN) has opened up potential opportunities in the country’s sector.
With this programme, there has been massive production of local rice in large scale to stop importation of foreign rice both at land borders and ports.
However, the self-sufficiency programme in rice production has seen the springing up of rice mills plants in the country in line with the government’s diversification agenda to make agriculture the hub for investors.
Already, Africa’s richest man, Aliko Dangote announced early last year that he was making a $1 billion investment in Nigeria’s rice production.
Other big players have also jumped in, including the Lagos-based conglomerate TGI, which opened a rice mill last August with a capacity of 120,000 tonnes; Olam Nigeria, part of Singapore-based Olam International, which plans to boost its existing rice output; Amarawa rice mill’s 288 metric tonnes rice per day capacity in Kano State; the multi-billion Naira Wacot Rice Mill in Argungu, Kebbi State and many others. So more investments in rice mills are expected from investors this year.
Floating of tomato plants
This is another juicy area that agric sector stakeholders have predicted would witness boom this year. This move may be attributed to the Federal Government’s plan to ban the importation of foreign tomato paste into the country and enhance the production of local tomato paste in circulation.
In order to justify its commitment, the Federal Government announced new policy on importation of tomato that would further stimulated the establishment of new and emerging processing plants as well as the resuscitation of some hitherto comatose tomato concentrating plants in the country.
The quest for this move is to reduce the country’s N6 billion currently spent annually in foreign exchange on tomato imports and also the average 150 metric tons annual imports on tomato paste.
Already, the private public partnership (PPP) committee set up by the Federal Government on the new tomato policy is yielding positive results, especially on the implementation of curbing imports of concentrated tomato into the country.
Besides, the revamping of the abandoned local tomato processing plants and the new ones that are springing up has been identified as catalyst towards achieving sustainable self-sufficiency in tomato production locally.
Stakeholders and government have admitted that influx of tomato paste into the country due to lack of regulatory policy in the sector brought about circulation of sub-standard tomato paste across the country.
Big players in tomato industry such as Dangote Tomato Processing Company Kano and Erico Foods Limited as well as Savannah tomato industries should expect more competition from new investors this year.
Floating of fertilizer plant
Recently, the Federal Government commenced the revival of some ailing blending fertilizer plants in a bid to rejuvenate the country’s agricultural outputs by making fertilizer accessible and affordable to farmers in the country.
Particularly, the government, through the Nigeria Sovereign Investment Authority (NSIA) refurbished 12 out of the 28 existing fertilizer blending plants scattered across the country while additional six blending plants have been scheduled for refurbishment this year.
This move indicates that Nigeria now has the capacity to blend and produce fertilizer locally.
The intervention programme in the country’s fertilizer sector by the government has seen the prices of fertilizer being slashed further in order to make the product available and affordable for small holder farmers.
However, stakeholders believed that ongoing federal government’s effort in the fertilizer industry would see further influx of investors in the sector this year.
Indeed, fertilizer is one of the major agricultural inputs, which farmers depend on for increasing their yields to boost food productivity and security.
At the formal flagged-off of Nigeria’s packaged 72 ton of yam export to United Kingdom at Lilypond Container Terminal, Ijora, Lagos, last year, the Federal Government revealed that Nigeria intends to realise at least $10 billion annually in the next four years from yam exports to Europe and United Kingdom.
The move to commence yam export was in line with the implementation of the Agricultural Promotion Policy (APP)-The Green Alternative lunched last year by the Presidency.
Already, the Federal Government intend to take yam production, processing and marketing in Nigeria to the next level this year.
With this, it has opened doors for potential local exporters of agricultural produce willing to join in the export of yam outside the country.
Statistically, Nigeria is by far the world’s largest producer of yam, accounting for 61.7 per cent, according to the Food and Agriculture Organisation’s statistics of the world’s production annually and with over 60 yam varieties produced across the states of the federation.
However, there is high expectation of influx of investors into yam export business this year.
In fulfillment of Nigerian Sugar Master Plan (NSMP) implementation, the Federal Government revealed that Nigeria’s local sugar production is expected to hit 1.7 million tons by 2023, from its current 30,000 tonnes.
No doubt, the sugar industry is a very lucrative business in Nigeria. But the importation of foreign sugar into the country has set Nigeria’s economy back.
However, with the renewed efforts by government to give priority to local firms in production of sugar to boost local production, there is the tendency that investors would flood the country’s sugar industry this year.
No doubt, the agric sector has been proritised by the Federal Government under President Muhammadu Buhari, but stakeholders are lamenting the inconsistent policy somersaults that have continued to regard their investments.
Nigeria’s agric and the challenges
Recently, the Minister of Agriculture and Rural Development, Chief Audu Ogbeh, linked private sector investments to the growing transformation in Nigeria’s agric sector. But these investors still have to contend with myriad of challenges. TAIWO HASSAN reports
On attaining the mantle of leadership as Nigeria’s president on May 29th, Muhammadu Buhari, without compromising his administration’s role, explained that he would give top priority to the agric sector. Particularly, President Buhari wooed the private sector to invest in agriculture, saying that this is the next ‘big thing’ in the country and it is being positioned to increase the country’s revenue generation.
Since President Buhari’s clarion call, the private sector have keyed in into the Federal Government’s diversification agenda, through their investments in Nigeria’s agric sector. Ogbeh has consistently reiterated that his ministry is fully committed towards the development of the agricultural sector, stressing that key developments in the sector would continually be private sector driven.
He said that the Federal Government would provide the necessary incentives to grow the sector by facilitating financing and support for Small to Medium Scale Enterprises (SME) through investment vehicles such as FAFIN.
Fixing Nigeria’s agric sector
The minister said that the burden of fixing Nigeria’s economy has fallen squarely on his ministry as the oil industry has floundered and the revenue originating from it had taken a plunge, adding that no serious government will fold its arms and watch without doing something. According to him, to fix agriculture and the Nigerian economy, what the administration need to do is to harness the good policies it met on the table and blend with those that they are currently fashioning out, in a coherent and consistent manner such that it will instill confidence in the citizens, investors, market operators, farmers, traders and everyone along the various agricultural value chains.
He said that President Muhammadu Buhari has given his support for the interventions that could move agriculture forward and contribute to repositioning the economy and diversifying it away from overreliance on oil.Ogbeh said : “We have taken up the challenge of boosting local production of food as we reduce our dependency on food imports, boost domestic food production, revive rural economy and expand export earnings.
“With the huge agricultural potential of over 84 million hectares of land, abundant water bodies, particularly the various rivers, all-year-round favourable weather conditions and a variety of agro-ecologies suitable for agriculture, Nigeria is well positioned to feed its population as well as produce for export.
“The policies of my ministry will be proactive and responsive to the stakeholders’ peculiar needs. We will be nationalistic and patriotic in our approach. “We will support genuine investors and we will ensure that food is produced in abundance while we also boost the prospects of investors in the agricultural sector.”
Private sector investments
The increasing attention of the private investors in agriculture is a testimony to the fact that there is a lot of prospect in the sector. Particularly, the private sector investment in various agricultural value chains in Nigeria has re-positioned agriculture in the country in all ramifications. Indeed, the private sector investment has also provided an opportunity for the national agriculture community to familiarize themselves with the Federal Government’s priorities and plans for the sector.
No doubt, statistics revealed that private sector investments in the country’s agric sector has surpassed N1 trillion. Hence, agric experts have advised that the government needs to give more support to the private sector in order not to lose the goodwill the country had been enjoying in agriculture.
“There is risk of reduced investment spending that can lead to loses of opportunity for job creation by 16 priority investors due to lack of satisfaction with government support,” the UNDP Deputy Country Director of Programmes, Mandisa Mashologu said. He added that nascent system of coordination and inconsistency of policies, regulations, laws and administrative practices, which were key challenges, must become a thing of the past, if Nigeria must maintain its enviable leadership position in Africa’s agricultural transformation. Some of the multi-billion naira private sector investments in Nigeria’s agric sector are geared towards guaranteeing abundant food sufficiency and security.
Cosmas Maduka, Chairman of Coscharis Group, a foremost automobile dealer in Nigeria, has invested a fortune on rice production in Anambra State to the tune of 3,000 hectares and promised to increase it to 6,000 hectares soon.
Alhaji Sani Dangote, the vice chairman of Dangote Group, has indicated the commitment of his conglomerate in agricultural mechanisation. Dangote Group was among the investors who witnessed the flag-off of the second phase of the Mechanisation intervention of the Federal Government.
The company is among others taking up Agricultural Equipment Hiring Enterprise centres in Nigeria. Sani Dangote, who is also the chairman of the Nigeria Agriculture Business Group (NABG), said: “There is an urgent need for private sector stakeholders in agriculture to work together towards growing Nigeria’s agriculture, diversifying from oil and gas dependency, encouraging agricultural industrialization, and creating an enabling environment for agribusiness to thrive.”
On rice production, Africa’s richest man, Dangote, announced earlier this year that he was making a $1 billion investment in Nigeria’s rice production, which seemed to vindicate the government’s approach.
The Dangote Group plans to produce one million tonnes of parboiled milled rice over the next five years, equivalent to 16 per cent of domestic demand. Other big players have also jumped in, including the Lagos- based conglomerate TGI, which opened a rice mill in August with a capacity of 120,000 tonnes, and Olam Nigeria, part of Singapore-based Olam International, which plans to boost its existing rice output.
However, despite the efforts of the private sector investors to boost Nigeria’s agriculture, they are still facing challenges in their farming businesses, including access to credit, access to land, land analysis, land management and security on farms. Also included are market access, standardization and post-harvest losses. All these challenges are currently affecting their huge investments in the sector.
With the huge private sector investment in Nigeria’s agriculture, experts have called for creation of enabling environment from government in order to safeguard their investments in the sector.
Dogara’s wife assists 7, 000 women farmers in Bauchi
As part of efforts to encourage women farmers, the wife of the Speaker House of Representatives Mrs Gimbiya Yakubu Dogara has distributed farms seeding to seven thousand women farmers in Bauchi state.
Mrs. Dogara represented by the Coordinator of the Sun Of Hope Foundation Mrs Darambi Kefas explained that the organization had supported 3, 500 women farmers in the constituency last year to cultivate rice which became so scarce for some time now saying 3, 500 youths were included in this year to cultivate maize with a view to eradicating hunger in the society.
She said three thousand five hundred (3, 500) women farmers were provided with rice seeds and additional three thousand five hundred (3500) women with maize seeds saying were donated free of charge by her pet project ‘Sun Of Hope Foundation’.
The women beneficiaries were drawn from Bogoro, Tafawa Balewa and Dass Federal constituency of Bauchi State where the speaker represents.
She noted that the new beneficiaries are being selected yearly from all wards in the three local government in order to carry all constituents along.
Mrs Dogara stated that the foundation intervenes in the areas of agriculture, health, education and children’s welfare said they recently donated medical equipment and consumables to Virginal Vestibular Fistula (VVF) centres in Ningi, Bauchi State, Akwa Ibom and Hajiya Gambo Sawaba VVF centre, Zaria.
” The foundation had in the recent time sponsored free ante natals to pregnant women in Dass local government and offers free medical outreach at the annual ‘Limzaar’ festival in Tafawa Balewa local government”, She said.
Responding on behalf of other beneficiaries, Esther Bitrus expressed appreciation to the Speaker’s wife for the gesture promising that they would make good use of the seeds.
Meanwhile, Mrs Dogara also donated two bags of rice, one bag of maize and baby kits and wares to mother of triplets Mrs Rachael Gabriel at Lafiyan Sara village in the local government.
New agric laws: How far can NASS go?
Just recently, Speaker of the House of Representatives, Yakubu Dogara, called for the enactment of new legislation that can foster, guide and revolutionise agricultural activities in the country. TAIWO HASSAN juxtaposes this move with the realities on ground
Overview of Nigerian agric sector
Indeed, since the nation’s independence in 1960, agriculture had been the mainstay of Nigeria’s economy, providing the largest chunk of foreign exchange inflow into the country. Moreover, it contributed about 63 per cent to the country’s Gross Domestic Product (GDP), according to official statistics from the National Bureau of Statistic (NBS).
The incomes as at then were derived from the export of major cash crops such as rubber, cocoa, palm oil, cashew nuts, groundnut and cotton, among others. Notwithstanding the low prices that agricultural products suffered at that time, the sector remained resolute by continually sustaining the country’s economy. Indeed, the sector was the largest employer of labour in the country then.
However, on assuming office as the Head of State in 2015, President Muhammadu Buhari pledged to introduce diversification programme where agriculture, solid minerals and manufacturing sectors were identified to stabilize the moribund economy.
Particularly, the government floated the various economic policies including the Economic Recovery and Growth Plan (ERGP), in order to stem the steady decline in the country’s economic fortunes.
For agriculture, the present administration launched the Green Alternative: Agriculture Promotion Policy (2016-2020) as a roadmap towards the revival of country’s agricultural sector.
According to the government, it is a comprehensive plan and a well thought-out strategy -to meaningfully and systematically address the myriad of challenges militating against the growth of the agricultural sector, with a view to providing innovative solutions for reviving and repositioning the sector for accelerated national development.
However, the agric policy of the government became the toast of some eminent industrialists, commercial farmers, foreign/ local investors and agro-allied industries as they ventured into different aspects of farming in order to provide food sufficiency and security for Nigerian populace.
Nigerian agricultural policy
Indeed, Nigeria has a robust agricultural policy set out in the Nigerian Agricultural Policy 2000, which provides the framework for the implementation of programmes and guidelines for agricultural development. The overreaching objectives of the Policy are:
The achievement of self-sufficiency in basic food supply and attainment of food security, increased production of agricultural raw materials for industries, eradication of poverty, development of the rural economy, and protection of environment.
This is expected to be achieved through the: Creation of a conducive macro-environment to stimulate private sector investment in agriculture, rationalisation of the roles of the three tiers of government in their promotional and supportive activities to stimulate growth, articulation and implementation of integrated rural development as a priority, National programme to raise the quality of life for rural people, increased agricultural production through increased budgetary allocation and promotion of the necessary developmental, supportive and serviceoriented activities, increasing fiscal incentives and promotion of increased use of agricultural machinery and inputs through a favourable tariff regime.
The policy is successfully implemented in areas of food crops such as maize, beans, sorghum, yam, millet, cassava, pineapple, and oranges.
However, the policy is less successful and greater investment will be required in areas of cash crops such as oil palm, cocoa, rubber, groundnut, cotton, cashew and sugar cane, and food crops such as potato, rice, wheat and fruit crops. House of Reps’ new agricultural laws However, having realized that the country had ots of agricultural laws that are no longer relevant and obsolete, the House of Reps called for the enactment of new laws that will take the agricultural sector to new highs while turning it into a major foreign exchange earner for the country in the nearest future.
The Speaker of House of Representatives, Yakubu Dogara while speaking at a two-day public hearing organised by the House Committee on Agricultural Colleges and Institutions in Abuja, recently affirmed that it was time for legislating new agricultural laws for the country.
He said that there was need to ensure bills processed by the legislature were cost-sensitive and did not increase the financial burden of the nation through the multiplication of agencies.
The proliferation of agencies, according to him, is not conducive to the economic well-being of the nation as a new agency “comes with its complement of bureaucracy.”
Instead, he advocated for the amendment of the functions and mandate of existing agencies, where possible. Dogara added: “Furthermore, in cases where there is need to reinvigorate a particular sector and lay emphasis, it may become necessary to carve out an agency from an existing one.”
He reiterated that the agricultural sector requires up-to-date legislation for continuous growth and development. He said, “It is very gratifying to note that giant strides are being made in the sector.
“Up-to-date legislation is required to aid the drive to modernize agricultural practices, drive economic diversification, achieve food self-sufficiency, and ultimately turn agriculture into a major foreign exchange earner in the nearest future.”
New agric bills
The bills being considered by the committee include a Bill for an Act to Regulate the Profession of Agriculture and to make provision for the Establishment, Functions and Administration of Nigerian Institute of Agriculturists, and for Other Related Matters. (HB.838). Also under consideration, is a Bill for the Act to Repeal the Veterinary Surgeons Act. Cap. V3, Laws of the Federation of Nigeria, 2004 and for Other Related Matters (HB. 836). In his remarks, the Speaker urged the committee to ensure the bills were in accordance with legal, regulatorky and economic goals set out for the agricultural sector through appropriate scrutiny.
Agricultural experts, under the All Farmers Association of Nigeria (AFAN), are however, pessimism about the lawmakers’ stance to promulgate new agricultural laws given the lifespan of the current administration, saying the bills could be waste of national resources.
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