The Minister of Agriculture and Rural Development, Chief Audu Ogbeh, speaks on a broad range of issues in the sector affecting the Nigerian economy in this interview with Okechukwu Nnodim
There is apprehension of looming famine in Nigeria. What is the government doing about this?
We want to put it quite clearly that there is no danger of famine in the country, absolutely not. The government will not allow that to happen. We are already taking steps to make sure that Nigerians don’t go through any such harrowing experience. There has been some panic over the massive purchase of grains from many of the big grain producing fields in some parts of the country. This fear was highlighted by Emirs and chiefs in the North, who met with us last week and raised the same anxiety. It is true that for the first time in our history, we are witnessing the extraordinary purchase of our grains into the West, North and Central Africa. We are even getting demands from as far as Namibia; they are asking for grains in large quantities of up to 37,000 tons of maize.
Don’t you see this as an issue capable of posing serious challenge in the sector?
This is a challenge which is good. It is good because it now proves that Nigerian farmers have a market for their produce and are making money more than they had ever made before. And they are saying this with their own mouths to us that they are getting richer. So it is a good thing, even though the demand by our neighbours is putting pressure on local supply. We are still aware and confident that this is the market economy and we will not interfere with the trading. But we are putting in place sufficient mechanism to store enough in our silos. So there is no reason for us to panic. We have 33 silos sites across the country with a total capacity of nearly 2.5 million tons of grains. And we are buying at a time when it is better to buy because the grains will be allowed to dry reasonably well to a moisture level of only 13 per cent. If you store at higher moisture level, the grains would go bad in the bags which you pack them because they will develop moulds. And the mould produces aflatoxins, which is unhealthy.
So this is the best time to buy. I know people have bought and stored up, hoping that prices will hit the sky and they will make profits but we are buying and so Nigerians have no reason to panic. We are buying in the same market where buyers from other countries buy from. The good thing is that those who buy for the government know what to do and they go in there to buy just like everybody else. We met with some of the traditional rulers who also expressed anxiety. But once we enter the market, we have ways of getting to the sellers who are our farmers before the foreigners can get to them.
Aside buying and storing in warehouses or silos, are you working with state governments in order to sustain food security across the country?
We have made arrangements with some governors to go back again and start planting even before Christmas. They are planting millet, maize and sorghum so that we can have a second crop season by March and April next year. This is the method we are applying now instead of waiting for the rainy season alone to support our grain production and our agriculture generally. Food has to be produced all-year round through irrigation. This also leads us to a new programme we are putting in place for the construction of dams and lakes throughout the country in the next two years so that there is water. And this will ensure that whoever wants to grow anything can do so. Usually, irrigated farming is superior to farming that is reliant on rainfall because you can control the water in-take and the crop does better than when there is excessive water. So all of that is part of the scheme we are putting in place. Also, we have had some support from the Arab Bank for Economic Development in Africa, as it has sponsored (the construction of) small lakes and dams. In Oyo, Ogun, Kaduna and some other states, we have about 22 dams. From next year, we are hoping that we may get some help from other agencies.
The prices of grains in Nigeria have been on the high side for a prolonged period. Is the government really concerned about this?
Government is concerned about the prices of food. Government is aware that families have very low income and that food items still cost quite a bit, but the answer is not to stop market forces from playing out. We are sure that in another year or two, the production will be big enough and the market will stabilise and wealth will begin to grow from the very foundation of our societies, namely the rural areas. And all of you will feel the effect. At the very least, people will stop calling you to send them money as they do all the time. You are in Abuja and so they think that you have access to cash. We are aware of it and that pressure is always there. But once the villagers begin to earn more money, they will make you know it because they are selling a lot of food now and we have to help them produce. So please inform Nigerians that there is no reason to panic, government is not asleep, we are taking steps to make sure that we have surplus and enough to sell before the next two harvests.
Are you considering the reestablishment of commodity boards in a bid to manage the prices of agricultural produce, particular grains?
Commodity boards were in place many years ago and they were abolished. Then, three commodity companies were set up, but somehow they didn’t work. The debate now is: should we go back to commodity boards or not? We are thinking about this and soon we may have to hold a public hearing on this matter within the ministry. Some people said that it was abused in the past, while some others said that the system worked very well because it did quality control and educated farmers on how to dry and bag. The views are very strong on either side and we intend to analyse them to see what’s best. However, it is necessary to have a minimum guaranteed price for our crops. Now, we are not going there yet until our production reaches the next level. Because if you do so and there is a glut, then government has to subsidise. However, a minimum price needs to be guaranteed.
Right now, we are planning to meet with the rice farmers and rice millers to make sure that they make a reasonable income to keep them in business, but the millers don’t buy at such a price that will make the end product so expensive for you and I to buy. This is because we have a duty to protect the Nigerian consumer. So if there is a balance between the farm gate price and the table price, then everybody is happy. But it will take some calculations to arrive at that price. The only rate that people are talking about is the commodity rate of exchange, which again is being worked at. For you can now use your commodity in the warehouse to take a loan, it is of lower standard here. The commercial banks are still not very comfortable with that; but they will be when the yields are high and they begin to see farmers demonstrate the capacity to repay. So give us a bit of time, maybe early next year, we will come up with the framework.
There are also complaints that the price of fertiliser has increased beyond the reach of many local farmers. Are you aware of this?
The prices are high because the demand is high. Fertiliser prices went up last year or early this year because we had a problem with security. We couldn’t move fertiliser to the North because Boko Haram was reportedly using urea to make bombs, so we had to lock down the movement for a while. So, at the time this was done, a bag of fertiliser went up to about N8,000 to N10,000. The good news, however, is that we have just signed an agreement with Morocco and based on this; we are going to buy phosphate from there worth a million tons. We are going to buy potassium from another source close to Morocco because Morocco is the largest single deposit owner of potassium among all countries of the world. With the arrangements being made with the private sector, there is no reason why a bag of fertiliser should sell for more than N5,500 if transportation doesn’t become a problem. I say this because if a trailer with 30 tons of fertiliser moves from Lagos up North, it will cost between N350,000 and N400,000.
Also, if the railways begin to roll, that will be a further advantage. So these are the infrastructural issues which we are trying to battle with and once we deal with them, there should be fertiliser all-year-round. Except if the Nigerian factor comes in, where somebody may decide to smuggle fertiliser across the border to some other places. Right now, we are trying to blend fertiliser for specific crops and soils as we do more soil tests.
With respect to government’s plan of making Nigeria self sufficient in rice production, what further steps are you taking to stop foreign rice inflow into the country?
The Economic Community of West African States’ treaty has all kinds of publications like free trade in between countries and that is something weighty. The Senate had raised that issue in the past. Senator Hope Uzodinma’s committee raised an issue which I sympathise with very strongly. What it said is that goods produced within the region should have free movement. But some of our neighbours are not moving goods produced, rather they import goods, station themselves around our borders and then smuggle them into our economy. For instance, the Republic of Benin doesn’t eat parboiled rice. They eat white rice. But all the rice coming through the borders in Nigeria are parboiled. I have a list now of all the ships that left Thailand in the last seven weeks and they’ve arrived. There are 571,000 tons of rice waiting to enter Nigeria for Christmas but we won’t allow it. So when Senator Uzodinma raised that issue in the Senate, he was saying that we needed to review the treaty because we were at the losing end.
In fact, why are we allowing this when the rice is not grown in the Republic of Benin? They bring tomato paste and chicken that are not produced in the Republic of Benin and because the Nigerian market is so huge they want to exploit it. I sympathise and fully endorse the views of the Hope Uzodinma-led committee of the Senate to do something about this. No economy, out of sympathy, should damage our own and out of sentiments, we should not allow anybody to do things to us which we can’t do to them. When Aliko Dangote (Nigerian businessman) was trying to ship his cement through the Republic of Benin to Togo, it took him one year to persuade them to allow him to do that.
The Central Bank of Nigeria recently said Nigeria will start exporting rice from next year. Can Nigeria do that and what are the measures on ground to make this a reality?
Yes we can. We have just brought in 110 rice mills of different capacities. Some have 100 tons capacity; others 50, 40, 20 and 10 tons capacities, respectively and we are going to give them to cooperative societies and rice dealers across the country to enhance their milling capacities. We have another 12 to come in later, maybe next year, so that the milling capacity will be enhanced and we will also begin to export white rice to other countries in West Africa.
What is the government doing about revamping cocoa production and export, as well as pulses?
For cocoa, we had to shift it (our programme) because we were going to launch it in Ondo State, but there was electioneering and we don’t like to mix economic programmes with politics. If you do that, you’ll create problems. As far as we are concerned, the country is one despite the different political parties. So once election issues are cleared, we are moving in. We shifted it and we are vigilant. For pulses, the Indian High Commission has brought in its agronomist based on our request. So when we grow what we are growing and export to them, we won’t hear stories that it doesn’t meet their standard or their quality. This process has taken a little longer than usual. But we have been invited to India to see a few things being done there. Luckily, pulses take a short time to mature and it is a big market of $100bn and we intend to partake in it by organising our farmers.