Managing Director, Ellah Lakes Plc., Chuka Mordi, has noted that despite Nigeria’s agro-industrial sector holding immense potential, it continues to battle significant structural challenges that limit its capacity to transform the nation’s agricultural wealth into processed goods.
Speaking on the opportunities and obstacles in the nation’s agribusiness landscape, Mordi painted a picture of an industry constrained by high interest rates, inadequate infrastructure and policy uncertainty. At the heart of Nigeria’s agro-industrial challenges, he said, lies the fundamental problem of access to capital. With inflation hovering above 23 per cent, he explained that lending to the agricultural sector has become prohibitively expensive for both banks and borrowers.
He said the situation is reflected in broader statistics; less than five per cent of bank credit goes to the agricultural sector due to perceived high risk, despite agriculture’s significant contribution to Nigeria’s GDP. Government intervention programmes, such as the anchor borrower scheme and Central Bank lending initiatives, have provided some relief, but remain critically inadequate for industrial-scale agricultural processing.
Nigeria’s inability to add substantial value to its agricultural produce remains a persistent concern. Despite being the world’s largest cassava producer, accounting for 20 per cent of global production and having substantial livestock populations, the country’s agro-processing capacity lags far behind its raw production capabilities.
Touching on the slow progress in value addition, he drew a parallel with Nigeria’s petroleum sector. He further identified several interconnected factors hampering agro-industrial processing, including poor access to finance, inadequate human capacity, insufficient technology transfer and knowledge gaps.
He stressed that achieving meaningful value addition requires substantial investment in education and skills development. Nigeria’s infrastructure deficit continues to exact a toll on agricultural productivity. Post-harvest losses, estimated at around 50 per cent in recent assessments, remain high due to inadequate cold storage facilities and poor road networks. The capital-intensive nature of cold storage and logistics infrastructure, combined with high borrowing costs, he said, makes it difficult to attract investment in these critical support systems despite clear business opportunities.
While technology offers solutions to some agricultural challenges, Mordi cautioned against viewing it as a panacea. “Technology is an enabler for agribusiness, but you have to do the farming properly in the first place for technology to be an enabler in what you’re doing,” he stated.
Insecurity has imposed additional costs on agro-industrial operations, forcing companies to invest heavily in private security for farms and engage police protection. Declining to quantify specific losses, he acknowledged that security expenses represent a significant burden that could be eliminated with improved public safety.
He also stressed that policy inconsistency remains a challenge. “With every new government, there’s a new master plan in agriculture, in gas, in livestock. This is a problem that the private sector faces in terms of what the government is doing from a policy perspective,” he decried. He emphasised that the government’s primary responsibility should be to create a stable macroeconomic environment for businesses to thrive.
As Nigeria grapples with a projected 33.1 million people facing acute food insecurity in 2025, while agricultural imports valued at $6.6 billion far exceed exports of $2.3 billion, the need for robust agro-industrial capacity has never been more urgent.
