The Centre for the Promotion of Private Enterprise (CPPE) has called on the Federal and State Governments, commodity exchanges, development finance institutions, and private investors to work collaboratively in establishing a Farm Price Stabilisation and Farmer Income Protection Framework that is rules-based, transparent, fiscally sustainable, and supportive of private enterprise.

The Chief Executive Officer of CPPE, Dr Muda Yusuf, who disclosed this in his recent policy brief on sustainable food security, said a stable agricultural market will not only protect farmers; it will strengthen food security, reduce inflationary pressures, expand rural employment, and improve Nigeria’s national economic resilience.

Titled: Imperative of Farm Price Stabilisation and Farmer Income Protection Framework for Nigeria, Dr. Yusuf said there is an urgent need to strike a sustainable balance between two critical national objectives – keeping food affordable for consumers, while protecting farmers’ incomes and safeguarding investment in agriculture.

“This development presents a major policy dilemma that demands urgent attention. Nigeria cannot afford a policy regime that undermines confidence and discourages investment in agriculture—one of the most strategic sectors of the economy, a major source of livelihoods, and one of the country’s largest employers of labour.

“There is therefore an urgent need for policy recalibration and rebalancing to ensure that farmers remain productively engaged, rural incomes are protected, and investor confidence across the agricultural value chain is sustained—without compromising the equally important objective of keeping food affordable for Nigerian households,” he said.

He noted that recent import surges of food crops—especially staples such as rice, maize and soybeans—have caused serious dislocations in the agricultural investment ecosystem, which has inflicted severe hardship on farmers, weakened incentives to produce, and undermined Nigeria’s broader food security objectives.

Dr Yusuf hinted that though consumers have welcomed the decline in food prices, the long-term consequences are adverse: farmer incomes fall, production declines over time, investment confidence weakens, and the country risks returning to cycles of scarcity and higher prices.

“The Centre for the Promotion of Private Enterprise (CPPE) is of the firm view that Nigeria urgently requires a clear, rules-based and market-friendly Farm Price Stabilisation and Farmer Income Protection Framework.

“Such a framework should prevent import-induced price crashes, reduce harvest-time price collapse, discourage distress sales, protect farmer livelihoods, strengthen value chains, and provide stable supply conditions for processors and consumers. There is a need for a coherent programme grounded in global best practices and adapted to Nigeria’s fiscal and governance realities.”

He stressed that the development has produced troubling trade-offs and unintended consequences, adding that while consumers have applauded the sharp decline in food prices and the notable moderation in food inflation, investors and producers in the agricultural sector are lamenting heavy losses arising from the collapse in prices of key commodities.

“The welfare gains from cheaper food have been profound and should be acknowledged. However, the cost to farmers and other investors across the agricultural value chain is equally significant and cannot be ignored.

“The immediate factor driving the collapse of farm product prices in Nigeria has been the surge in imports of grains, adopted as an emergency response to extremely high food prices experienced nationwide. However, beyond the import factor, there are structural and seasonal conditions that recur annually and worsen price instability.

“First, harvest glut remains a major challenge. Many farmers harvest the same crops within the same period, causing sudden oversupply. Second, the limited availability of storage facilities, drying centres and cold-chain systems forces farmers to sell immediately regardless of market conditions.

“Third, weak rural logistics—poor roads, insecurity, high transport costs, and limited aggregation hubs—makes it difficult to move produce efficiently from production zones to high-demand markets. In addition, Nigeria’s agricultural markets suffer from inadequate processing capacity. When surplus produce cannot be absorbed by processors, raw commodities flood open markets, leading to sharp price declines.”