• Stakeholders seek FG’s support to protect trade

STAKEHOLDERS in the vegetable and edible oil industry have cried out over the infiltration of imported and smuggled oil into the country – a development that has literally paralysed the trade and pushed many local producers out of business.

To them, in the face of the current decline in food prices, food imports should function as a strategic shock absorber, rather than a permanent market feature, considering the pressures facing producers, as the imported oil is reducing the demand for locally processed brands.

They are also demanding that government should develop and publish a national crop production and harvest calendar for major staples and align import decisions with documented supply gaps, noting that import licences should be suspended during peak harvest periods to prevent farm-gate price collapse, while stakeholder consultations with farmers’ associations should precede major trade interventions.

In his keynote address at the National Press Conference on Food Security in Lagos, titled: “Balancing Food Affordability and Farmer Vulnerability: Nigeria’s Food Strategy and the Path to Sustainable Food Security,” the Convener, Dr. Fatai Afolabi, who doubles as the Managing Director, Foremost Development Services Limited, said there is an urgent need to revive and modernise price support and stabilisation programmes.

“Government can introduce guaranteed minimum prices for strategic commodities, announced ahead of planting seasons, and purchase excess produce when market prices fall below production costs. These commodities can be stored in silos and warehouses built by the government at strategic location across the states, and released during off-season periods at controlled prices.

“This approach supports farmers, protects consumers, and stabilizes food prices. Effective commodity boards, modern storage infrastructure, and transparent procurement systems will be critical to success.

“To address the root cause of farmers’ distress, production costs must be reduced. Targeted subsidies should be expanded for fertilisers, improved seeds, agrochemicals, and mechanisation services, using farmer registries, cooperatives, and other e-platforms to ensure transparency.

“Import duties on essential inputs not produced locally should be reduced, while domestic input production should be strengthened. Affordable energy solutions, including solar-powered irrigation and processing systems, should be promoted in farming communities,” he said.

Afolabi noted that while output prices have fallen, the cost of producing food in Nigeria remains stubbornly high, as farmers continue to contend with expensive fertilisers, high fuel prices, rising transportation costs, costly improved seeds and agrochemicals, limited access to affordable credit, poor and epileptic electricity supply, poor road infrastructure, and weak storage and processing infrastructure that leads to significant post-harvest losses.

“This scenario, where farmers sell produce at declining prices while production costs remain elevated, has created widespread distress across agricultural ecosystems.

The effects are being felt across all segments of agriculture.
“Tree crop farmers are not insulated from these shocks. Vegetable and edible oil producers are under pressure as imported vegetable oil brands reduce demand for locally processed brands.

Cocoa farmers continue to battle price volatility in international markets while shouldering rising domestic costs of labor and farm maintenance. Because tree crops like oil palm and cocoa are crops of long gestation periods, they thus require long-term investment and patience. Sudden market disruptions are especially damaging, undermining investor confidence and discouraging new investment.

“Downstream, the effects extend to agro-processing and value addition. Soybean farmers supplying processors for vegetable oil production are experiencing reduced demand and lower prices. Small- and medium-scale processors are squeezed between cheaper imports and the high cost of energy, packaging, and logistics. This threatens not only farm incomes but also rural employment and agro-industrial development,” he said.

In his submission, the Chairman, Plantation Owners Forum of Nigeria (POFON), Mr. Emmanuel Ibru, said the industry and other value chains have been hard hit by series of challenges that has increased their cost of production, noting that the proliferation of vegetable oil into the country has worsened the woes of the processors.

“Around the 1970s to 1990s, the palm oil industry was almost in comatose, but with the turnaround in the industry few years back, a lot of firms have come into the industry but this issue of importation is spoiling the business for them and making jobs of their employees to be at stake.

“If government is pushing down cost of food, it shouldn’t affect the producers. It shouldn’t be the farmers that should bear the brunt.”
On his part, the President, National Palm Produce Association of Nigeria (NPPAN), Ambassador Alphonsus Inyang, said the industry is trading at a price that is 50 per cent less than what it was two months ago.

Said he: “Palm oil is currently sold lesser than the production price. This is affecting the producers, especially smallholder farmers who depend on this to pay their children’s school fees, feeding and others. The land and sea borders are our major problem, with multitude of entries point for palm oil.

“The Federal Government is losing revenue, while farmers are being repressed by these oils coming from other countries that are very cheap. Government needs to do more, by assisting primary producers of oil. Government needs to look at the sector critically, learn from the story of Indonesia and Malaysia. They need to look at the industry as an economy.”

Inyang revealed that creating a N20 trillion economy through the palm oil sector is achievable in Nigeria, if government can provide access to quality planting materials and use palm oil to fight poverty.

The Chairman, Vegetable Oil Sub-Sector, Manufacturers Association of Nigeria (MAN), Mallam Mohammed Tahir, queried why the Federal Government policies on importation of commodities are not enforced.

“Government should have a rethink on the policies. Let’s look at countries like China, India, Indonesia, Brazil and others, what policies are they adopting to project their local industries. Government should be encouraged enough to see how they can help local investors.

“If there are policies on ground, who are the people to enforce them? Government needs to protect industries on ground, paving way for new ones and learn from other countries that are excelling,” he said.

In his contribution, the President, Soyabean Association of Nigeria, Dr Christopher Ayodele Uwala, said part of the problem is the “drive by the American government to export anything into Nigeria, like the Genetically Modified Organism (GMO) oil, which is not only cheaper but has side effects like infertility and others.

“Two years ago, the price of soybean was high but now it has dropped to a quarter of the initial price. This is seriously affecting farmers and the entire industry, as the stakeholders are running into debt.”