Farmers count losses as naira swap policy crisis deepens

As the current naira redesign policy is negatively impacting all sectors of the economy; farmers have began to count their losses, estimated to be in the region of several millions of naira.

The Chief Executive Officer of Green Sahara Farms, Jos, Plateau State, Suleiman Dikwa, told The Guardian that the estimated loss at the local level, taking the average market revenue per market in the northeast runs into about N400m for Potiskum, Yobe State grain markets – markets for beans, maize and millet.

Initially, prices of the commodities dropped due to lack of cash, but in the last two weeks two modal prices occurred. It was learnt that the introduction of cash transfer did not help either, as the development further distorted the market because the real price is not reflected.

In Kebbi State, investigations showed that the farmers were forced to crash the prices of foodstuffs and other perishable items to as low as 30 per cent, to avoid total loss.

At the Bayankara perishable market and Makera central market, a basket of tomato previously sold for N15, 000 and above, currently sells for N3, 000. A module of maize sold for N500 and above, now sells for N200.

It was further learnt that the price of beans has reduced to N300 from N1, 000, even the price of maize and other essential food items have also crashed compared to weeks ago.

One of the traders, Alhaji Muhammadu Gwadangwaji, who lamented the poor sales recorded so far, said they are forced to crash the price, in order not to run at a total loss and also to get money to restock.

In Bauchi, report has it that the development has negatively impacted the Kasuwar Shanu market, a popular cattle market, as traders have been exposed to hardship.

It was learnt that due to traders’ fear of losing money via electronic transfer payment, which they rejected, the trend resulted to crash in cattle prices in markets across the state.

Reacting to the development, Dikwa, said in all the local markets, few Point of Sales (POS) terminals and cash are the major means of exchange.

“Initially, prices of commodities dropped due to lack of cash, but in the last two weeks, two modal prices occurred. For instance, if a bag of beans is N16, 000 per bag, cash transfer of N20, 000 will be made. This has further distorted the market because the real price is not reflected.

“This affected our ability to do business and distortion. Prices have affected standing orders moreso with rising cost of transportation. We now have transfer prices and POS prices.”

Dikwa added that at the top end of corporate players, the major loss was due to price distortions, saying the big players can hold stock, while the major negative impact is at market and farm gate in rural areas who were forced to sell to survive and can be estimated at a billion dollars using the annual Agro Products Output as a basis for estimation.

The President of the National Palm Oil Produce Association of Nigeria (NPPAN), Alphonsus Inyang, described the development as a huge problem for farmers, who are being forced to sell at ridiculous prices.

“Three weeks ago, a 20-litre gallon of palm oil sold for between N28, 000 to N30, 000. Currently, the same size has dropped to between N11, 000 to N14, 000 and farmers are begging people to buy.

“It has become a huge problem for us and we don’t know how long it will last. Oil palm farmers are losing money, likewise others because these farmers are processing at a smallholding level. They take to the market to exchange for food items – for garri, for rice, for beverages, for house rent, for school fees and other things and they must not go back home with the palm oil, they have to sell them. So, they are forced to sell at ridiculous prices as determined by
market forces.

“Before now, we were trying to see how to improve the industry because we are about to enter our season’s peak period, but this naira redesign policy has done more harm than good for farmers.”