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Wheat: Dealing with shortages as Russia/Ukraine conflict raises cost

By Femi Ibirogba, Head, Agro-Economy
18 March 2022   |   3:18 am
Russia's status as the largest exporter of wheat in the world is causing disquiet in many countries following its military incursion into Ukraine...

Country expects 400,000 tonnes by April, says wheat specialist Olabanji
• Nigeria to meet 70 per cent need in five years if efforts are sustained
• Has the potential to produce enough wheat, farmers say

Russia’s status as the largest exporter of wheat in the world is causing disquiet in many countries following its military incursion into Ukraine.

Currently, wheat is one of the most consumed grains in the world. It is also used for the production of noodles, pasta, cakes and other confectioneries.

Recent reports suggest that the conflict has already driven food prices across the globe, the Food Agricultural Organisation (FAO) warned last Friday.

Participants examining a CBN/FMAN wheat demonstration plot in Jega, Kebbi State, recently.


The agency said poorer countries in northern Africa, Asia and the Middle East that depend heavily on wheat imports risk suffering significant food insecurity.

Wheat farm

According to the trade data provided by the Observatory of Economic Complexity (OEC), the world traded $44.1 billion worth of wheat in 2019, representing 0.24 per cent of the global trade.

The data further showed that Russia exported $8.14 billion worth of wheat and thus emerged as the largest wheat exporter in 2019.

The United States exported $6.94 billion worth of wheat, while Canada exported $5.97 billion worth of wheat to occupy the second and third positions respectively. And France with $4.54 billion in wheat exports, and Ukraine with $3.11 billion, completed the list of the top five wheat exporters across the world in 2019.

According to the data, 31.3 per cent of the wheat used in Egypt in 2019 came from Russia. Same year, Turkey met 17 per cent of its wheat needs from Russia, while Bangladesh and Nigeria sourced 6.4 per cent and 4.8 per cent of their wheat imports from Russia.

Other African countries that imported wheat from Russia in 2019 were Sudan, 2.5 per cent, Kenya and Tanzania, 1.3 per cent respectively.

The top five importers of wheat in that year were Egypt, $4.67 billion; Indonesia, $2.31 billion; Turkey, $2.15 billion; Italy, $1.69 billion, and the Philippines, $1.63 billion.

The trade data showed that Egypt, Turkey, Bangladesh and Nigeria were the top destinations of Russia’s wheat in 2019, and the trend has not changed.

Also, Egypt led other African countries that imported the most wheat from Ukraine in 2019, as wheat sourced from Ukraine accounted for 22 per cent of the wheat used in that country. Tunisia and Morocco met 6.3 per cent and 5.7 per cent of their wheat imports from Ukraine.

In 2019, N349 billion worth of wheat was imported into the country. In 2020, Nigeria’s total wheat imports amounted to N756.9 billion of which N186 billion was sourced from the United States; N144 billion from Russia; N132.3 billion from Canada; N110.6 billion from Lithuania, and N101.9 billion from Latvia.

According to Nigeria’s data agency, the National Bureau of Statistics (NBS), Nigeria imported N898.2 billion worth of wheat in nine months that ended September 2021.

The top origins of wheat in Nigeria in 2021 included the USA, N194.2 billion; Canada, N136.4 billion, Russia, N124 billion, Lithuania, N122.3 billion and Latvia, N115.9 billion.

With the Russia/Ukraine conflict’s intensity and duration uncertain, “the likely disruptions to agricultural activities of these two major exporters of staple commodities could seriously escalate food insecurity globally when international food and input prices are already high and vulnerable,” said Qu Dongyu, director-general of the Rome-based FAO.

It was gathered that the price of a bushel of wheat has risen by 5.7 per cent to $9.347 following the escalation of the conflict.

In the statement, Qu said it was not clear if Ukraine’s farmers will be able to harvest wheat ready for the market in June. In Ukraine, “massive population displacement has reduced the number of agricultural labourers and workers. Accessing agricultural fields would be difficult,” he stated.

Based on the 2021 grain production data released by the Foreign Affairs Service of the United States Department of Agriculture, Nigeria’s wheat production increased to 99,000 metric tonnes (MT) from 55,000 MT recorded in 2020. This led to an 8.9 per cent decrease in importation as Nigeria imported about 6.0 million MTs in 2021, from the 6.6 million MT imported in 2020.

State of wheat production in Nigeria
ACCORDING to the Wheat Farmers’ Association of Nigeria (WFAN), the country spends over $4.2 billion yearly on the importation of wheat to meet local demand of over 5.0 million MTs, yet the country is blessed with both human and material resources to meet the demand and export.

Wheat is used in flour milling industry; bread and other confectionaries take more than 80 per cent of total flour produced in Nigeria.

During the fourth yearly Nigerian Food Processors and Nutrition Leadership Forum in Lagos last week, Chief Executive, Dangote Industries, Alhaji Aliko Dangote, and Chief Executive Officer, Flour Mills of Nigeria Plc, Mr Boye Olusanya, raised the alarm that the war between Russia and Ukraine would affect wheat importation, and in three months, might cause serious food crisis in the country.

This followed a warning earlier issued by analysts at Proshare.ng, in a recently published review of the wheat value chain, where they explained that due to the disruption to vital supply chains as a result of several COVID-19 curtailment policies, securing food for the average Nigerian was becoming tougher.

The report stated that the current price hike in the global wheat market constitutes an operational strain that is heavily impacting the cost of production of millers and has the potential to further elevate wheat-based staples prices.

The flour milling industry plays a significant role in providing Nigeria’s ever-growing population access to relatively cheaper staples, with recent industry reports showing that 45 per cent of the food variants served in Nigerian homes are wheat derivatives, and account for 75 million of the daily food portions in
Nigerian households.

How Russia-Ukraine war will impact price?
SPEAKING on how the war could affect food availability in Nigeria, Flour Mills of Nigeria CEO Olusanya noted that the price of wheat had started to increase.

He said: “We need to discuss with the government the measures to take to handle the impending crisis. The impact will also affect maize as Ukraine is the largest producer; we need to start looking at the issue of cross border trafficking of maize, as more farmers will be moving maize out of the country.”

Dangote, on his part, urged the Federal Government to place an embargo on the export of maize to ensure food security in the country as the ongoing war would lead to scarcity of food, arising from the inability to access fertiliser because the region of conflict produces about 13 per cent of urea, 26 per cent of potash, and one of the largest producers of phosphate globally. Hence, wheat would become costlier, while limited access to fertiliser would impede local production of cereals.

Efforts to increase wheat production
EFFORTS to boost wheat production locally, however, received a boost as the Central Bank of Nigeria (CBN) intervened in 2021 by importing heat-tolerant, early-maturing and high-yielding varieties, and also partnered with the Flour and Milling Association of Nigeria (FMAN) as well as farmers in off-taking arrangements, seed multiplication and commitment to growing local capacity of production through backward integration.

A former Executive Director, the Lake Chad Research Institute and Coordinator, Monitoring and Evaluation, CBN Anchor Borrower Programme on Wheat Production, Dr. Oluwashina Gbenga Olabanji, disclosed to The Guardian that CBN imported 13,000 MT of quality heat-tolerant wheat seeds and 150,000 hectares are currently being cultivated in 16 states of the country, including Kaduna and Oyo States.

Of the 150,000 hectares, 100,000 are for wheat grains production, while 50,000 hectares are meant to multiply the seeds to about 250,000 tonnes needed for cultivation in the 2022/2023 planting season.

Wheat grains harvest expected by the middle of April this year hovers around 400,000 MT, the largest ever produced in Nigeria, according to Dr Olabanji.

The wheat specialist is optimistic that in five years, the country would be able to meet no less than 70 per cent of yearly demand if current efforts are sustained.

He, however, warned against policy reversal or politicisation of agricultural policy.

Substitutes for wheat – cassava flour, potato puree
THE efforts of the Federal Government, especially as driven by former Minister of Agriculture, Dr Adesina Akinwumi, based on research experiments by the Federal Institute of Industrial Research Oshodi (FIIRO), Lagos, to use cassava flour in baking bread and other confectionaries, met a brick wall in the House of Representatives in 2011, as a bill seeking to make it mandatory in the production of all flour products in Nigeria was rejected.

Entitled ‘A Bill for an Act to Provide for the Mandatory Inclusion of Cassava in the Production of All Flour in Nigeria and for Other Matters Connected Therewith,’ the bill failed to pass second reading in the House.

The executive bill had proposed that it was incumbent on the National Assembly to enact a law, which would make its inclusion in all flours compulsory, as it would be in line with the President Jonathan-led government initiative on cassava.

Reasons adduced against the bill was that forcing manufacturers of flour to include cassava would amount to compelling Nigerians to eat products likely to be injurious to their health by virtue of some reports that about 30-40 per cent of Nigerians were diabetic, saying it would be unfair to compel them to eat cassava products since most diabetic patients are discouraged from consuming foods such as cassava.

Whereas, on July 11, 2012, the Federal Executive Council (FEC) approved new fiscal policies, including the establishment of the Cassava Bread Development Fund aimed at promoting the consumption of cassava bread. The efforts have yielded little or no result on the inclusion and prices of flour-based staples.

MEANWHILE, the National Secretary, Association of Master Bakers and Caterers of Nigeria, Jude Okafor, affirmed, while speaking on latest developments and the decision to adopt Orange-Fleshed Sweet Potato (OFSP) puree in bread baking, that at 20 per cent inclusion, the colour, texture and taste of bread are very good.

Apart from health benefits to consumers, he added, the substitution would help bakers to marginally reduce the cost of production per loaf in the latest analysis based on current prices of inputs and their substitutes.

‘‘Application of OFSP puree in wheat flour for bread reduces the usage of milk, sugar and wheat flour.

‘’On every 50kg bag of wheat flour, 1.5kgs of sugar is saved, 10kgs of wheat flour is substituted with the puree and N180 is saved on every kilogramme substituted. So, using 10kgs of OFSP puree with 40kgs of wheat flour reduces the cost of production by N1800, apart from reduction in the quantity of sugar used,’’ Okafor explained.

This move, too, has not had any significant impact on the demand for wheat flour and prices of bread and other confectioneries.

Suggestions from farmers, researchers
THE National President, Wheat Farmers Association of Nigeria (WFAN), Salim Muhammad, in the latest interview with The Guardian, advocated that the government should increase massive food production by expanding land and scope of participation.

According to him, the government should also increase its finance to the sector so that Nigeria could produce at least 50 per cent of the yearly demand for wheat.

Muhammad said: “Nigeria has to take advantage of this crisis and double the production. We have the potential because we have the land and human resources.”

Again, the National Director, Nigeria and Regional Coordinator, Africa Rice Centre, Dr Francis Nwilene, advised Nigeria to look inward and think how far it could expand the production of wheat and rice, two critical and economic grains.

“We cannot continue to depend on somebody else, even now that there is a ban on the export of food from their countries. Nothing must go out because they have to feed their populations. So, it calls now for Nigerian farmers to do more,” Dr Nwilene said.

Ways forward from wheat specialist’s perspective
WHEAT and rice consumption in Nigeria is bound to increase due to the growing population, especially in urban cities, from their current import levels. That was the submission of Dr Oluwasina Olabanji, former boss of the Lake Chad Richard Institute, Borno State while talking on ‘Impact of Science and Technology on Agriculture,’ at the first Olatunde Abudu lecture on March 15, 2022, at Olusegun Obasanjo Presidential Library, Abeokuta, Ogun State.

“It is very critical for the government to formulate sustainable agricultural policies that will enhance wheat and rice production for national food and nutrition security, wealth and job creation for youth and women,” he stated.

He emphasised that increased investment in modern technologies is necessary for improving the productivity and sustainability of wheat and rice farming to cope with biotic and abiotic stresses, which are set to worsen with climate change.

Specifically, Olabanji said the impact of science and technology in agriculture could be seen in plant breeding, biotechnology (development of improved crop varieties, such as wheat and rice), mechanisation (application of tractors, seed planters, threshers/combined harvesters, etc), chemical fertiliser, crop protection and bio-fortification essential micronutrients.

“Crop breeding,” he explained, “offers the particular prospect of addressing emerging challenges associated with low productivity, heat stress, biotic and abiotic stress. The seeds generated from plant breeding have desired traits that allow increases in productivity, reduction of human malnutrition, improvement of genetic diversity in ecosystems and sustainable food production under the spectre of global warming.

Recent advances in biotechnology could revolutionise Nigerian agriculture through embryo transfers, gene insertion, growth hormones and other genetic engineering techniques.

Technologies emanating from scientific analysis of crops like wheat and rice, he added, help to genetically alter such crops to resist pests and diseases, and hence, improved productivity per hectare.

COMMERCIALISATION of new technology (such as Vitamin-A fortified cassava and maize) would further stimulate the expansion of farm sizes for food and nutrition security, and trans-genic modification confers a number of benefits, including tolerance to biotic stresses (insects and disease), abiotic stresses (drought), improved nutrition, taste and appearance, herbicide tolerance and reduced use of synthetic fertiliser.

Given the challenges of increasing water scarcity and land degradation, such technologies potentially increase productivity per unit area or plant from drought-tolerant varieties.

Well-known examples of modern genetically modified crops include Bt-cotton, Bt-maize in Nigeria and Bt-Maize in Kenya, Bt is Bacillus thuringiensis that produces proteins that are toxic to certain insects and is being used as a microbial insecticide.

Others, he added, include disease-resistant and early-maturing crop varieties in rice, wheat and maize, among others, were developed to drive food security and import substitution in Nigeria.

He emphasised that Nigeria is highest in cassava production following the development of mosaic virus-resistant variety that improved production in the 1990s.

Again, New Rice for Africa (NERICA) rice varieties that are hybrid combinations of African and Asian rice species, developed and promoted by Africa Rice Centre (AfricaRice), have contributed to rice productivity per hectare and are helping the country to inch towards rice sufficiency.

Using farm mechanisation as part of agri-techs, a farmer can cultivate more than two acres of land with less labour.
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The use of ridges, planters and harvesters makes agricultural processes easier and faster. The modern combine harvester, Dr Olabanji said, is a versatile machine designed to efficiently reap, thresh, gather and winnow different grains. Combine harvesters are one of the most economically important labour-saving inventions.

Other techs in agriculture include irrigation systems, water management and chemical fertiliser application, as well as crop protection, cooling technologies, seed tracker, seed codex (an electronic seed authentication tag), Global Positioning Systems (GPS), storage and processing facilities, agro-climatology (ideal climatic conditions for plants and animals).

In the array of techs in agriculture are digital extension services and the use of digital mass media in mobilising farmers for the adoption of improved agricultural technologies.

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