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‘Government needs to put the right policies in place for agricultural growth’

By Jimoh Babatunde
Discussing with Prince Emma Ajayi,  Managing Director & Chief Executive Officer , Biostadt formerly Syngenta, is always a delight.


In this interview with Jimoh Babatunde in Lagos last week, the agronomist shares his views about Nigerian agriculture. He said with good agricultural policies in place that the sky is the limit for the industry’s growth. Excerpts.

On commercial agriculture
For me, it is simple logic, we don’t need to do anything special, government should come up with right policies and follow these policies up with the right regulatory framework. If we look at backward integration it is not quite well and again it is  simple logic.

You get all the companies using agriculturally base raw  materials to source their raw materials locally, so if Nestle uses soya beans, let them source their local beans locally.

Then Nigerian business will set up a commercial farm to produce soya beans and supply to nestle, the same goes for the cassava flour that the government made a policy which should be added to bread flour for bread making. We can come up on it, emphasis it, get it working and you will see people who will set cassava plant, who will buy cassava, process cassava and sell to the flour millers.
For me that is what we need when it comes to commercial agriculture and to sustain it, it also means we need to sustain the market, because once there is a market that means supply will find its way into the chain.

On extension workers
Right in the 70s this was already seen as a major back bone in improving agriculture and when the World Bank came they worked with the government to set up the Agricultural Development  Projects(ADP), the main objective being that the project should be involved with the extension network.

When the world bank pulled out, specifically after the annulment of June 12, 1993 elections, most of the ADPs became ineffective. They did not have the right financing to the point that today, some of the ADPs don’t have up to 10 motor cycles. So, it is glaring that extension is almost dead in this country.

A country like India they have one extension worker to 20 farmers, a country like Bangladesh, one extension worker to about 25 farmers, in US an  extension worker to 20 farmers, in England, France, Germany it is the same thing and that is the recommendation of the FAO.

But in Nigeria, we are talking of one extension worker to 2000 farmers. I am sure many farmers have not seen an extension worker for the past five years in many states.

It is a horrible situation. All we need do if for the various state governments to give more financial backbone to the ADP and as a deliberate policy let the ADPs employ agricultural graduates, government should provide motor cycles and then have village extension agents apart from that we need to have subjects matter specialists, who are supposed to be training them fortnightly and the extension officers at the zonal level supervising them. This is the way the farmers will get to know what they are supposed to do and how they are going to do it.

That is how the framers will know the new technology including new products and that is only way they will learn what we call demonstration plots, adoption techniques which are used to show farmers what they are doing right or wrong.

It is an opportunity for the farmers to see their seeds’ vanities and the new varieties. That was how cassava variety, PMX3235 which is very common among farmers now was extended to them. That was how many products were introduced to farmers in the past.

On Agro financing
We have various scheme for agriculture  financing.  Of course you know the popular one, the  Agriculture credit guarantee scheme of the world bank. The Nigerian banks are business ventures set up to make profits and when they give loans they are supposed to make profit.

At present, the structure of the  Nigerian farming system does not favour loans and people find it difficult to understand that banks don’t give loans to farmers.

The other problem is that you cannot take commercial loans for farming and even the Agricultural Credit Guarantee Scheme (ACGS) draw back and of course on the other hand, many Nigerians are very conservative with the truth they will not give you all the documents they are supposed to give.

And if you don’t give the documents the banks cannot see through. A good credit officer must examine his exists strategy when giving you a loan and that exists strategy even for agricultural loans have been very difficult to understand.

Having said that, you will also remember that the government in the 70s, in its wisdom, set up the Nigerian Agricultural Bank which later changed to the Nigerian Agricultural Co-operative and Rural Development Bank. The question is what has happened to this bank? What is the bank  doing? Why is the government not empowering it?

The bank was doing well in the 60s and the 90s, why did the bank  die all of a sudden, this is a development bank, set up major ly for agriculture, so why is government dancing round the bush. ? Why can’t they seat down with this bank to ask what they need, what are the challengers, how doing do we get out? The banks have branches in all the local government areas.

Why did they not give the N200b agric. fund given to the commercial banks not given to the Agriculture bank which is the industry bank?

So for me, if the government wants the agriculture N200b to be effective, it has to look at the Nigerian Agriculture bank to see its programs and re package the bank, give them that money as well as revive the ACDF, from the bottleneck from the ACDF and get it working, so that those who want to access it do so. N200b, some of the states are accessing it, some companies have accessed it, but we know not up to N50b of the money has been disbursed almost two years after it has been set up. So there are challenges.

On revival of cash crops production and value addition to agricultural products
You see, you cannot divorce what is happening in this sector from what is happening in the entire macro economic environment  in Nigeria. Talk about rubber, rubber was doing well, Michellin and Dunlop invested in plantations and they have processing plants in Edo, Delta and Cross River stats and where doing well, they were producing latex, processed to flats and supply them to their factories in Lagos.

Beautiful arrangement, good value chain set up, but the importers of tyres were bringing in it very cheaply, Dunlop and Michelin could not produce locally in order to compete with the imported brands.

As a going business what do you do? You cannot continue to make losses forever, but you have to look at where the losses are coming from. Why do I have to produce and I cannot sell, I have to decide? They decided and closed down their manufacturing plants. Some of them borrowed to finance their operations, and they have to restructure their loans today. And what naturally happened.

The plantations will be going down. Yes, some of them are still the plantations, like the one of Michelin, but they produce latex and try to export. Dunlop balkanized their estate and sold what they recover to cover cost. That is the problem we have in Nigeria.

Cotton, we all know the story, everybody has shouted and nobody seems to be listening. Textile mills are closed, why did textile mills  close down? Nobody was using their cotton, if you produce in  the first year no buyer and the second year, the  same thing, who will produce again? So you have to look for another alternative.

There was time we had big cotton farms, Afcot had 33000 hectares cotton farm in Adamawa state and doing very well with a lot of expatriates, with spraying aircraft, but al that is gone.

Boston had another 4000 hectares cotton farms plus thousands of out growers, but they closed down the farm too. Nobody will want to put up such facilities there and walk out of it after five years with loans on their neck.

It is an issue of the entire way the economy has been managed, so until we get it right in our economy things will not take shape the way they should.

On oil palms, we have two companies doing very well in Nigeria and they are in the stock market. And we have seen how their share prices are doing well, all said and done these is simple economics, what to invest, where to invest.
Processes for value addition, again will only succeed if the economy allows it. Why do I bother my self to process if I don’t have money to buy generators? I could as well sell my cocoa beans and just forget the next headache.

The infrastructures are not there. To transport the cocoa, even from the rural areas to where my factory will be based and when I add value, what will I get in terms of the price? And what is the difference between selling at that price and selling directly looking at all the other costs that I have to bear. ? It is a major issue and until all these issues, infrastructural, power, value addition will still be a problem.

Yes, there are small projects here and there, like I know some cassava processing plants in Taraba, Osun states, they are adding values and they have buyers and they are selling to them, but again investors would have calculated all the cost elements and benefits.

On Biostadt is offering farmers
In terms of inputs what we are doing for Nigeria farmer is simple. We have de centralised our distribution system making them closer to the farmers. We have engaged extension agronomists to teach and train the farmers how to use our products all over the country.

For us as an enterprise, we believe that is the best we can do, let the farmers see the benefit of our products, let the farmers see how our products are used, and let the farmers derived pleasure in using our products, because we believe we are here to give value and it is when the farmers have value that they can enjoy their lives. We want the best for the Nigerian farmers.

We are also there for the farmers when they have problems as we want to solve the problems right there on the farms.
We are also broadening our offer for the nigeria farmers as we want to create a one stop centre for the farms.

We are providing seeds now to Nigerian farmers, we are providing the weed control agents for them, we are providing insects control products, disease control products, we are providing seed treatment to treat the seeds before planting, so that they can expect that the seeds  will grow without being affected by insects and other microorganism.

We are providing them  with foliar fertilizers, now we discover that the granular fertilizer is becoming difficult for him to access and so we said when your crops are growing, now you are on the field, why should your crop suffer, we give you foliar fertilizer to apply. This foliar fertilizer is water based and it is organic. It is beautiful for maize, and it is beautiful for rice, beautiful for vegetable. For this year those that have used it are very happy.

So we are also creating a one stop shop for the farmers, so they don’t have to look for tree treatment from A, crop agents from B, and start waiting for fertilizers. Now we tell farmers go ahead and plant quality seeds, use our chemicals and you need fertilizers, you don’t have to wait and go too far, we give you foliar fertilizer, organic base, you apply, you are home and dry.

If I happen to be in government in any form, I will tell government to let us have the right policy framework for agriculture. Policy frameworks as it touches inputs, as it touches production, as it touches the market.
Look at all our industry, where can we save foreign exchange, why do they continue to import and with the right policy agriculture will move forward.


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