Viewpoint

April 12, 2020

COVID-19: CBN’s policies boost strategic grain reserve

By Tiri Akanfe

When President Muhammadu Buhari ordered the release of 70,000 metric tonnes of grains from the country’s National grains reserves to be shared among the poor and vulnerable people, following lockdown occasioned by coronavirus pandemic, my mind raced to the days when the country depended on food importation for survival, until the President intervened through the Central Bank of Nigeria, CBN.

There was a time the country relied heavily on importation of basic food commodities such as sugar, wheat, flour, fish, milk, palm oil, pork, beef and poultry to augment what the domestic farmers produce.

And that did not come without a price on the country’s economy as lots of scarce foreign exchange earned from the country’s main source of revenue, oil, was expended on the food import.

There was a time Nigeria spent nearly $2.9bn(£2.4bn) on food import before the Federal Government directed theCentral Bank of Nigeria to block food importers’ requests for foreign currency in a bid to boost local agriculture in Africa’s most populous country.

President Muhammadu Buhari had said then “we are taking our focus on agriculture to the next level. In our first term, we partnered with Morocco to revive abandoned fertilizer blending plants across the country, and also introduced the anchor-borrowers’ programme to provide cheap credit to small scale farmers.”

The Central Bank, under the leadership of GodwinEmefiele, came up with various intervention programme to boost local food production through schemes like the Anchor Borrowers’ Programme and Commercial Agricultural Credit Scheme after it had banned access to foreign currency for 41 items that the bank felt could be manufactured in the country, including rice and poultry.

The CBN’s finance interventions have helped to bolster agricultural production by removing obstacles faced by smallholder farmers, improved access to markets for farmers by facilitating a greater partnership with agro-processors and industrial firms in the sourcing of raw materials.

The CBN’s anchor borrower’s scheme which ensures off-takers in rice, maize and production of other grains is itself a revolution. A sustainable value chain in the agribusiness has been created. For instance, the resilience the country has built unwittingly against the COVID-19 pandemic is a glowing testimony.

More than 1.5 million farmers across all the 36 states of the federation have been assisted through the programme to cultivate about 16 different commodities over 1.4 million hectares of farmland.

The intervention in the rice value chain in Kebbi and other rice-producing states across the country resulted in increased local rice production from 2.5 million tonnes in 2015 to what has led to the astronomical local rice production in the country today as that efforts of the CBN have generated good result as the country is now producing 3.7 million tonnes of rice annually, according to the US Department of Agriculture, World Markets and Trade.

AminuNdakogi, a rice farmer in northern Nigeria once told the BBC: “I started farming with only one hectare, and the average (yield) was 2-3 tonnes. When I integrated with (a non-profit organisation) the International Forum for Agricultural Development, IFAD, I was able to increase my cultivation to three hectares, with an average of eight tonnes.

“I’m planning to increase my cultivation to five hectares.”

The rural village of Kanko, in central Nigeria, has also benefited from government and non-profit support.

There are 100 rice farmers in the village, who are now able to produce 15 tonnes of rice from 200 hectares of land a year.

A similar intervention in cotton production with the flag-off of input distribution to 150,000 cotton farmers resulted in the cultivation of150,000 hectares in 23 states of the federation.

Mr Adamu said currently, the cotton planted by these farmers has begun fruiting, while some are ready for harvest and off-take.

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The CBN programme has supported the creation of over 2.5 million jobs across the agricultural value chain, with the apex bank currently paying additional attention to cassava which has many different uses along the value chain.

The former Secretary-General, National Union of Textile Garment and Tailoring Workers of Nigeria, Issa Aremu, said the intervention of the CBN had helped to revive the textile sector.

If properly funded, he said the country can generate about 3.5 million jobs in the economy through the textile industry alone.

It will not be out of place to say that the intervention of the Central Bank of Nigeria in agriculture has led to the improvement in the country strategic grains reserve today from which the President, Muhammad Buhari, has ordered to be released to Nigerians in this time of crisis.

The distribution of food released from reserves during a crisis is coordinated by the Ministry of Humanitarian Affairs and Disaster Management and Social Development and it was not surprising that the Minister of Agriculture, Muhammad Sabo Nanono, Monday, handed over 12, 500 metric tonnes to Hajiya Sadiya Umar Farouq as part of the release of the 70,000 metric tonnes ordered to be released by President Muhammadu Buhari to vulnerable Nigerians for sustenance during the lockdown.

The Minister of Humanitarian Affairs, Disaster Management and Social Development, Hajiya Sadiya Umar Farouq, promised that all measures will be put in place to ensure that the food items get to the vulnerable population as directed by the  President

So, the release and handing over of grain from the strategic grain reserves underscores the workability of an emerging agro-based diversified economy which, if sustained, could actually free the country from wasteful food importation, including multi-purpose wheat.

Nigeria’s import restriction and emphasis on home-grown foods, driven by the CBN on behalf of the FG is indeed the saving grace for food independence at times such as this — the COVID19 pandemic.