New Telegraph

‘Food crisis threat persists over FX shortage, others’

Despite the downward trend in food inflation in recent months, Nigeria is still facing the risk of a food crisis because the rising costs of fertilizers occasioned by forex scarcity, has forced farmers to reduce their use of fertilizers, analysts at CSL Research have said.

In a note obtained by New Telegraph yesterday, the analysts also stated that the threat of a food crisis had not been averted due to pervasive insecurity which is preventing farmers from accessing their farms. Furthermore, the analysts pointed out that for as long as local produc-tion continues to significantly lag consumption, the threat of a food crisis in the country would not completely disappear. The analysts stated: “The rising prices of food staples are pushing many households below the poverty line.

Based on the selected food price watch data for September 2021 released by the National Bureau of Statistics (NBS), major consumer staples showed significant increases year on year. “Though food inflation has been trending down in recent months, food prices are still on the rise. This is because the descent in food inflation is largely due to base effects and not improved fundamentals. The data showed that prices of major food items moderated on a m/m basis in September, and we believe this was due to gains of the early harvest season. “Despite the recent moderation in the food prices m/m, we are still far from averting a food crisis.

One, the use of fertilisers by farmers has been limited given the rising costs of fertilizers, further exacerbated by the ineligibility to source FX from the official market in importing fertilizers.” They further stated: “The food supply chain disruptions caused by the pandemic translated to an increase in price across food items in the country. Insecurity in the country, ranging from incessant attacks on farmers by herdsmen to banditry and kidnappings, have further worsened the situation, leading to a greater risk of food crisis. The closure of the borders also contributed to the increase in food prices. However, despite the reopening of the land borders, food prices continue to rise.

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