Lagos – The growth in the local agricultural
sector over the past year has boosted justification to diversify the Nigerian
economy from an over-reliance on oil as well as reducing imports of some
The sector grew by 3,5 percent year-on-year in the fourth
quarter of the past year and 3,7 percent year-on-year in 2015.
Crop production, the largest contributor (89,5 percent of
agricultural gross domestic), grew by 3,3 year-on-year while livestock and
fisheries expanded by 5,6 percent and 5,4 percent respectively in the fourth
First Bank of Nigeria (FBN) noted the decline in oil
receipts has created acute foreign currency scarcity and highlighted the
country’s heavy reliance on foreign sourced goods and services.
“This has added urgency to the FGN’s import substitution
strategy, which is concentrated on agricultural products,” FBN stated on
The bank noted there were eight agric-related products on
the CBN’s list of imports no longer eligible for foreign currency from official
They include rice, fish, palm oil products, poultry and
tomatoes/ tomato paste.
According to FBN estimates, less than 15 percent of
domestic foreign currency demand is met at the official window, leaving
manufacturers with the choice of going without their inputs or trying to source
their foreign currency requirements at a hefty premium on the parallel market.
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“We see a growing trend of companies in the food and
beverage industry utilising domestic agricultural inputs where possible.”
A number of initiatives are in place to boost the
Government plans to partner with the UN World Food Programme
to implement its home-grown school feeding programme.
This is set to stimulate the agric sector as local
farmers will be responsible for supplying the products used in preparing these
In the fisheries segment, government, in conjunction with
the Farmers Development Union and a Dutch agricultural development company,
Oxfam Novib, have announced plans to boost commercial fish production.
This programme will focus on small-scale fish farmers and
provide them with floating fish feed as well as other technologies.
The macro challenges have intensified the pressure on
business to make greater use of domestic raw materials.
FBN said potentially, the sector stood to benefit from
the restrictions imposed by the authorities.
“However, the government has to create the appropriate
enabling environment. There are vast opportunities in the agribusiness value
On a macro level, it is a major job generator.”
- CAJ News