5 May 2008
interview
Lagos — The National Food Reserve Agency (NFRA) was created last year with the sole aim of making food available all year round at affordable prices. It was created to reduce post-harvest losses, by storing 5 per cent of the total food produced in the country for period of need. This, therefore, makes the Agency the first line of food relief in times of shortages.
The Executive Director of NFRA, is Dr. Samaila Ahmmed Ingawa, an Agricultural Economist. He first Studied Agriculture at the Ahmadu Bello University (ABU) Zaria, and graduated in 1975 with a Second Class Upper Division. He then went to Michigan State University in the US for his Master's and Ph.D in Agricultural Economics.
Dr. Ingawa came back and taught at ABU, Zaria as a lecturer in both the Undergraduate and Graduate Schools before his appointment to the Nigerian Export Council as a Director. He rose to become the Acting Executive Director of the Council before coming to the Federal Ministry of Agriculture _ the Federal Agriculture Coordinating Unit, (FACU) in 1997. But in 2000, it was turned to Project Coordinating Unit (PCU) and now, the Federal Food Reserve Agency.
In this interview with Financial Vanguard in his office in Abuja last Wednesday, Dr. Ingawa said that the rising food prices is a global problem, but that as far as Nigeria is concerned, the situation will never degenerate into a national food crisis.
What do you think is the reason for the soaring prices of foodstuff today?
I would like you to know that this is not a Nigerian phenomenon only. It is a global affair now. In fact, it is worse in other countries. Yes, countries like Haiti, Senegal, Egypt and so on. So it is not unique to Nigeria.
So what is responsible for this?
Part of the problem, as we have been made to understand, is the diversion of some of these food crops by Western countries for the making of bio_fuels _ ethanol and the rest. _ because of the rising cost of petroleum products worldwide. Again, there was also this climate change, which did not favour the growth of much food crops.
This has negatively affected the production and availability of food crops globally. And you know that the world is now a global village, whatever happens in one place, quickly affects the rest. So these negative factors have also affected Nigeria, especially the kinds of products that Nigeria imports - rice and wheat.
Most of the time, when you hear people talking about "soaring" prices of food, they are mainly referring to rice. But if you look at domestically produced commodities, like garri, maize, sorghum, millet, there are increases, but much, much, less compared to rice. Again, in the northern part of Nigeria or the "grain belt", there was deficient rainfall, which meant reduced production of grains. What happens is that all these food products are directly related. If you don't find one, you eat the other.
And that means that if the price of one commodity increases, it leads to increase in prices of others. So it is an intricate connecting system
Does this not call to question the kind of food reserve we have? For example, Nigeria is importing rice for N80 billion from Thailand.
It's true that the amount we have in reserve is outright inadequate and the government has already realised that. There are a number of silos that should have been completed long ago - a decade, and some two decades ago. Now; government has provided funds so that these could be completed. And the Federal Government is encouraging states and the private sector to go into buffer stock implementation. The states are supposed to store at least 10 per cent of whatever is produced.
What is the position of states' food storage now?
Well, it varies. Some don't store anything, some just a little. But what we are encouraging them to do is for them to look at products of comparative advantage, especially those that can be stored, specifically grains, and make provisions
. Even the private sector, government is encouraging it to construct warehouses to store some of these food products. For the Federal Government to say it would be the sole owner of the reserve, that may not work to the satisfaction of all. But government is increasing its storage capacity, getting more silos completed in the shortest possible time, and making sure that the reserve level is substantially increased.
What intervention measures are being put in place by the Federal Government for now?
Right now, the Federal Government is releasing 65,000 metric tonnes of various grain crops and garri to the public.
The sale is on now, and we are sure that it has led to a reduction of prices of some of these commodities such as maize, sorghum, millet and garri. Later, we should see even more relief as the states release more commodities to the public. So we are not in any imminent food crisis now.
And as you are aware, government has given directive for the immediate government_to_government negotiation to bring in about 500,000 metric tonnes of rice into the country to be sold at subsidised price. And as I have told you about the inter_dependent nature of food prices, we believe that once the price of rice comes down, it would have the tendency of pulling down the prices of other foodstuff.
Does that mean that there is now a lift in the ban of importation of rice?
And that is why I told you that there is a special government_to_government intervention. And let me correct you _ there is no total ban on rice importation, but there is a high tariff on it. The tariff on rice is high. It is, in fact, much higher than what obtains in our neighbouring countries. So there is a lot of smuggling going on from other countries into Nigeria.
The countries that supply rice find it more profitable to go to countries where the tariff is low, but invariably, Nigeria is where the market is. In fact, about 1.5 million metric tonnes of rice come into Nigeria through smuggling yearly from Chad, and Niger.
What is the level of reserve that will make Nigeria feel comfortable?
Like I said, reserve is a relative thing. Even now, there are lots of commodities in our reserves _ with the state governments, with the private sector and the Federal Government. If the Federal Government should put in one, or two million metric tonnes of food, that will just be intervention reserve. But the more you have, the better
. But by the measures being put in place now by the Federal Government, including guaranteeing minimum price, we believe a lot of surplus will be generated. We may even have to create more facilities for reserve storage.
How come the price of a commodity such as garri, which is believed to have glutted would not just come down? It has continued to rise ever since.
The problem with garri also is that we have inadequate, and sometimes, inefficient processing mechanism for cassava. Cassava is a low value, high volume product. You can't move it far from where it is produced. If you don't process it near the production area, then you have a problem. The problem is lack of processing capacity.
That is why you find the price of garri still high even when there is a lot of cassava on the farms. So we need to improve on the processing facilities of cassava _ convert it to garri; convert it to cassava chips, turn it to cassava flour that can also supplement wheat flour in bread. So, processing is the critical aspect of what is happening to cassava.
The Federal Government is therefore, looking into how it would help in massively processing cassava into other products so that it would be much more available and the price much more bearable.
Are you saying in essence that Nigerians should not panic about an impending food crisis?
I want to tell Nigerians that there is no cause for alarm. The Federal Government is aware of the situation and is making sure that this does not get out of hand.
Government is making contingency arrangement already, by bringing in this amount of rice and the release of grains from our reserves. Also, government is making sure that as we enter this rainy season, there will be bumper harvest. So there is hope. And I want to assure that government has also promised on increased funding for agriculture and food security for the next four years. I don't think we are in a bad shape; in fact, we are in for agricultural revolution in this country.
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