This reinforces the critical need to address food inflation as a pivotal aspect of managing overall headline inflation rates
The Central Bank of Nigeria (CBN) has provided clarifications regarding its recent donation of 2.15 million bags of fertilisers to farmers across the country through the Federal Ministry of Agriculture and Food Security.
The CBN had on Wednesday donated fertilisers valued at over N100 billion at current market prices, aiming to support domestic agricultural production and address rising food inflation.
Inflation in Nigeria has continued to rise largely because of the high cost of food items. As of February, the country's annual inflation rate rose to 31.70 per cent from 29.90 per cent in January.
In his remark, the Governor of the Central Bank of Nigeria, Olayemi Cardoso, said the bank is committed to price stability, recognizing the significant impact of food prices on inflation. Acknowledging persistent inflationary pressures, particularly in food prices, he emphasised collaboration with the agriculture ministry to address these challenges.
"This reinforces the critical need to address food inflation as a pivotal aspect of managing overall headline inflation rates. While the CBN has been implementing comprehensive measures to curb inflation, it is evident that in the short term, inflationary pressures may persist, predominantly driven by escalating food prices," Mr Cardoso said.
The apex bank governor had upon assuming office suspended all direct interventions in the real sector of the economy saying it was not the apex bank's mandate.
In a note published on its website on Saturday, the bank said it has not initiated any new intervention but has rather donated fertilisers from the remnants of its stock, which were blended under its previous interventions in the agricultural sector.
"These fertilizers are now being donated to farmers across the country through the Federal Ministry of Agriculture and Food Security. This decision is aimed at supporting domestic agricultural production rather than allowing the fertilizers to remain unused and go to waste. We anticipate that the fertilizers will ultimately support our overall objective of price stability which is being challenged by rising food inflation," it said.
On why the fertilisers were released to the ministry, the CBN said it is realigning its focus towards its core mandate of ensuring monetary and price stability, thus stopping its direct involvement in development finance interventions.
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However, it said it will support relevant organisations that possess the expertise and capacity to intervene directly.
The bank said the partnership was aimed at supporting the ministry's efforts to enhance food productivity and security, ultimately curbing food inflation and reinforcing the CBN's pursuit of price stability.
Addressing concerns about the distribution process, the CBN stated that it collaborated with the ministry due to its expertise and infrastructure for efficient delivery to farmers. It also clarified that they will be distributed to farmers free of charge to enhance agricultural productivity and ultimately contribute to price stability.
Giving details of the donated fertilisers, it said the 2.15 million bags contained various blends of fertilizers, with each bag of fertilizer weighing 50 kilograms.
A breakdown of the donated fertilisers includes 545,000 bags of NPK 20-10-10, 542,200 bags of NPK 27-13-13, 378,091 bags of NPK 15-15-15, 635,444 bags of UREA, and 50,000 bags of SSP.
