Central Bank of Nigeria (CBN) plans to address key problems in production of wheat
United States has lost 54 per cent or N677.5 billion ($1.36 billion) of its wheat supply to Nigeria to competitors.
Prior to this development, the country supplied 80 per cent of the grain to Nigeria.
However, Russia, Canada, Ukraine, Kazakhstan, Australia, Latvia and Lithuania, which are the major competitors, have snatched the bulk of wheat exports coming into Nigeria.
Findings revealed that Nigerian millers would take delivery of 5.2 million tonnes of the grain valued at N1.25 trillion ($2.5 billion) before the end of the year as the country’s total local production is estimated at one per cent or 63,000 tonnes in the 2020/2021 season.
The Federal Government had planned to cut wheat importation by 60 per cent by December 2025, but as at 2020, Nigerian millers spent $2.1 billion on the importation of the grain needed for consumption.
Data by the United States Department of Agriculture (USDA) revealed that the country’s millers spent $6.05 billion to import the grain between 2016 and 2019, adding that in 2016 a total $1.2 billion was spent to purchase wheat; 2017, $1.5 billion, while in 2018 and 2019, $1.65 billion and $1.7 billion were spent respectively.
The USDA data revealed Nigeria as the fifth largest United States wheat importer in the world with a total of 1.29 million tonnes in 2020.
Currently, it noted that the shares of wheat flour for bread, semolina, pasta and others, remains at 60per cent, 20 per cent, 10 per cent and 10 per cent respectively.
In the first quarter of 2021, USDA explained that Nigeria experienced 47 per cent increase in wheat importation, making consumption of semolina, pasta and noodles more predominant. It noted that Nigerian importers considered U.S. wheat as a high quality product, while supplies are consistent and reliable.
Early this month, the Central Bank of Nigeria (CBN)’s Director, Development Finance department, Yila Yusuf, proexplained in Abuja at a conference and stakeholder engagement, with the theme ‘Improving and Sustaining the Wheat Value Chain Development in Nigeria’ that the bank had sought to focus attention on the wheat value chain for 2021/2022 dry season planting after sustainable progress across the rice and maize value chains, saying that the country spends $2 billion annually on the importation of wheat.
He noted: “The CBN plans to address key problems in the value chain through financing massive production of wheat in Nigeria and seeks to facilitate sustained availability of high yield seed variety in country and improve general productivity.”
Yusuf described wheat as the second highest contributor to the country’s food import bill, putting pressure on the country’s foreign reserve as over $2billion was spent annually on the importation of over five million metric tonnes (MT) of wheat. He estimated that only one per cent or 63,000tonnes of wheat, out of the five to six million metric tonnes of wheat consumed annually, was produced locally.
The director added that CBN’s intervention had become critical due to the high demand for wheat in Nigeria and the inability to meet that demand. Apart from wheat export to Nigeria, USDA added that other United States’ food and agricultural supplies to Nigeria had been reduced to 33per cent from $653 million in 2019 to about $489million in 2020, adding that Nigerian depends on Europe, Asia, the United States, South America, and South Africa as major sources for agricultural imports.
It said: “U.S. food and agricultural products exports to Nigeria averaged $537million over the past five years—about 70per cent of which was wheat. “Last year, Nigeria imported over 1.29 million metric tonnes of wheat from the United States, making it the fifth largest U.S wheat importer in the world.
“Nigeria also imports U.S.- origin soybeans, intermediate food products (especially vegetable oils and animal fats), consumer-oriented food products such as condiments and sauces, processed vegetables, wine, prepared food, dairy products, and non-beverage ethanol and fish products.”
Also, the USDA added that the country was a potential market for approximately 2.5 million metric tonnes of Atlantic mackerel, horse mackerel, herring and croakers fish valued at $3 billion.