How can Nigeria beat rising food inflation?

Nigeria recently recorded a significant surge in its food inflation rate to 40.5 per cent year-on-year in April, fueled by soaring prices of staple foods. Chike Nwagu, Director at Novus Agro, shared insights on the ongoing essential commodities price crisis in the country and discussed strategies to tackle food inflation during a TV interview on CNBC Africa. The alarming statistics reveal a troubling trend in the cost of essential food items such as rice, beef, beans, gairi, and yam which have experienced price hikes of over 100 per cent in recent months. These inflationary pressures are intensifying the economic challenges faced by the average Nigerian consumer. Despite the official figures reported by the National Bureau of Statistics (NBS), Nwagu highlighted the need for a more accurate reflection of the inflation numbers to resonate with the daily experiences of ordinary citizens. He emphasized the importance of recalibrating the basket of goods used to calculate inflation to provide a more realistic picture of the cost of living for Nigerians. The rising cost of essential commodities can be attributed to both the escalating cost of production inputs and low agricultural productivity. These factors create a cost-push inflationary environment, making it challenging to mitigate the economic strain on consumers. Traditional strategies like raising interest rates may not be effective in combating this type of inflation as they could further drive up production costs and ultimately raise consumer prices. The current currency volatility and heavy reliance on food imports further exacerbate the country's economic woes, necessitating innovative solutions to address the escalating food crisis. Private players in the agricultural sector are also grappling with the economic fallout, particularly poultry and fish farmers who face skyrocketing feed prices that erode their profit margins. The sustainability of agribusiness ventures hinges on maintaining profitable price points amid surging production costs. Nwagu underscored the necessity of reducing input prices to safeguard the viability of agricultural enterprises and ensure food security in the country. As Nigeria grapples with the onset of the rainy season and the looming threat of floods, challenges such as post-harvest losses, farm inundation, and inadequate storage infrastructure pose additional obstacles to food security. The need to enhance security measures, optimize storage facilities, and fortify supply chain linkages is paramount in safeguarding food production and distribution. Looking ahead, the outlook for the grains market remains bleak as prices are projected to continue their upward trajectory until the next harvest season in October or November. The persistent inflationary pressures coupled with escalating input costs are anticipated to prolong the economic strain on consumers and agricultural producers alike. Despite the daunting challenges ahead, efforts to promote all-year-round farming initiatives and enhance agricultural resilience are critical to navigating the turbulent economic landscape and bolstering food security in Nigeria.