Olabode Abikoye, head, Agribusiness, Union Bank of Nigeria has said that addressing the challenges of market access for agro commodities is vital for the growth of the country’s agribusiness.
According to Abikoye, understanding market access system for food and livestock in Nigeria is important to address the nature of market access problems. It is only by doing so that workable solutions can be proffered.
He opined that the knowledge of marketing problems would shed more light on why linkages with input suppliers, primary producers, aggregators, processors and final consumer should be developed.
Speaking further on the large number of middlemen in the sector, Abikoye said, linking primary producers with other players in the value chain is viewed as a complex process and it involves a large number of intermediaries handling a variety of agricultural commodities.
“The prevalence of these intermediaries varies with the commodities and the market access channels of the products. Because of the intervention of middlemen, the primary producer’s market share is significantly reduced,” he said.
According to him, financial obligations force primary producers to sell off their commodities immediately after the harvest at low prices. Such forced sales or distress sales keep the producers in a vicious cycle of poverty. “Statistics have shown that primary producers in Nigeria often sell their produce at unfavourable rates,” he noted.
However, Abikoye thinks agricultural holdings are small and spread throughout the country. Consequently, the surplus generated is very meagre. “It is not an easy task organising how the goods can be assembled for efficient market access,” Abikoye added.
Nevertheless, he identified lack of effective transport facilities as a major challenge in agric business. According to him, absence of effective transport service in some agricultural areas in Nigeria, seasonality of transport service, high diesel cost leading to high freight charges and lack of all-weather roads and transport vehicles, are the things killing the sector.
Join BusinessDay whatsapp Channel, to stay up to date
Open In Whatsapp
