Farm input demand spikes on food price hike

Farm inputs dealers are smiling to the bank as increased food prices have pushed up demand for fertilisers, herbicides, pesticides and seeds.

Food inflation stood at 39.84 percent in December 2024, a 5.91 percent increase from the 33.93 percent recorded in December 2023, according to the latest report by the National Bureau of Statistics (NBS).

Due to the rising food prices, many Nigerians have gone into farming with a view to cutting their own slice of the cake. This has in turn led to the higher demand for agro inputs.

“The continuous surge in food prices is making farming attractive,” Ezekiel Opekunle, an agro-allied dealer in North-West Nigeria, told BusinessDay.

“We have recorded over 40 percent increase in input sales since half year of 2024 as demand from farmers continues to rise,” Opekunle said.

He said farmers who struggled to pay for inputs in the past now make payments upfront or immediately after harvesting.

“We do not chase farmers again for payment as most of them now pay upfront, even before we supply the inputs. They finish paying immediately after harvest.

“This is because the market is there for them to sell quickly, and the prices are attractive.”

Read also: Global food prices eases in Dec, lowest since 2021

Past vs present

In the past, high costs of inputs pushed Nigerian farmers to the brink, harming their profits. However, the country’s record food prices are changing the narrative and serving as an incentive for farmers to grow more.

Kabiru Fara, national president of the Agro Inputs Dealers Association, said there is currently a massive surge in demand for inputs by farmers across the country.

He attributed the surge to the decline in supply, saying that naira devaluation has made the business attractive.

“We had more agro-dealers when naira was exchanging for less than N500/$. But now with naira at N1,600/$, the majority of us are no longer in business and those still in business do not export as much as before,” he said.

“This is making the few of us see a surge in demand because we are supplying more farmers now than before,” Fara explained.

He noted that it cost about N6 million to import a 40-foot container of agricultural inputs in the first quarter of 2023 but now costs N25 million to import the same quantity.

Prices of fertilisers surged by an average of 270 percent in 2024. The NPK, a blend mostly used by smallholder farmers and urea, jumped by 168 percent. The cost of tomato, pepper, rice, sorghum and maize seeds rose by over 100 percent in the same period.

Similarly, the prices of pesticides and herbicides increased by 119 percent on the average in over 12 months.

“The rising food prices is a strong economic incentive for farmers to cultivate more, and many of them are smiling to the bank,” said Isah Mohammed, an agro-allied dealer in North-Central region.

“We got lots of orders for inputs from cocoa farmers in Taraba, as a ton sold for almost N15 million last year,” he said, noting that farmers who cultivate tree crops that would typically not apply herbicides and pesticides on their farmlands are now doing so to ensure they mature well.