• Saturday, July 20, 2024
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BusinessDay

Food prices in Nigeria defy logic as global prices drop

food-market

Prices of food commodities in Nigeria have been on an increase whereas global food prices have dropped for the fourth consecutive year.

The Food and Agricultural Organisation (FAO) of the UN  at the end of 2015 revealed an “averaged 164.1 points over 2015 and ended the year even lower, at 154.1 points during the month of December. In December, the index declined a further 1.0 percent from its revised November value, as falling prices for meat, dairy and cereals more than offset gains by sugar and vegetable oils.”

Food-Price-Chat

FAO senior economist Abdolreza Abbassian is quoted as attributing the drop in food prices to “abundant supplies in the face of a timid world demand and an appreciating dollar are the main reason for the general weakness that dominated food prices in 2015”

In Nigeria however, prices of food commodities have been on the increase without recourse to price drops on the global scene. While prices dropped even further at the end of 2015, the opposite was the case in Nigeria. At the beginning of 2016, prices have remained largely unchanged. A big basket of tomatoes presently sells as high 8,000, a big sack of onions, 9,000 and rice sells at over 11,000 naira.

commodity-chat

Analysts including Professors Victor Okoruwa of the University of Ibadan and Lateef Sanni of the Federal University of Agriculture, Abeokuta, describe energy costs, lack of infrastructure; including poor roads and lack of storage facilities, as factors responsible for high food prices in Nigeria.

Caleb Ojewale