The Managing Director of the Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL), Aliyu Abdulhammed has signaled the possibility of pushing for government intervention on huge indebtedness by the seed sector to banks, working with closely
other stakeholders in the industry.
Abdulhammed gave the indication Monday at the Finance and Investment round table discussion on seed and grain primary processing technology for Nigeria organized by NIRSAL Monday in Abuja.
Abdulhammed was of the opinion that NIRSAL collaborating with the relevant stakeholders would have enough weight to pull this through considering how important that sector is in the actualization of their overall objectives in the Agriculture sector.
He said NIRSAL was concerned because such negative factors, particularly poor funding contribute significantly to Nigeria’s annual US$9billion worth of postharvest losses.
This in turn, have led to lower capacity to service the consumer, industrial and export grain markets, lower returns to the farmer, inability to fulfil financial obligations or repay loans, sustained poverty and impoverishment, he said.
‘My thinking is that regarding seed sector indebtedness to banks, we would need to see whether the government can securitize that debt and issue a promissory note to get the debts off the books of the banks and make them financeable again.
“It is a model we can take up, working with the seed council and make a solid case for it,” he stated.
He also suggested setting up an anchor borrower scheme specifically for the seed industry that supports primary production and small holder farmers.
Meanwhile, NIRSAL is currently leading a diverse and high-level group of local and international experts to seek efficient and sustainable solutions that would help the country overcome the obstacles that are preventing the seeds and grains value chain from achieving full investment viability.
To achieve the objective, the corporation hosted a Stakeholders Round-table Discussion on Seed and Grain Processing Technology for Nigeria focused on key challenges limiting the financial viability of the Cereal and Legume value chains in Nigeria which occur at the Seed
Input and Grain Output stages.
Among the participants at the event were top officials of PETKUS GmBH, a German and world leading post-harvest management company with a 166-year history in manufacturing of custom-made post-harvest solutions across the world; the Director General of the National
Agricultural Seed Council (NASC) and the President, Seed Entrepreneurs Association of Nigeria (SEEDAN).
The central focus of the event which is central to NIRSAL’s core mandate of making agriculture attractive to the financial sector is to confront these challenges in a way that significantly reduces the current aversion of financial institutions to lend to this important value chain.
Speaking at the event, Abdulhammed recalled August 2018 when NIRSAL signed a partnership agreement with PETKUS in the presence of President Buhari and Chancellor Angela Merkel of Germany during the latter’s visit to Nigeria.
“Besides a Memorandum of Understanding (MoU) with Petkus, NIRSAL has performed background assessments and field reality checks on the Petkus solutions through observations not only in Germany but also in Burkina Faso, an African nation where Petkus solutions have been piloted with 1,000 smallholder Seed farmers in one (1) district with current scale up to 13 geographical districts,” Abdulhameed further explained.
Petkus, in a similar manner, gained insights to the workings of the local Nigerian primary production systems testing the quality and viability of sample certified seeds and witnessing the huge post-harvest losses and absence of basic value addition technologies in Jigawa, Kano and Taraba States.”
Petkus expertise includes high precision seed processing equipment and technology solutions to address issues of poor separation of dead, broken and non-viable seeds and issues of heterogeneous seed sizes which pose significant problems for mechanized planting.
It also has the capacity for high precision grain cleaning to capture best value, eliminating moisture content, aflatoxin contamination and other infestation at point of harvest.
NIRSAL is also looking to leverage technologies from Germany to tackle primary production and harvest, primary processing, primary transportation and primary storage challenges, which we call the PH-P3.
In his goodwill message, SEEDAN President, Richard Olafare said access to modern seed and grain processing equipment are essential for quality assurance in any crop value chain.
But access to seed processing facilities is not the only problem facing the Nigerian Seed industry.
“Early Generation Seed (breeder and foundation seed) and certified seed production; access to adequate finance for seed production and marketing; seed infrastructure; research and development are other bottlenecks affecting the development of the Nigerian Seed Sector and
should not be ignored.”
Another point of concern, according to him is the long overdue GESS payments which has crippled access to funds for the seed sector as commercial banks that availed credit facility to seed companies under the scheme are not willing to give fresh credit facility.
“More to this is the incessant harassment and blacklisting by some commercial banks,” he lamented.
He said SEEDAN members are also eager to know the modalities for accessing these seed processing equipment and would want Petkus and NIRSAL to put into consideration the classification of seed companies so as to ensure that beneficiaries of this scheme cut across the three classes.
Phillip Ojo, DG National Agriculatural Seed Council of Nigeria however called for the setting up of a National seed fund to tackle the funding issues in the sector.
Onyinye Nwachukwu, Abuja
