The prices of major food items such as maize, milk and plantain have almost doubled within 12 months, leading the pack in terms of the largest price increase in Nigeria.
According to the latest selected food prices report by the National Bureau of Statistics (NBS), the average price of 1kg of maize grain (white sold loose) rose by 93 percent to N580.1 in August 2023 from N300.5 in the same period of last year while the yellow type grew by 90.2 percent to N583.7 from N306.9.
The average price of a 170g evaporated canned milk carnation increased by 81.7 percent to N431.3. The price of 1kg of plantain (unripe) and plantain(ripe) rose by 78.6 percent and 77.1 percent respectively.
Others are a 170g evaporated canned milk (peak), which grew by 76.1 percent; 1kg of rice (local sold loose), 62.7percent; 1kg of rice (medium grained), 51.5 percent and 1kg of garri (white sold loose), 49.2 percent.
The report also revealed that the total average food price for the 43 food items rose by 31.5 percent to N51,414.1 from N39,108.5 with 1kg of frozen chicken (N 3,144.1), 1kg of Beef, boneless (N2,799.5), 1kg of dried catfish (N2,650.0), 1kg of dried mudfish (N2,535.1) and dried fish sardine (N2,226.9) recording the highest prices for August.
In the NBS’s latest Consumer Price Index report, food inflation rose to 29.34 percent, the highest in 18 years from 26.98 percent in July. Food inflation, which constitutes 50 percent of the inflation rate, was the major factor that pushed the country’s headline inflation to 25.80 percent from 24.08 percent.
“The rise in the food inflation on a year-on-year basis was caused by increases in prices of oil and fat, bread and cereals, fish, fruit, meat, vegetables and potatoes, yam and other tubers, milk, cheese and eggs,” the NBS said.
Unsurprisingly, food prices increased on the underlying factors such as the pass-through effect of elevated Petrol Motor Spirit prices on food prices, higher input costs and conflicts in the Northern region of the country – remain intact, according to analysts at Cordros Securities.
“Coupled with the above, the closure of the Niger Republic border in early August exerted fresh pressures on the food basket amid the lean season in food-producing states. Consequently, pressures were significant in the farm produce and processed food sub-baskets,” they said in a recent note.
Tola Balogun, a Lagos-based carpenter, said his family can’t even afford to eat thrice daily anymore as prices keep soaring.
“It is getting difficult daily for Nigerians, especially with the recent petrol subsidy removal and other reforms the Tinubu’s led-government has done. They are good reforms but they are seriously hurting Nigerians and businesses,” he added.
The Federal Government reforms such as the removal of petrol subsidy and naira devaluation, implemented in the second quarter of the year, increased the cost of living of cash-strapped consumers in Africa’s biggest economy.
The removal of the fuel subsidy tripled the petrol price to N617 from N184, causing public transportation providers such as buses, tricycles and motorcycles to raise transportation fares.
On June 14, 2023, the Central Bank of Nigeria merged all foreign exchange markets into the Investors and Exporters window and reintroduced the willing buyer, willing seller model.
The floating of the naira increased the official exchange rate from N463.38/$ on June 9, to N755.29/$ as of September 29. At the parallel market, the naira depreciated to N1, 005/$ from 762/$.
The high cost of dollars and the implementation of a 7.5 percent value added tax on diesel imports have pushed its pump price to as high as N1,200 per litre.
The World Bank said in June that inflation pushed an estimated four million more Nigerians into poverty in the first five months of this year.
“In the immediate term, the removal of the petrol subsidy has caused an increase in prices, adversely affecting poor and economically insecure Nigerian households,” it said.
It added that among the poor and economically insecure, 38 percent own a motorcycle and 23 percent own a generator that depends on petrol and that many more use petrol dependent transportation.
“The poor and economically insecure households will face an equivalent income loss of N5, 700 per month, and without compensation, an additional 7.1 million people will be pushed into poverty.”
According to the international organisation, many current, as well as newly, poor and economically insecure households will likely resort to coping mechanisms that will have long-term adverse consequences, such as not sending children to school, or not going to the health facilities to seek preventative healthcare or cutting back on nutritious dietary choices.
Tinubu in July declared an immediate state of emergency on food insecurity to tackle the increase in food prices.
All matters pertaining to food & water availability and affordability, as essential livelihood items, be included within the purview of the National Security Council, according to a statement.
Analysts at CSL Stockbrokers said food insecurity has been a cause of concern as the challenges of insurgency, low investments in agriculture, low mechanized farming, inadequate food storage methods and poor transport infrastructure have suppressed supply while demand for food products in a population-dense country remains high.
“The five-year tax break provided by the Federal Government to stimulate investments in the agricultural sector is yet to improve output in the sector. More so, the price levels of food products have risen significantly over the years as all of the factors mentioned above have either directly affected prices or have indirectly affected food prices through increased transport cost,” they added.