According to the National Bureau of Statistics (NBS), Nigeria’s agricultural growth slowed to 1.88% in 2022 owing to the devastating flood incidents recorded in key crop-producing states and the supply chain obstruction caused by the Russian-Ukraine war. The sector grew by 1.88% in 2022 in real terms, which is 25bps less than the 2.13% recorded in 2021. Although the agricultural sector grew by 2.05% in Q4 2022, it was still significantly less than the 3.58% rec0rded in 2021.
Farming activities have been significantly affected in 2020 due to covid-19 movement restrictions during the planting season. With the reopening of the economy post covid, there were positive expectations for the agricultural sector in 2022. The year had promised a bumper harvest for farmers who started to see rainfall as early as February. However, challenges such as the Ukraine invasion, floods, surge in input costs, and worsening insecurity pressured the output of the sector. Floods destroyed hundreds of farmlands across the country, causing a large-scale destruction of farm produce, with the damage estimated to cost over N30 billion. While the country has previously experienced seasonal floods, the floods of 2022 have been considered the worst since 2012, according to the Ministry of agriculture.
Insecurity also remains a big problem, with farmers constantly calling on the government to address issues of terrorism, banditry, and herdsmen attacks across the country as well as armed robbery and kidnapping that have constantly put farmers and their investments in peril. Looking ahead, we believe that there is a need for a holistic approach towards mitigating the shocks from the several headwinds plaguing the sector in order to position it to spearhead the economic growth and development plan of the country. In our opinion, while short term relief for farmers is necessary to immediately alleviate some of the pressures on food prices in the short term, we think some of the flurry of funds provided via intervention policies should be directed at resolving long standing bottlenecks to truly maximize the full potential of Nigeria’s agriculture promise
