Reference Date: 23-March-2017
FOOD SECURITY SNAPSHOT
Above-average cereal harvest gathered in 2016
Coarse grain prices remained at high levels driven mostly by weak local currency
Food security situation deteriorated significantly in Borno State, due to impact of civil conflict
Above-average cereal harvest gathered in 2016
Harvesting of the 2016 cereal crops was completed in January 2017. In spite of the late onset of the 2016 rainy season in the middle and northern parts of the country, above‑average and well‑distributed rainfall from mid‑July benefited crop development in the major producing states of the country. Moreover, enhanced Government support to the agricultural sector and higher commodity prices supported area and yield increases in some regions. In the northeast, however, the Boko Haram conflict has had a huge impact on agriculture as a result of the large‑scale population displacement and restrictions imposed on agriculture activities, leading to a sharp drop in planted areas in some states, notably in Borno State. Overall, the country’s aggregate cereal output in 2016 was tentatively estimated at about 22.6 million tonnes, 5 percent higher than the 2015 above‑average level.
Food and fuel prices remain high driven by weak currency and civil insecurity
Prices of domestically-produced coarse grains and tubers rose sharply in January after the good supplies from the recently-completed 2016 above-average harvest had put some downward pressure on prices late last year. The continuing steep depreciation of the local currency, civil insecurity and soaring transport costs were the main drivers behind the sharp regain in prices. The Nigerian Naira (NGN) has depreciated by more than 50 percent since early 2016, seriously affecting regional price trends and trade flows. Nigerian cereal exports to regional markets have increased, putting pressure on domestic food supplies. The weak currency has also supressed Nigerian demand for imports from neighbouring countries, affecting household income and food security, particularly in the Sahel countries that usually export livestock and cash crops to Nigeria. Moreover, the currency weakness and the removal of subsidies have also increased fuel prices and consequently transport costs which are reportedly up to 200-300 percent above average, exacerbating the costlier and reduced imports.
The Central Bank of Nigeria decided to allow the Nigerian Naira to float against the US dollar as of mid‑June 2016. The change in policy was aimed at harmonizing the official and parallel exchange rates. The measure follows critical foreign currency shortages and a significant depreciation of the Nigerian Naira on the parallel market caused by the decline in international oil prices. According to the International Monetary Fund, international crude oil prices fell by 25 percent over 2015, leading to a 40 percent drop in Nigerian exports and doubling the Government deficit. Domestic fuel prices increased by about 67 percent. Prices of imported and local foods also rose significantly.
High import dependency persists
In August 2016, the Government of Nigeria launched its new Agriculture Promotion Policy (APP) for 2016-2020. The APP is expected to build on the achievements of the Agricultural Transformation Agenda (ATA) implemented by the previous Government to reduce the country’s reliance on food imports. The ATA was implemented from 2012 to 2016 and focused on five key crops, including rice, sorghum and cassava. A number of import substitution measures were introduced to support domestic production, including the mandatory inclusion of 10 percent of cassava flour in bread. Input availability and access were also supported in the framework of the ATA, which aims to make Nigeria self‑sufficient in rice. The Central Bank of Nigeria also banned importers from accessing foreign exchange markets in 41 categories of items, including rice. The ban was partially lifted in October 2015, when imports through the land borders were once again allowed after the payment of appropriate duties and charges. However, these measures amplified informal cross border imports from neighbouring coastal countries resulting in the Nigerian Customs Service to reintroduce the policy to restrict rice imports through land borders as of 25 March 2016.
Nigeria remains a food deficit country with cereal imports (mostly rice and wheat) forecast to exceed 7 million tonnes in 2017. The country is still the largest rice importer in Africa.
Food insecurity reaches extreme levels in pockets of Nigeria’s Borno State
The continued conflict in the northern part of the country has resulted in widespread disruption in agricultural and marketing activities and has caused massive displacement. According to OCHA, about 1.8 million people have been internally‑displaced in the North East Region as of March 2017, while over 200 000 are refugees in neighbouring Niger, Cameroon and Chad. The conflict has left a significant portion of the population without access to adequate food, water and health services. According to the last Cadre Harmonisé (CH) analysis conducted in March 2017 in 16 out of 36 states, 7.1 million people (about 7.5 percent of the population analysed) face acute food insecurity and require urgent life-saving response and livelihood protection. Around 5.6 million people (6 percent) are in CH Phase 3: Crisis, 1.4 million (1.5 percent) in CH Phase 4: Emergency and 44 000 people in CH Phase 5: Famine (i.e. IPC Catastrophe). The majority of the severely food insecure people are concentrated in Borno, Adamawa, and Yobe states of northeast Nigeria with a total of about 4.7 million people. The Borno State alone accounts for about 3.3 million severely food-insecure people. In addition, countrywide, a further 17.8 million people (19 percent) are classified in CH Phase 2: Stress, requiring resilience-building interventions.
Projections indicate that, in case of the lack of an adequate and timely humanitarian response, the situation is likely to deteriorate during the next lean period (June-August 2017), with 7.4 million people expected to be in Crisis, 1.5 million in Emergency and 50 000 in Famine conditions, bringing the total number of severely food‑insecure people to 8.9 million. Although in recent months some territories in the most affected northeastern states have become accessible, trends show that food security and nutrition situation are worsening, especially in Borno State where the population in need of immediate humanitarian assistance (Phases 3 to 5) is expected to reach 3.6 million in August 2017, nearly 65 percent of the State population, including over 43 000 people expected to face Famine conditions (IPC Catastrophe).