The prices of staple food items in Nigeria have reached unaffordable levels for many consumers, according to the Nigeria Bureau of Statistics (NBS). In April 2023, the food inflation rate was reported at 24.61 percent year-on-year, a significant increase from April 2022 (18.37 percent). The rise in food inflation was attributed to price hikes in various categories, including oil and fat, bread and cereals, fish, potatoes, yam, fruits, meat, vegetables, and spirits. The core inflation rate, which excludes volatile agricultural produce, stood at 20.14 percent in April 2023, compared to 14.18 percent in April 2022.
Factors contributing to the surge in food prices were identified as Naira scarcity, movement restrictions during general elections, and high transportation costs. Vendease, a Nigerian food procurement startup, highlighted the price increases in specific food items such as basmati rice, tomatoes, sweet potatoes, and egusi. Cash shortages due to the naira redesign policy and limited movement of food supply trucks from the north were cited as key reasons behind the price hikes.
General increment in utility and fuel prices also affected the overall prices of goods and services. The National Bureau of Statistics reported that food prices rose for the second consecutive month, reaching 24.35 percent in February 2023. This upward trend in food prices contributed to a 17-year high headline inflation rate of 21.91 percent in February.
A survey conducted by Daily Independent in markets across Lagos showed spiraling prices, particularly since the easing of COVID-19 restrictions. Prices of various foodstuffs, including rice, beans, and yam, experienced significant increases.
Traders suggested that the security situation across farms, especially in the northern part of the country, needed to improve to alleviate the price hike. Until then, consumers might have to adjust to the higher prices.
Additionally, some traders emphasized the need to sell stocked items purchased at higher prices, indicating that relief for consumers would depend on these factors.
Despite the challenging circumstances, economist and businessman Mr. Chris Iwuchukwu expressed hope that the recent interest rate hike by the Central Bank of Nigeria (CBN) to 18.5% could potentially decrease the prices of food items.He believed that the tightening of monetary policy and controlling inflation would benefit the economy in the long run, allowing small businesses and SMEs to plan more effectively.
In conclusion, Nigerians may need to adapt to the current situation of high food prices as immediate relief seems unlikely. However, there are hopes that the measures taken by the CBN and improvements in the security situation could lead to stability and affordability in the future.
