Reports have revealed that a letter from the Poultry Farmers Association of Nigeria was the trigger for the recent decision by the Central Bank of Nigeria (CBN) to approve emergency importation of 262,000 tons of maize into Nigeria.
Nairametrics confirmed this, after sighting the letter signed by the President of Poultry Farmers Association, Onallo S. Akpa, dated July 3rd, 2020.
In the letter, the association called on President Buhari to allow for guided importation of maize, in order not to shut down the poultry industry in Nigeria, since poultry farmers rely heavily on maize to feed their chickens.
As part of efforts to keep their businesses alive, they demanded the following:
- The FG should instruct the Federal Ministry of Agriculture & Rural Development, to release 300,000Mt of maize and 10,000Mt of soyabeans to the association, at subsidized rates, in order to keep the poultry industry going.
- A guided importation of maize in order not to shut down the entire poultry industry in Nigeria. They specifically requested for a Feed Grade Maize of 2,100Mt and soyabeans meal of 10,000Mt.
- Poultry farmers will be the ones to import the maize and soyabean meal themselves, which they will make available to their members.
- That the importation will serve their needs for 5 months.
- That the FG should make available $70 million in forex at the prevailing exchange rate, for the importation of Feed Grade Maize and soyabeans.
- Import duty and VAT exemptions to sustain the poultry production business, and stabilize protein supply for the country.
- Halt the export of ‘critical commodities’ to neighboring countries, in order to ensure food security for Nigerians.
The motive for CBN’s import Ban
The Central Bank, in July, adding to its list of 41 ban items, announced a ban on forex for maize importation into the country, so local farmers could compete. It is unclear if the CBN was privy to this letter when the circular was issued on July 13th, 2020.
However, soon after the ban was announced, criticisms poured in against the CBN directive.
The CBN has also heavily invested in agriculture, through several intervention funds directed at farmers. A source at the CBN, informed Nairametrics that the quantum of investments in the sector was a major factor in deciding on the import ban.
The apex bank has resorted to restriction of access to forex as a monetary policy tool, to dissuade importation of items that compete directly with locally produced substitutes, backed by intervention programs.
Since last year, the Federal Government has closed the country’s borders to the importation of goods, piling pressure on Nigeria’s trade and jacking up inflation. Nigeria’s food inflation has risen to 15.48% as of July 2020, on the back of several policy measures of the government.