CEM REPORT, AGROFOOD | Nigeria’s kitchens are feeling the heat of soaring inflation, with sales of everyday essentials like rice and pasta plummeting to a five-year low. This stark picture painted by Euromonitor International’s “Staple Foods in Nigeria” report reveals a nation struggling to fill its plates as wallets grow lighter.
“Staple foods are the backbone of Nigerian households,” explains the report, Yet, despite their essential status, sales volume in the formal market dropped for the second year running, falling from 2.57 million tonnes in 2022 to a meager 2.47 million tonnes in 2023.
From breakfast cereals to yams, consumption dropped across the board last year. Processed fruit and vegetables shrank by 8%, baked goods dipped by 5%, and even rice, pasta, and noodles took a 3% hit. The report highlights a painful truth: Nigerians are rationing essentials while sacrificing less crucial indulgences like cakes and processed meats.
The Culprits
“Poor economic conditions, exceptionally high inflation, and limited consumer spending power” are the culprits, the report says. Nigerians are being squeezed, forced to ration essentials or seek cheaper, often unpackaged alternatives.
Over the past seven months, inflation has skyrocketed to an 18-year high, fueled by government reforms like fuel subsidy removal and naira devaluation. The National Bureau of Statistics paints a grim picture: food inflation at 32.84%, a kilogram of local rice costing 74% more than last year, and a 500g loaf of bread nearly five times its price just 12 months ago.
The World Bank paints an even starker portrait. Their Nigeria Development Update reveals a shocking: 14.2 million Nigerians plunged into poverty between January and November 2023, with rising inflation a key culprit. This means 104 million Nigerians, nearly half the population, now struggle to make ends meet.
Food prices, a major driver of inflation, are also at their highest in 18 years. A kilogram of local rice now costs nearly double what it did in 2022, while a loaf of sliced bread has quadrupled in price. The price hikes extend to basic necessities like eggs, chicken, and even yams.
“Economic conditions worsened in 2023,” the Euromonitor report grimly states. Demonetization policies and fuel price hikes have exacerbated the inflation crisis, forcing Nigerians to spend more on essentials like fuel, leaving even less for food.
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The consequences are devastating. The World Bank estimates that rising inflation and sluggish economic growth pushed an additional 14.2 million Nigerians into poverty in 2023 alone, bringing the total to a staggering 104 million.
Further Food Hike in Nigeria
The outlook for 2024 is far from comforting. The Food and Agricultural Organization and World Food Program predict further price hikes for staple foods across West Africa, including Nigeria. The region faces a perfect storm of production deficits, trade restrictions, Sahel insecurity, and currency depreciation.
“Staple prices currently remain above the five-year average across the region. This is attributable to a combination of factors including production deficits, trade restrictions, insecurity in the Sahel, elevated global prices, high transaction costs, and currency depreciation in the coastal countries of the Gulf of Guinea,” it said.
Government initiatives like targeted cash transfers offer some relief, but a long-term solution demands a multi-pronged approach. Tighter fiscal and monetary policies are crucial to curb inflation, while bolstering domestic food production can shield against external shocks.
Nigeria’s battle against the rising tide of inflation is far from over. Empty plates and burdened wallets tell a story of struggle and resilience. The time for action is now. Only by addressing the root causes of this crisis and implementing sustainable solutions can the nation ensure its kitchens are once again filled with the aroma of hope and prosperity.
