Nigeria’s economic woes deepened in December 2024 as food inflation reached a staggering 39.84%, a significant 5.91 percentage point increase from the previous year. This alarming figure underscores the mounting pressure on households across the nation, particularly those with limited incomes.  

The Consumer Price Index (CPI) report released by the National Bureau of Statistics (NBS) revealed a grim picture, with key food staples such as yam, potatoes, rice, and cereals experiencing dramatic price increases. This surge in food prices has disproportionately impacted vulnerable populations, exacerbating food insecurity across the country.

Regional Disparities Highlight Uneven Impact

The impact of food inflation has not been uniform across the country. Sokoto state recorded the highest food inflation rate at a staggering 57.47%, followed by Zamfara (46.39%) and Edo (46.32%). These figures highlight the severe regional disparities in food price increases, emphasizing the need for targeted interventions to address the unique challenges faced by different regions.

Core Inflation Accelerates, Adding to Economic Pressure

Beyond food inflation, core inflation, which excludes volatile agricultural produce and energy prices, also reached concerning levels, hitting 29.28% in December 2024. This represents a significant 6.21 percentage point increase from the previous year.

Read Also: Headline Inflation in Nigeria Surges to 34.80%, Food Prices Remain a Major Driver

The rise in core inflation was primarily driven by escalating transportation costs, including taxi fares and intercity bus journeys. Furthermore, rising costs in restaurant meals and personal care services contributed significantly to the overall increase.

Month-on-Month Trends Offer Mixed Signals

While the overall inflation picture remains grim, month-on-month data revealed some signs of moderation. Food inflation showed a slight decrease to 2.66% in December from 2.98% in November 2024. This modest improvement was attributed to decreasing prices in select categories, including local beer, fruit juice, and some staple foods.

However, core inflation’s month-on-month rate increased to 2.24% in December from 1.83% in November, indicating accelerating price pressures in non-food sectors. This trend suggests that while some aspects of inflation may be stabilizing, the overall economic outlook remains challenging.

Regional analysis further underscores the complex nature of the inflation crisis. While some states experienced severe food inflation, others showed relative stability. Notably, Ogun (34.24%), Rivers (35.43%), and Kwara (35.58%) recorded the lowest food inflation rates, though these figures remain at concerning levels.

The twelve-month average food inflation rate stood at 39.12%, representing an 11.16 percentage point increase from December 2023’s 27.96%. This persistent upward trend is a stark reminder of the deepening food security challenge facing the nation.

Similarly, the twelve-month average core inflation rate reached 27.15%, up by 6.39 percentage points from the previous year. These figures highlight the pervasive nature of price increases across both food and non-food categories, posing significant challenges for policymakers.

If You Ask Me

The widespread nature of price increases across both food and non-food categories, coupled with significant regional variations, presents complex challenges for policymakers. Addressing these challenges requires a multifaceted approach that includes:

• Strengthening agricultural production: Investing in agricultural infrastructure, improving access to quality seeds and fertilizers, and supporting smallholder farmers are crucial for boosting food production and stabilizing food prices.
• Improving transportation infrastructure: Enhancing road networks and logistics can help reduce transportation costs and ensure the timely delivery of food to markets.  
• Implementing targeted social safety nets: Providing support to vulnerable households through social safety nets can help mitigate the impact of rising food prices and ensure food security.  
• Addressing supply chain bottlenecks: Identifying and addressing bottlenecks in the food supply chain can help improve market efficiency and reduce price volatility.  
• Implementing effective monetary policy: The Central Bank of Nigeria must carefully calibrate monetary policy to address inflationary pressures while supporting economic growth.

The fight against inflation requires a coordinated effort from the government, the private sector, and civil society. By implementing comprehensive and effective policies, Nigeria can mitigate the impact of rising prices, ensure food security for its citizens, and foster sustainable economic growth.