AFEX projects grains price stability

Amid Nigeria’s ongoing food inflation crisis, AFEX has projected price stabilization for key staple grains—including maize, soybean, paddy rice, and sorghum—as the government implements a 150-day import duty waiver on maize. This policy move is expected to boost supply and ease market pressure, moderating prices over time.

According to the 2025 Annual Commodities Outlook Report released by AFEX, Nigeria’s inflation rate soared to 34.8% in December 2024, exacerbated by exchange rate volatility, climate change effects, rising input costs, and low agricultural productivity. The report tracks commodity price trends, production performance, and key market projections, offering stakeholders critical insights into the opportunities and risks within the agricultural value chain.

Commodity Market Trends and Projections

1. In 2024, global maize production hit a record-breaking 1.13 billion metric tonnes, increasing by 6% year-on-year. This led to a 25% price drop in international maize prices.
2. However, in Nigeria, maize prices surged by 92% year-on-year, closing at approximately ₦660,000 per metric tonne, peaking at ₦908,000 per metric tonne in July 2024 due to local market constraints.
3. Paddy rice prices rose by 6% globally, driven by India’s export restrictions, seasonal supply shortages, and the impact of El Niño on rice production.
4. Despite a 16% global decline in grain prices, Nigeria’s agricultural sector continues to struggle with fragmented supply chains and underinvestment, making local price stabilization a challenge.

Speaking on the report’s findings, AFEX Nigeria’s President & CEO, Akinyinka Akintunde, highlighted the urgency of mitigating climate risks, optimizing input costs, and improving productivity to combat food insecurity. He emphasized the need for coordinated policy actions and private sector-driven innovations to stabilize the sector.

Additionally, MITSUN Group’s Executive Chairman, Ikenna Egbukole, stressed that climate volatility, supply chain inefficiencies, and limited agricultural investment require urgent interventions through policy reforms, capital market engagement, and private-sector innovations to enhance resilience across Nigeria’s agricultural ecosystem.
Source- Punch

Expert Review for Agri-Food Stakeholders
Navigating Nigeria’s Grain Market: Opportunities and Challenges for Stakeholders
The 2025 AFEX Commodities Outlook presents a mixed market outlook for Nigeria’s agricultural value chain, with both opportunities and risks for stakeholders. While the 150-day maize import duty waiver could ease short-term price pressures, long-term stability will depend on structural reforms and investment in local production.

Key Considerations for Agribusiness Players:

1. Short-Term Relief, Long-Term Uncertainty
   – The maize import duty waiver will increase supply, but exchange rate fluctuations and logistics constraints may limit its full impact.
   – Farmers and processors should leverage short-term price stabilization to secure inputs and strategize for the next planting cycle.
2. Climate and Supply Chain Risks
   – El Niño-driven disruptions and India’s rice export policies highlight the vulnerability of Nigeria’s food supply to external shocks.
   – Stakeholders must invest in climate-smart agriculture and alternative sourcing strategies to diversify supply chains.
3. Investment and Policy Interventions Needed
   – The capital market is underutilized in financing agribusiness growth.
   – Policymakers must implement incentives for agricultural financing, such as commodity-backed securities and warehouse receipt systems.
4. Leveraging Technology and Innovation
   – Digital platforms for commodity exchange and supply chain optimization can improve price transparency and efficiency.
   – Investment in agritech solutions such as AI-driven market analytics, IoT-based logistics, and climate adaptation tools will drive sector growth.

Strategic Outlook for Stakeholders

1. Government & Policymakers: Strengthen local production, enhance market infrastructure, and stabilize trade policies to mitigate reliance on imports.
2. Farmers & Agro-Producers: Adopt resilient farming techniques, explore contract farming models, and integrate storage and processing solutions to reduce post-harvest losses.
3. Investors & Private Sector: Leverage commodity-backed financial instruments, expand investment in agro-processing, and explore cold chain logistics to enhance supply chain efficiency.

With inflationary pressures persisting, agribusiness stakeholders must take proactive measures to ensure food security, market stability, and long-term sector sustainability. The 2025 AFEX report provides a roadmap for informed decision-making, but stakeholders must act decisively to translate insights into tangible growth opportunities.