The central bank of Nigeria (CBN) has disbursed the sum of N41 billion to wheat farmers amid the Russian-Ukraine war to cushion the effect of the war.
These farmers were given these intervention funds to aid production as the availability of the wheat dropped drastically in the country due to the impacts of the Russia and Ukraine war.
The Central Bank of Nigeria (CBN), through Heritage Bank, aided in disbursing the funds. Heritage Bank Executive Director, Oko-Oboh while speaking at the Chartered Institute of Bankers of Nigeria’s (CIBN) 15th Annual Banking and Finance Conference, tagged “Repositioning the Financial Services Industry for an Evolving Global Context”, stated that the Bank had to partner with the CBN to support wheat farmers to enable the growth of wheat in the country following the setback faced in the importation of the staple crop.
Tekedia Mini-MBA edition 14 (June 3 – Sept 2, 2024) begins registrations; get massive discounts with early registration here.
Tekedia AI in Business Masterclass opens registrations here.
Join Tekedia Capital Syndicate and invest in Africa’s finest startups here.
He said, “As a Bank, we partnered CBN and other stakeholders such as wheat farmers association of Nigeria, wheat farmers, processors and marketers’ association of Nigeria, Lake Chad Research Institute and other development partners, flour mills of Nigeria, and several seed companies and others to support over 100,000 farmers in wheat production.”
He further stated, “Also, Heritage Bank further factored consideration of value addition of financial services and products flowing to and/or through value chain participants to address and alleviate constraints to growth that have distorted product financing, receivables financing, physical-asset collateralization, risk mitigation products, and financial enhancements.”
Wheat is one of the most consumed staples in Nigeria, as the value chain is quite large that it can be processed into a wide range of foods including bread, crumpets, muffins, noodles, pasta, biscuits, cakes, pastries, cereal bars, sweet and savoury snack foods, crackers, crisp-breads, sauces, and confectionery.
Wheat was Nigeria’s third most imported product in 2019, as according to the observatory of Economic complexity, Nigeria’s import of $1.48 billion worth of wheat in 2019 made it the world’s 6th largest importer of the cereal grain that year with its two top sources from the US, and Russia.
Due to Nigeria’s dependence on imports to satisfy growing wheat consumption, it faced its biggest challenge this year due to Russia’s invasion of Ukraine as 30 percent of the world’s wheat exports were cut off from the global market.
As the war intensified, in the last few months, wheat-based products such as the popular pre-packed wheat flour and bread (sliced and unsliced) have witnessed a steady price increase across the country.
Nigeria and other import-reliant countries, therefore, had two options to either invest massively in critical infrastructure in states where it has competitive and comparative advantage to boost wheat production or look elsewhere away from Russia and Ukraine to import wheat.
With the recent disbursement of N41 billion naira by the CBN to wheat farmers in the country, it will cushion the impact of the Russian-Ukraine war as it will aid in Wheat availability, thereby ensuring stability it the prices of wheat products.