Access Bank PLC

Why prices of tomatoes, pepper are increasing

First Bank Nigeria

Tomato fruit prices are skyrocketing across the country on account of delayed seasonal rains, inadequate off-season irrigation planning, a rising and ebbing fuel scarcity , and roads in disrepair.

Consumers  have thus turned to buying up stocks of  canned tomato puree, causing highier than expected sales in that segment. External economies are however benefiting most from this development, as most canned tomato products are imported.

Tomatoes constitute 18 percent of all vegetables consumed by the Nigerian populace, according to a research  by the Agricultural Economics department of the University of Ibadan.

Early in 2014, Sanusi Lamido Sanusi, then governor of the Central Bank of Nigeria (CBN), expressed concern about Nigeria’s N16 billion  annual import bill on tomato pastes. This, he said, was due to very high demand for tomatoes in the country, which unfortunately, the farmers could not provide because of poor storage methods.

This year’s price increase has reached an unusual high of N30,000 for a 50kg basket of tomatoes at the Mile 12 market – a major farm produce hub in Lagos.

The 50kg basket usually sells for between N3,000 and  N5,000 in the first quarter of the year, but mid-year, during the rains, it goes for between N10,000 and N17,000.

The yearly rains which typically kick-off in April, started two months late, this year (in June).As such, by the time the old harvest of tomatoes was exhausted, the crop in the field had not matured.

The price of the 50kg basket usually swings between N3, 000 and  N5,000 but mid-year during the rains, it progresses to between N10,000 and N17,000.

Last year, the Boko Haram insurgency which is now abating, contributed  to the N17, 000 per basket peak. But this year, as at  Friday last week, tomato prices reached N27,000 to N30,000.

The current fuel scarcity in the country has also impacted on the hike in tomato prices, market sources say.

Afioluwa Mogaji, a veteran farmer and chief executive, X-ray Farms Consulting, said if the rains had commenced in April, farmers in  the Southwest would have started planting tomatoes at the beginning of the fourth month, while farmers in the north would sell their last stock of tomatoes, after which the prices would begin to go up in May.

Mogaji added that by June, on some dry days during the heavy rains, some farmers would have begun to harvest. He further stated that though there would still be  scarcity and high prices, it would not be as biting  as it is now.

Mogaji said apart from climate change, lack of government funding in the Southwest for dry season irrigation is a contributing factor . He added, “The government funding for dry season farming for the northern states stops at the end of the first quarter of the year, by which time farming is expected to commence in the south.”

He further added that if there had also been funding for massive irrigation in the south, then whenever rains are delayed in April, which is the case in recent years, then farmers in the South would still commence planting and we would not have this scarcity, not only of tomatoes but other crops such as maize.”

He also observed that some state governments were neglecting already available greenhouse technology infrastructure which would have lessened the scarcity of tomatoes.

He said “There is a greenhouse nursery in one south-west state that can raise over three million seedlings of tomatoes per year in addition to a massive tomato  processing plant but they are lying fallow. The current state government has not shown interest in activating these projects, probably because the facilities were installed by the previous administration of the state.”

The Industrial Development Group, which installed the facility has written proposals to the current state government to concession it as a Public Private Partnership (PPP) project with private sector funding but the state government has not yet responded, he said. Mogaji  further explained that if each of the three million tomato seedlings produces 3kg of tomatoes (it can produce more), the state would be realising  nine million kg of tomatoes, which is about 180,000 baskets of  50kg. If sold at N15,000 at this period of scarcity, the state would realise N2.7 billion lessening the problem in the southwest.

Some industry watchers also raised health concerns on these heavy  imports of tomato pastes. Apart from health concerns, they note that it drains foreign exchange and exports jobs that Nigeria direly needs to

provide for its teeming unemployed citizens.

Speaking on other causes of the scarcity and price hikes, Obiajuru Igborgbor Luya of Novus Agro Commodity Index, a food prices research firm, said, “During the rainy season, the rains aggravate the poor

condition of the roads. This causes delays or accidents and some of the tomatoes and peppers which are very highly perishable foods are lost, so the quantity that gets to the destinations are relatively smaller and  this causes price hikes.”

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button