Dr. Muda Yusuf urges government to balance consumer relief with farmer income protection amid rising import pressures
Nigeria’s recent moderation in food prices has sparked a fresh policy debate, with the Centre for the Promotion of Private Enterprise (CPPE) warning that the gains enjoyed by consumers may be coming at a heavy cost to farmers, rural livelihoods and long-term food security.
In a policy paper released on February 1, 2026, CPPE Chief Executive Officer, Dr Muda Yusuf, said the Federal Government’s current food security strategy has produced unintended trade-offs, noting that while households are benefiting from cheaper food, investors and producers across the agricultural value chain are suffering losses from sharp commodity price collapses.
Yusuf acknowledged that the decline in food prices and easing food inflation have delivered real welfare gains for Nigerian households. However, he warned that the impact on farmers’ incomes and investment confidence poses a serious threat to the sustainability of agriculture, one of Nigeria’s most strategic economic sectors and largest employers of labour.
According to him, Nigeria now faces a critical policy dilemma: how to keep food affordable for consumers without undermining farmer incomes or discouraging investment in agriculture.
He argued that the country cannot afford a policy environment that weakens confidence in farming, especially at a time when agriculture remains central to livelihoods, rural employment and national economic stability.
Import surge blamed for market dislocation
Yusuf attributed the recent collapse in prices of key staples such as rice, maize and soybeans largely to increased food imports introduced as an emergency response to high food prices. While the imports helped ease inflationary pressures, he said they also triggered serious dislocations within the domestic agricultural investment ecosystem.
He warned that although consumers may welcome falling prices in the short term, the long-term effects could be damaging, as lower farmer incomes reduce incentives to produce, weaken investment appetite and increase the risk of future food shortages and price spikes.
Beyond imports, Yusuf identified structural weaknesses that repeatedly destabilise farm prices, including harvest-time gluts, inadequate storage facilities, weak rural logistics, poor road networks, insecurity and limited agro-processing capacity.
“These conditions force farmers to sell immediately after harvest, regardless of market prices,” he noted, adding that the cycle typically results in low prices during harvest periods and sharp increases months later when supplies decline.
Call for farm price stabilisation framework
To address the challenge, Yusuf called for the urgent establishment of a National Farm Price Stabilisation and Farmer Income Protection Framework, describing it as essential to restoring confidence in agriculture and ensuring long-term food security.
He said the framework should be rules-based, market-friendly and targeted, rather than discretionary or overly interventionist. According to him, the focus should be on correcting market failures in storage, logistics, finance, processing and market information, rather than crowding out private sector participation.
As part of the framework, Yusuf proposed the introduction of minimum guaranteed prices for selected priority crops, including maize, rice (paddy), sorghum and soybeans. He explained that such price floors would serve as a stabilising backstop to protect farmers against severe price crashes, rather than an open-ended government procurement programme.
He stressed that support prices must be transparently determined, taking into account production costs, logistics expenses and a fair margin for farmers, while warning that price guarantees without adequate storage capacity and institutional discipline could become fiscally unsustainable.
Grain reserves, warehousing and liquidity gaps
Yusuf also called for urgent reform of Nigeria’s strategic grain reserves, recommending a shift to a professionally managed buffer stock system that allows government to buy during harvest periods and release stocks during lean seasons to stabilise prices.
He highlighted the lack of liquidity among farmers as a major driver of distress sales, urging nationwide expansion of the warehouse receipt system. Under such a system, farmers would be able to store produce in certified warehouses and use receipts as collateral for loans, allowing them to sell when prices improve.
According to him, scaling the system would also improve commodity standards, enhance transparency and support structured commodity trading.
Processing, logistics and institutional demand
The CPPE chief further emphasised the need for investment in storage infrastructure, cold-chain systems and agro-logistics, noting that farm price stabilisation is impossible without addressing these deficits.
He also identified weak processing capacity as a key contributor to price collapse, arguing that when processing is strong, surplus produce is absorbed rather than dumped on open markets. He urged government to support processing clusters near production zones, particularly in rice milling, soybean crushing, cassava processing, tomato paste and animal feed production.
In addition, Yusuf said government could stabilise markets by using institutional demand strategically, linking farmers and aggregators to school feeding programmes, emergency relief operations, military supply chains and public hospitals, provided procurement is transparent and locally sourced during harvest periods.
Insurance, trade safeguards and input costs
Beyond price stabilisation tools, Yusuf called for stronger agricultural insurance schemes, including weather-index and revenue insurance pilots to protect farmers against yield and price shocks.
He also stressed the importance of predictable trade safeguards to prevent import-driven price crashes, while complying with regional trade obligations, alongside better enforcement of quality standards at borders.
Reducing the high cost of farm inputs, including fertilisers, seeds, agrochemicals, machinery and financing, was identified as another critical pillar of sustainable food security. Yusuf said lower input costs and access to single-digit loans would improve productivity and reduce production costs across value chains.
Balancing affordability and sustainability
Yusuf concluded that Nigeria’s agricultural transformation cannot succeed without stabilising farmer incomes, warning that persistent price collapses would eventually undermine food security and worsen rural poverty.
He urged the Federal Government, state governments, development finance institutions and private investors to work together to establish a transparent, fiscally sustainable and market-oriented framework that protects farmers while keeping food affordable for Nigerian households.
According to him, a stable agricultural market would not only safeguard farmer livelihoods but also help moderate inflation, expand rural employment and strengthen Nigeria’s long-term economic resilience.
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