From food to luxury: How Covid-19 is changing buying patterns in Nigeria
Four months into the Covid-19 crisis, Nigerian farmers are facing ever-increasing challenges in procuring farm inputs such as seeds and fertilizers. Not only are supplies scarce, but prices of imported inputs have skyrocketed due to fluctuations in dollar exchange rates caused by the global lockdown.
At the Mile 12 International Market in Lagos, Margaret (not her real name), a mother of two, is wondering how to maintain sales of her food items when days and hours of operations have been restricted, and the influx of consumers keeps going down.
Meanwhile, the CEO of a commercial agribusiness venture based in Lagos is contemplating how to meet the required monthly inputs of 100 tonnes of maize, as amidst the sharp rise in price, from a pre-pandemic average of 95 Naira per kilo to the current rate of 155 Naira.
These two scenarios depict the impact that the global shocks are having on day-to-day livelihoods, especially for small- and medium-sized enterprises in Nigeria.
Several reports and analyses from global institutions have shown that the pandemic is likely to have a significant threat on our global food systems, especially in Africa where food production systems are less diversified, and dependent on imports, as compared to the developed world.
In response to price fluctuations, and other food system challenges caused by the pandemic, Nigerians are changing their dietary and consumption behaviour to compensate for lower purchasing power, as well as changing market patterns.
Commodities prices amid the Covid-19 pandemic
In Nigeria, like many other African countries, the informal market provides an important source of livelihood for men and women. Over the past weeks of Covid-19 lockdown and restrictions, the food markets continue to deal with unprecedented shocks, affecting both the demand and supply of products.
The pandemic has disrupted the entire food supply chain, and caused significant shifts in production, demand and consumption patterns. Last month, I discussed the impact of Covid-19 on Nigeria’s poultry sector based on information gathered from poultry farmers. According to suppliers, sales of eggs and chicken have declined, as consumers are now scaling down their food choices to focus more on essential items like rice, garri and beans.
The AFEX Commodities Exchange report on Covid-19 and Commodities shows that in the last three-month period, soybean sales have witnessed the steepest decline, falling by 13.55%, while maize has fallen by 5.94%. Export crops such as ginger and cocoa, on the other hand, have remained relatively stable, even achieving increased sales, at 5.00% and 11.69% respectively.
In mid-June, I conducted a market survey with some informal traders in Lagos to understand price variations for food commodities before and during the Covid-19 era. The results show that prices of food, as well as some non-food items, have increased significantly since the pandemic. This is impacting on traders’ earnings due to the decline in demand from many consumers, most of whom have lost their jobs, or have had their income reduced due to the crisis.
By contrast, the market has seen an increase in prices of some essential commodities, such as rice, maize, bean and sugar. This is attributed to, among other factors, increased demand leading to less availability of key products, the inability of farmers to access their farms due to lockdown restrictions, the high cost of shipment and transportation, and the closure of some markets due to the insecurity crisis in the northern part of Nigeria where the majority of the grains and legumes are produced.
Other essential products, such as vegetable oil and tomatoes, have seen slight price increases due to a combination of higher demand, and temporary disruptions in the supply chain.
As we continue to deploy different means to address the unprecedented situation caused by Covid-19, there is a need to pay even more attention to stabilizing the country’s food systems, both on the demand and supply sides.
From price regulations of food and agro-commodities to input and investment support systems, the government must play its role and work with farmers, traders, commodity associations and private sectors to keep the food supply chain afloat.
Also, price regulations must consider food accessibility and affordability for consumers, especially vulnerable households.
Written by John Agboola
This article is part of Covid-19 Food/Future, an initiative under TMG ThinkTank for Sustainability’s SEWOH Lab project (https://www.tmg-thinktank.com/sewoh-lab). It aims at providing a unique and direct insight into the impacts of the Covid-19 pandemic on national and local food systems. Also follow @CovidFoodFuture, our Video Diaries From Nairobi, and @TMG_think on Twitter. Funding for this initiative is provided by BMZ, the German Federal Ministry for Economic Cooperation and Development.
