Herdsmen attacks, FX scarcity compound manufacturers’ woes – Businessday

Prolonged attacks by rampaging herdsmen, along with foreign exchange scarcity, have worsened the plight of Nigerian manufacturers who are already facing a myriad of crises.

The herdsmen recently attacked Benue, Enugu, Bayelsa, Ekiti and Adamawa, among others, sacking farmers and destroying agro raw materials such as oranges, mangoes, pineapples, cassava, pears, tomatoes, grains, oil seeds, wheat and other commodities that serve as inputs for manufacturers in the food and beverage industry.

Some fruit juice and starch manufacturers in Benue who often sourced oranges, pine apples, cassava and yam from Agatu and its neighbours say they now have to source raw materials from outside the crisis area, prompting them to spend more on inputs.

“The crisis has implications for the agricultural sector and employment generation. It is a major risk to the growth of the sector,” said Muda Yusuf, director -general, Lagos Chamber of Commerce and Industry.

“This is also a threat to raw materials for industries. The agric sector provides the raw materials that feed the industries, especially the food and beverage industries in a period of FX shortage,” said Yusuf.

The foreign exchange crisis in the economy has also cut industrial inputs, as manufacturers struggle to import the needed inputs, owing to their inability to get foreign exchange at the official rate.

“We are facing a problem sourcing raw materials, owing to the foreign exchange situation. This is a challenge for us,” said Kemi Ajibade, head of human resources at Lucjy Fibres Limited, manufacturers of rugs and carpets.

“We hope something could be done so that we can get forex at the official rate,” Ajibade told Aisha Abubakar, minister of state for industry, trade and investment on Monday.

According to a Mercy Corps 2015 report, Nigeria loses about $2.3 million (N453 million) annually to herdsmen’s attacks. States where the conflicts take place lose an average of 47 percent of tax generated internally.

Herdsmen attacks and forex crisis have combined with other negative indicators to cut IMF’s growth forecast in Nigeria, Africa’s biggest economy and oil exporter, to 2.3 percent.

Oil price crash has forced Nigeria’s Central Bank to adopt capital control measures, which have forced the bank to restrict importation of certain industrial inputs.

The entire situation threatens to derail President Muhammadu Buhari’s plan to broaden the economy through agriculture. The agricultural sector contributed 23 percent to the country’s GDP in 2015. Trade and crop production were the main drivers of growth in the non-oil sector, according to data obtained from the National Bureau of Statistics (NBS).

Analysts say the herdsmen’s attacks will further reduce farmlands, as well as farmers’ income while also impacting on food security.

“Crop production and farmers’ productivity will be reduced, which in turn will cut down profits, thereby affecting the livelihood of farmers,” said Micheal Oluwole Ajala, professor of Seed Technology, Federal University of Agriculture, Abeokuta (FUNAAB).

Ajala said added that “The government needs to create grazing areas if they are serious about diversifying through agriculture.

Nigeria has an estimated 19 million heads of cattle, valued at over N1.9 trillion.

Given the huge economic potential of cattle, experts have suggested measures with which to reduce herdsmen attacks in the country.

Some say it is important to build ranches but add that this should be undertaken by individuals as cattle rearing is a private business. Others add their voices.

“Within the confines of [the ranch], the animals can be sustained. You will be sure you can get feed and water for them, providing all these within the ranch. This will minimise the movement outside the ranch in search of water and feed, in the course of which destruction of farmlands and communal clashes occur,” said Chryss Onwuka, professor of ruminant animal nutrition and president of the Nigerian Society for Animal Production.

“In their [nomadic herdsmen] tradition, once their fields start thinning out and water becomes less available, they start moving towards regions where there is enough food and water. All these tell on their [cattle] energy which in turn reflects on their weight gain; bringing about weight loss which they had hoped to improve by moving. “The little potential they have for weight gain is lost in the course of transiting from one place to another. If they were sedentary, then their restricted movement would have translated into weight gain,” Onwuka said.

Olufemi Onifade, professor of Forage and Agronomy, explained that “for those who may want to go into cattle ranching, it is an encompassing business which requires a large area of land, depending on the number of animals likely to be kept.

“When the land has been acquired, it is important to have feed for the animals. They can provide feed though pasture growing through grasses. They can plant the grasses, depending on the number of animals and the grazing method they want to adopt.”

Onifade further explained that “there is the complimentary model where sown pasture may not be the sole source of feed. People can plant maize, and after harvesting the corns, it can be conserved for animals during the off-season. Some private farms produce the maize but will not allow the crops to mature for human consumption before they will preserve it for the animals. Some may take off the corns and immediately they have done that, they preserve the remnant; however, it may not be as high quality as the one that cubs in it.”

ODINAKA ANUDU, JOSEPHINE OKOJIE & CALEB OJEWALE