Federal Ministry of Agriculture and Water Resources, Federal Republic of Nigeria

Federal Ministry of Agriculture and Water Federal Ministry of Agriculture and Water Resources, Federal Republic of NigeriaResources, Federal Republic of Nigeria

Dr. Sayyadi Abba RumaDr. Sayyadi Abba RumaHon. Minister of Agriculture and Water ResourcesHon. Minister of Agriculture and Water Resources

Federal Republic of NigeriaFederal Republic of Nigeria

INVESTMENT OPPORTUNITIESINVESTMENT OPPORTUNITIES

ININ

NIGERIAN AGRICULTURENIGERIAN AGRICULTURE

VAMED ENGINEERINGVAMED VE REFERENCES

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Contents of Presentation

Pages

1. Introduction: Overview of Nigerian Agro-Economy: 2-4

2. Agriculture in Nigeria: Constraints and Challenges: 5

3. Opportunities for Investors: 6-11

4. Commercial Agriculture Development Programme: 12-18

5. Conclusion: 19-21

INVESTMENT OPPORTUNITIES IN NIGERIAN INVESTMENT OPPORTUNITIES IN NIGERIAN AGRICULTUREAGRICULTURE

1Federal Ministry of Agriculture and Water Resources, Federal Republic of Nigeria


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NIGERIA – THE COUNTRYNIGERIA – THE COUNTRY

Federal Ministry of Agriculture and Water Resources, Federal Republic of Nigeria

LAND – 923,77OKm2 36 STATES + FED CAPITAL TERRITORY

773 LOCAL GOVERNMENT COUNCILS

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OVERVIEW OF NIGERIAN AGRO-ECONOMYOVERVIEW OF NIGERIAN AGRO-ECONOMYAGRO-ECOLOGICAL RESOURCESAGRO-ECOLOGICAL RESOURCES

TOTAL LAND AREA - 92.4 MILLION HA.

TOTAL AGRIC. LAND - 79 MILLION HA.

TOTAL CULTIVATED LAND - 32 MILLION HA.

NO. OF FARM FAMILIES - 14 MILLION /(20 MILLION)

AVG. LAND AREA/FARMER - 1.8 HA

SURFACE WATER - 267 BILLION CUBIC METERS

UNDERGROUND WATER - 57.9 BILLION CUBIC METERS

ANNUAL RAINFALL RANGE - 300MM – 4000MM

POTENTIAL IRRIGABLE AREA - 3.14 MILLION HA

IMMENSE ARRAY OF NATURAL RESOURCES

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NATIONAL POPULATION - 140 MILLION

FOOD INSECURE POPULATION - 90 MILLION (65%)

OVERALL GDP GROWTH - 6.3%

AGRIC CONTRIBUTION TO GDP - 42% (2007), 50% (2008)

EMPLOYMENT - 66% OF WORKFORCE

AVERAGE FERT CONSUMPTION - 100gm / Ha

AVERAGE FERT DEMAND/YEAR - 3 MILLION TONNES

TRACTOR DENSITY - 1/1,000 Ha

AVG. CEREAL CROP YIELD - 1.2 TONNES/Ha

EXTENSION SERVICES RATIO - 1/12,000 FARM FAMILIES

CERTIFIED SEED USAGE - 2% OF REQUIREMENT

POST HARVEST LOSS AVG. - 70%

LENDING TO AGRIC SECTOR - 17.5% - 2002 , 4% - 2007

OVERVIEW OF NIGERIAN AGRO-ECONOMY OVERVIEW OF NIGERIAN AGRO-ECONOMY SECTORAL STATISTICS SECTORAL STATISTICS



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Sector dominated by small-holder farmers with average holdings less than 1.5 ha

Productivity generally low (2t/ha) - Low technology usage

- Poor agronomic practices

- Inadequate access to modern inputs

- Insufficient access to credit

- High dependence on rain fed farming

- Subsistence farming culture

- Inadequate roads and other critical infrastr-

ucture vital to the sector

Low level of value addition due to poor power infrastructure

Sector shackled by financial, technical and managerial constraints

Strong history and culture of agri-food marketing but poor market infrastructure

Huge growth potential in local/regional markets for agricultural produce/raw materials

Large pool of skilled and semi-skilled human resources

AGRICULTURE IN NIGERIA: AGRICULTURE IN NIGERIA: CONSTRAINTS AND CHALLENGESCONSTRAINTS AND CHALLENGES

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OPPORTUNITIES FOR INVESTORSOPPORTUNITIES FOR INVESTORS(3(3))

CASH CROPS - Cotton, Oil Palm, Fruit Trees, Rubber, Sugar Cane and Jatropha carcus;

FOOD CROPS - Rice, Wheat, Cassava, Maize/Soya beans/Millet Tomatoes and Vegetables (including medicinal plants);

POULTRY – Broilers, Eggs and Poultry Feed Production;

LIVESTOCK – Dairy (Milk) Development and Abattoir (Meat) Enhancement Programme, Cold Chain Development, Meat Processing, Animal Feeds Production; and

AQUACULTURE - Hatchery, Feed Mills Development/Fisheries Production cold chain fish processing and fish feed production.

PRIORITY AREAS FOR COMMERCIAL AGRICULTURE DEVELOPMENT PROGRAMME

Federal Ministry of Agriculture and Water Resources, Federal Republic of Nigeria 6


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AGRICULTURE SECTOR OUTPUT BENCHMARKSAGRICULTURE SECTOR OUTPUT BENCHMARKS

CommodityCommodity Current Production LevelsCurrent Production Levels Projected Production Levels Projected Production Levels (2011 Benchmarks)(2011 Benchmarks)

P% Yield % Yield IncreaseIncrease

CurrentCurrentImportsImports

‘‘000 Ha000 Ha Yield Yield (t/ha)(t/ha)

Output (‘000t)Output (‘000t) ‘‘000 Ha000 Ha Yield Yield (t/ha)(t/ha)

Output Output (‘000t)(‘000t)

US$mUS$m

Rice 2,131.98 1.97 4,200.01 3,214.20 2.8 9,000.00 114.3% 267.00

Sugar Cane 296.17 17.97 5,322.17 500.00 25.0 12,500.00 134.9% 640.00

Cassava 3,261.00 15.00 48,915.00 5,500.00 60.0 165,000.00 237.3% na

Maize 4,460.00 1.59 7,091.40 6,500.00 7.0 22,750.00 220.8% na

Cotton 293.67 1.02 299.54 700.00 2.5 1,750.00 484.3% na

Wheat 150.00 1.09 163.50 300.00 5.0 600.00 267.0% 102.00

Tomato 305.00 8.00 2,440.00 610.00 16.0 9,760.00 300.0% 50.00

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Source: NATIONAL FOOD RESERVE AGENCY, AGRIC PRODUCTION SURVEY, 2008


(3A)(3A)


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COMMERCIAL ARICULTURE DEVELOPMENT COMMERCIAL ARICULTURE DEVELOPMENT PROGRAMME: PROGRAMME:

SECTOR OUTPUT BENCHMARKS - 2SECTOR OUTPUT BENCHMARKS - 2

CommodityCommodity Current Production StatisticsCurrent Production Statistics(‘000t)(‘000t)

Projected 2011 Production Projected 2011 Production Statistics (‘000t)Statistics (‘000t)

P% Yield % Yield IncreaseIncrease

CurrentCurrentImportsImports

ProjectdProjectdSavingsSavings

Current Current Production Production

Current Current DemandDemand

Production Production ShortfallShortfall

Projected Production Projected Production US$mUS$m US$mUS$m

Livestock*(Heads)

690 1,315 625 760 10% 1,417.5 150.0

Dairy Products*

180 649 469 360 100% 400 400

Fisheries** 635 2,660 2,025 3,000 370% 987.0 2,306.5

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Source: FMA&WR, KAYS ‘07: Crop Yield Analysis

Current Production LevelsCurrent Production Levels Projected Production Levels Projected Production Levels (2011 Benchmarks)(2011 Benchmarks)

Currently Currently CultivatedCultivated

PotentialPotentialAvailableAvailable

‘‘000 Ha000 Ha % Increase% Increase

Irrigated Agriculture

20,000ha 3,400,000ha 120,000ha 600%

Source: *FAOSTATS, 2004, **FMAWR, 2008

Key: Livestock refers to meat and protein products only


(3A)(3A)


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Private sector partnership arrangements at advanced stage of conclusion with the following:

i.Dangote Group - 2,000ha pineapple in C/River- 20,000ha sugarcane in

Bauchi- 10,000 heads dairy cows

(Taraba (Mambilla) and Cross

River States)ii. Zimbabwe Farmers in Kwara and Nasarawa (crops and dairy development)iii.Equinox Group - Vegetables/fresh products

(Gombe and Kebbi States)iii.Olam, VT Rice - Out-grower activities (Kwara,

Niger and Anambra States)iii.TGI Group - Dairy, meat and fisheries

(Oyo (Ibadan), Rivers and Lagos)

- Market development (Farmer markets

and food centres nationwide)iii.Vietnamese Group - Rice and fisheries in Bayelsaiv.Josepdam Group - 220,000 ha sugarcane (Kwara –

Bachita)

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COMMERCIAL ARICULTURE DEVELOPMENT COMMERCIAL ARICULTURE DEVELOPMENT PROGRAMME:PROGRAMME:

IMPLEMENTATION MANAGEMENT ARRANGEMENTS: IMPLEMENTATION MANAGEMENT ARRANGEMENTS: PARTNERSHIPSPARTNERSHIPS


(3A)(3A)


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FINANCING ARRANGEMENTSFINANCING ARRANGEMENTS


FUNDING FLOWS TO SUPPORT THE PROGRAMME

N244.2 Billion Grant for value chain infrastructure (@ 40% FGN, 60% States) as a Special Intervention Fund (SIF)

N200 Billion Bond floated by the Debt Management Office (DMO) and subsidised by the CBN for single digit lending to agriculture.

Agricultural Enterprises Development @ 30% FGN Grant, 30% Service Providers’ own investment and 40% subsidised credit to the service providers through the Commercial Agriculture Credit Scheme (CACS) at 9% interest rate (maximum).

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The first of the above two funding flows, the SIF, totalling N244.2 billion over three years, shall be used as the value chain infrastructure support grant, with the resulting infrastructure strongly attracting new investments and creating income opportunities for millions of small-holder out-grower farmers throughout the country. The Programme will be funded by the Federal and State Governments on 40:60 cost sharing arrangement. The second funding flow, valued at N200 billion, being proceeds of a Bond floated by the Debt Management Office (DMO) shall provide low interest credit (9% with maximum tenor of 7 years, including 2 years moratorium). Investors shall sign in with 30% and the Federal Government shall match that with a grant of 30% for all the PPP investments, while the remaining 40% shall be provided from the low interest credit, giving an overall funding ratio of 30:30:40.

In addition, the World Bank has provided an IDA Credit Facility of US$150 million under the Commercial Agriculture Development Project and another US$250 million under Fadama III Project, to finance specific activities (mainly rural infrastructure development) in the States.

FINANCING ARRANGEMENTSFINANCING ARRANGEMENTS


(3A)(3A)


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Approach: Large scale commercial farming – best farming model for enhanced efficiency and cost-effectiveness through value chain approach

Aim: Use of Special Intervention Fund to achieve agriculturaldevelopment along the entire value chain over 3 years. Large scale commercial farming to be mainly throughout-sourcing production to out-grower farmers

Objectives: Enhanced market competitiveness in wheat, rice, sugar, milk, fish

Sustained national food security and employment generation

Promotion of modern agricultural practices in production,

storage/preservation, processing and marketing

Enhanced natural resource conservation and increased utilization

of irrigated agriculture to mitigate the effects of climate change

Enhanced income for the small-holder farmer

COMMERCIAL ARICULTURE DEVELOPMENT COMMERCIAL ARICULTURE DEVELOPMENT PROGRAMMEPROGRAMME


(4(4))


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COMMERCIAL ARICULTURE DEVELOPMENT COMMERCIAL ARICULTURE DEVELOPMENT PROGRAMMEPROGRAMME

KEY PROGRAMMES OF THE 5 POINT AGRICULTURE AGENDA

1. Developing Agricultural Policy and Regulatory Systems (DAPRS)

2. Food Systems Network (FOODSNet)

3. Rural Sector Enhancement Programme (RUSEP)

4. Developing Agriculture Inputs Markets in Nigeria (DAIMINA)

5. Maximising Agricultural Revenue in Key Enterprises (MARKETS)

FIVE POINT AGRICULTURE AGENDA



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FIVE POINT AGRICULTURE AGENDA - 1FIVE POINT AGRICULTURE AGENDA - 1

Proactive policy agriculture development in Nigeria via a Value Chain approach, with the goals of:

1. Achieving sustained national food security

2. Enhancing market competitiveness of Nigerian commodities

3. Promoting global best practices in agricultural production/agribusiness

4. Mitigation of climate change

Monitoring and Evaluation of Programmes

Regulatory framework to support backward integration and market competitiveness by leveraging on appropriate tariff regimes, fiscal incentives and a legal framework for institutional support (NAFRA, Quarantine etc.)

Research and Development

a. Improved Seed, Brood Stock and Fingerlings

b. Enterprise Development in Agric

(i) Agric Sample Census – Comprehensive National Agricultural Database

(ii) Cooperative Reform Programme - Agric. Enterprise Development to generate 1 million jobs within 3 years

DEVELOPING AGRICULTURAL POLICY & REGULATORY SYSTEMS



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Agric. Cadastre (Digitized online soil map of Nigeria)

National Pest Control Programme (Complete circle)

Dams & Irrigation Schemes (2 billion cu. metres of water to be impounded and 150,000 ha additional irrigation land)

Construction/Completion of Silos (20 silos – 1 million tonnes) along with Agro- Processing Facilities (PPP)

Upgrading and Equipping of Agricultural Research System: Collaborative

research on yield enhancement

Food and Animal Feed Production (PPP) through utilisation of leased silos

Grazing Reserves Development (3 model Grazing Reserves)

(Breed development and milk delivery)

Aquaculture Development (Fisheries) Development of 16 Integrated Fisheries Estates) – 2m tonnes fish production target in 3 years

FOOD SYSTEMS NETWORK



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Rural Feeder Roads (World Bank Intervention)

Fadama III (IFAD Programme – Roads and Markets)

Agri-Nigeria Project ( 1m Job creation Initiative )

Agric Information Management System for Farmers

RURAL SECTOR ENHANCEMENT PROGRAMME



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“One-Stop Shop” Agro-input Service Centres - 300 no. (PPP)

Agro-seeds Service Centres (40 centres on PPP)-Seed Production and Multiplication using out-grower scheme

Fertilizer Procurement (400,000 tonnes)

Mechanization (Tractor Service Scheme – 3,525 sets)

DEVELOPING AGRICULTURE INPUTS MARKETS IN NIGERIA




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Rice Processing (25 large scale rice processing mills – at least 1million tonnes milled rice/year)

National Abattoir Management and Dev. Programme (6-12 abattoirs in States and FCT)

Cassava Processing (3 large scale mills, 200 mini mills to do 500,000 tonnes cassava per annum)

Guaranteed Minimum Price (GMP – 310,500 tonnes of assorted commodities)

Market Infrastructural Development (1,200 model markets on highways and 6 minimarts in each of selected towns of 12 States) (Crops (12 markets), Livestock (9 markets) & Fisheries (15 markets) )

MAXIMISING AGRICULTURAL REVENUE IN KEY ENTERPRISES




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Input services provision – Fertilizers procured and distributed efficiently & cost-effectively

Agro-export handling centres – 6 no.

Markets – Farmers’ markets and food centres

Guaranteed Minimum Price (GMP) – N10 billion set aside for stabilising food prices for over 90 million population of potential food insecure people

Agro-processing for production of edible flours and animal feed

Gurara Agro Park Development Project

Agro seed centres (40 no) on PPP basis

Modern abattoir development in: Kano, FCT, Katsina, Gombe, Port Harcourt, Oyo, Enugu and Benin

Orthographic photo mapping of the Gurara area and 50 no. Grazing Reserves nationwide

National Soil Survey Programme – Digitised soil map of Nigeria

Green Nigeria Project - Enterprise development in agriculture

SUMMARY OF ACHIEVEMENTS IN THE LAST 2 YEARS


CONCLUSIONCONCLUSION(5(5))


___________________________________________________________________________Grain silos – Agro-processing Centres for Edible Flours and Animal Feed

Agro-export handling centres – 6 no.

Markets – for continued construction of Farmers’ markets and food centres

Guaranteed Minimum Price (GMP) – N10b in 2009 and N30bn by 2010

Agricultural inputs centres (one-stop shops in each LG Area for agric inputs supply)

Integrated Fisheries Estates

Rice processing centres

Gurara Agro Park Development Project (US$5m)

Agro seed centres (40 no) on PPP basis

Abattoir Enhancement Programme

Cold chain storage infrastructure development for livestock, fresh vegetables, fruits and fisheries products and allied agro-aviation infrastructure for their evacuation

Tractor hiring and ownership scheme

Other Private sector-driven projects: jatropha carcus (bio-diesel), bio-ethanol, fruits and vegetable production for export etc.

SUMMARY OF ONGOING PPP PROJECTS IN AGRICULTURE


CONCLUSION - 2CONCLUSION - 2


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Conference on Tariffs and Fiscal Incentives

Conference on Anti-smuggling to kick off a regional campaign

Public Presentation of the Green Nigeria Project:

a 1 million jobs creation initiative over the next 3 years

COMMUNICATION STRATEGY: Immediate Follow-up Actions


CONCLUSION - 3CONCLUSION - 3


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THANK YOUTHANK YOU


Federal Ministry of Agriculture and Water Resources, Federal Republic of Nigeria

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Transcript of Federal Ministry of Agriculture and Water Resources, Federal Republic of Nigeria