Ministerial Platform for the 2012 National Democracy Day Celebration and First Anniversay

MINISTERIAL PLATFORM FOR THE 2012 NATIONAL DEMOCRACY DAY CELEBRATION AND FIRST ANNIVERSAY OF PRESIDENT GOODLUCK JONATHAN’S ADMINISTRATION: INPUT FROM THE FEDERAL MINISTRY OF AGRICULTURE AND RURAL DEVELOPMENT

INTRODUCTION

Agriculture is an important sector of Nigerian economy with high potentials for employment generation, food security, poverty reduction and industrialization of the country.The Agricultural Transformation Agenda [ATA] of the Federal Ministry of Agriculture and Rural Development is directly building on Mr. President’s Economic Transformation Agenda.

2.The vision in the transformation strategy is to achieve a hunger-free Nigeria through an agricultural sector that will drive income growth, accelerate achievement of food and nutritional security, generate employment and transform Nigeria into a leading player in global food markets to grow wealth for millions of farmers. The Agricultural Transformation Agenda is designed to make the Agricultural sector a business project as against development project to promote private investment in agriculture, to execute integrated projects via value chain processes, generate employment, and transform Nigeria into a net exporter of agricultural commodities.

3.As part of the Federal Government of Nigeria’s effort to revamp the agriculture sector, ensure food security, diversify the economy and enhance foreign exchange earnings, the FMARD embarked on a Transformation Agenda with a focus on the development of agricultural value chains. The transformation action plan is focused on key aspects of value chains, including the provision and availability of improved inputs (seed and fertilizer), increased productivity and production, as well as the establishment of staple crop processing zones. It also addresses reduction in post-harvest losses, improving linkages with industry with respect to backward integration, as well as access to financial services and markets. The Transformation Agenda targets rural communities particularly women, youth and farmers associations, as well as improving rural institutions and infrastructure.

The transformation agenda sets out to create over 3.5 million jobs from the rice, cassava, sorghum, cocoa and cotton value chains, with many more jobs to come from other value chains under implementation. The programme aims to provide over 300 Billion Naira (US$ 2 billion) of additional income in the hands of Nigerian farmers. Over 60 Billion Naira (US$ 380 million) is to be injected into the economy from the substitution of 20% of bread wheat flour with cassava flour. We would have enabled Nigeria to be food secure by increasing production of key food staples by 20 million tons: Rice: 2 million metric tons: Cassava: 17 million metric tons and Sorghum: 1 million metric tons

The action plan focuses on some priority agricultural commodities namely; rice, cassava, sorghum, cocoa cotton, maize, oil palm,dairy, beef, leather, poultryand fisheries. The operations of the Agricultural Transformation Agenda are based on the following principles and modalities:-

Prioritization of Commodity Value Chains [CVCs] along comparative advantagein the six geo political zones of the country as follows:-

North-East:cotton, onion, tomato, sorghum, rice, cassava, livestock and fisheries

North-West:cotton, onion, tomato, sorghum, rice, cassava, livestock and fisheries

North-Central:maize, soya bean, rice, cassava, livestock, and fisheries

South-East: oil palm. Cotton, rice cassava, livestock and fisheries

South-West:oil palm, cocoa, rice, cassava, livestock and fisheries

South-South:oil palm, cotton, rice, cassava, livestock and fisheries

Reform in the input supply sector to stop direct government involvement in the procurement, supply and distribution of fertilizer and seeds to farmers. This involves provision of 50% support for seeds and fertilizers for farmers. Empowerment of the Private sector to sell their inputs directly to farmers and build their supply chains to get to rural areas. Provision of risk sharing guarantee to leverage loans from banks for seed and fertilizer companies and agro-dealers

We are establishingprivated sector led Commodity Trade and Market Development Corporations for the various commodity value chains which will coordinate the entire value chains in Nigeria, and enhance Nigeria’s competitiveness, while expanding and stabilizing income for our farmers. We have just finalized the terms of reference for the study and will be advertising for consultants to undertake feasibility studies in the next two weeks.

We are working with the Central Bank of Nigeria on the introduction of the Nigeria Incentive-Based Risk Sharing System for Agricultural Lending [NIRSAL] to de-risk agricultural financing and mitigate against the impact of natural disasters on losses of agricultural investments by facilitating low-interest credit to farmers through commercial banks and the liberalization of the insurance sector to increase farmers access to cost effective agricultural insurance schemes in the country. We have just negotiated the first deal to tune of N1.7 Billion to provide single digit interest financing for Cassava dried cheap exporters to mop up excess cassava from the farmers.

Establishment of 18 Staple Crop Processing Zones [SCPZ] all over the country as a cluster-based value chain strategy to attract private investors set up food processing plants in areas of high food production, link farmers in clusters to food manufacturing plants, create jobs and drive rapid rural economic growth. Operators in these Staple Crop Processing Zones will receive Fiscal, Investment and Infrastructure incentives:

Establishment of a National Farmers Data Base through the registration of farmers and the harmonization of existing information/data on Agric census and farmers cooperatives for the effective implementation of the Agricultural Transformation Agenda.

Use of Guarantee Minimum Price [GMP] to stabilize prices and to absorb excess output of agricultural produce and encourage increased production of commodities in a manner that would benefit the stakeholders involved in the ATA value chain process.

Promotion of agricultural mechanization through the use of farm machinery, implements, and processing machines for the production of crops, livestock and fish as well as their finished products. We are identifying existing and new private sector operators that will provide mechanization support through leasing hiring and rentals to the farmers.

Revitalization and modernization of agricultural extension services to empower farmers on the adoption and application of research results, technologies, and techniques for agricultural production.

ACHIEVEMENTS TO DATE

4.The implementation of ATA and the achievements of the Value Chain Mechanism are as follows: -

Cassava Value Chain

Objectives / Strategies

create sustainable demand in the industrial food, beverage, and chemical sector for cassava and cassava-based products and build effective cassava value-chains for High Quality Cassava Flour (HQCF), Starch, Sweeteners, Fuel Ethanol, Dried Chips for export and animal feed, and traditional food product.

encourage the use of modern technology in manufacturing activities and reposition Nigeria among the world’s leading producers and processors of cassava.

use of cassava starch in reasonable proportion as replacement of corn starch in making domestic and industrial starch;

use of high fructose cassava syrup as substitute for sugar consumed by beverages and drink industries;

use of cassava ethanol to support the 10% ethanol content policy in gasoline-ethanol blending for automotive industry.

Achievements

utilization of high quality cassava flour [HQCF] as 20%substitution of wheat flour for making bread and confectionaries through public private partnership arrangement with multinationals and R&D institutions. IITA, Butterfield and UTC are leading in the efforts to commercialize the cassava bread. As we speak, UTC cassava bread is on some major streets in Nigeria.

We are facilitating the establishment of 18 High Quality Cassava Plantswith capacity to process 240 tons tons/day to meet 1,440,000 tons per year. The Plants locations are as detailed below.

S/N / STATE / APPROXIMATE LOCATION
1 / Abia / Abriba
2 / Akwa-Iobm / Uyo
3 / Anambra / Ahiala
4 / Benue / Makurdi
5 / Cross-river / Obubura
6 / Delta / Mbiri
7 / Edo / Iraoko
8 / Ekiti / Itapaji
9 / Enugu / Ebenebe
10 / Kogi / Agbadu
11 / Kwara / Sare
12 / Lagos / Epe
13 / Nassarawa / Gbude
14 / Ogun / Ijebu-Igbo
15 / Ondo / Ore
16 / Osun / Iwo
17 / Oyo / Oke-Ogun
18 / Oyo / Iseyin

We are upgrading a total of 105 SMEs producing High Quality Cassava Flour in 23 States of the Federation from a total of 31,500mt per annum to 63,000mt per annum.

We are promoting increased marketing opportunities of starch, sweeteners, and flour plants. Coca-Cola is investing in high fructose cassava syrup plants of 30,000mt per annum. Nestle is substituting imported starch with cassava starch to the tune of 5,000mt. The total sugar requirement for soft drink bottlers and juice manufacturers in Nigeria is estimated at 200,000 tons of sugar p/a. A replacement of half of this by HFCS from cassava, would create a 100,000 ton demand for cassava tubers.

We have helped the cassava chips exporters to find market for their products. Currently cassava exporters have secured LPOs to the tune of 1 Million mt from China. Government has assisted them to secure financing for this business under NIRSAL guarantee to the tune of N1.7Billion. These groups have also been trained.

We are also promoting the use of cassava grits as poultry feeds. We are working with cassava grit producers to meet the supply of 480,000mt at 25,000 per mt as required by the Poultry Associations of Nigeria.

Government is working with other collaborators to provide a one-stop shop for exporters to reduce bottlenecks associated with the process.

working with State coordinators in the 23 States on possibility of promoting clusters for production of gari, lafun, fufu and abacha as well as agronomy trials in 23 states with priority in out-growers scheme;

Rice Value Chain

Objectives / Strategies

Raise average paddy yield between 5.0 MT/ha and 6.0 MT/ ha in low land and irrigated ecology areas; improve rice quality, target affordable price to make it competitive; and make Nigeria self-sufficient in rice production. We are targeting production of825million MT by 2012.

Use improved rice varieties FAROs 44, 52, 57, L29, and L34 adaptable and acceptable to farm, millers and consumers

organizing farmers into clusters around medium and large scale mills so that they can readily access growth enhancement support inputs such as improved seeds, fertilizer, agrochemicals and modern methods of rice production from extension services.

Achievements

Government is utilizing the N10b industrial credit facility by Bank of Industry [BOI] Ltd to finance the establishment of 17 rice mills of which one plant had been commissioned in Ebonyi State. Two rice mill projects are on-going, while investment into the remaining 14 rice mill projects with additional 480,000 milling capacity would be promoted through the public private partnership arrangement.Nigeria’s rice has good quality and taste to compete with imported rice. Import substitution to save $2.5 Billion per year.

Securing the commitment of Messrs Dominon, the largest rice producer in Kenya, to invest $40 million in rice production in Taraba State with a view to facilitating large cultivation of rice involving several small scale farmers to supply raw materials to processing plants. This would require 30,000 hectares of land and training of 1,250 farmers in commercial farming. Only 3,000 hectares will be managed and owned by the investor while the balance of 27,000 hectares will be farmed by Nigerian farmers.

Government had facilitated the acquisition of machineries and equipment from China for setting up 100 rice mills to process 2.1m MT of parboiled rice. Forty (40) of these will be ready in the next 10 months. The Statewide distribution is as follws:

STATE / PROPOSED ALLOCATION / SUGGESTED LOCATION
1 / ABIA / 2 / Bende
2 / ADAMAWA / 3 / Fufore, Yola
3 / AKWA IBOM / 2
4 / ANAMBRA / 2 / Omor, Amichi
5 / BAUCHI / 4
6 / BAYELSA / 2 / Yenagoa, Elebele
7 / BENUE / 4 / Gboko, Makurdi, Otukpo, Obagaji
8 / BORNO / 3 / Ngala
9 / CROSS RIVER / 3 / Bansara
10 / DELTA / 2 / Ughelli
11 / EBONYI / 3
12 / EDO / 2 / Auchi
13 / EKITI / 1 / Igbimo
14 / ENUGU / 2 / Adani
15 / FCT / 2 / Abaji
16 / GOMBE / 2
17 / IMO / 2
18 / JIGAWA / 3 / Hadejia
19 / KADUNA / 4 / Saminaka
20 / KANO / 4 / Sharada, Kura
21 / KATSINA / 3
22 / KEBBI / 3 / Zauro Polder
23 / KOGI / 3 / Idah
24 / KWARA / 5 / Lafiagi, Pategi
25 / LAGOS / 2
26 / NASARAWA / 3 / Keana
27 / NIGER / 7 / Wushishi, Wuya, Badeggi
28 / OGUN / 3 / Imope, Itori
29 / ONDO / 1 / Igbokoda
30 / OSUN / 2
31 / OYO / 2 / Oyo
32 / PLATEAU / 3
33 / RIVERS / 2
34 / SOKOTO / 3 / Kware
35 / TARABA / 2 / Wukari
36 / YOBE / 3
37 / ZAMFARA / 3

Government is supporting research and development activities on rice varieties through collaboration with the Yuan Longping Centre in China for setting up a Hybrid Development Centre in the Nigeria Cereals Research Institute, Badeggi, Niger State, to produce high yield varieties of rice.

The Federal Government, Anambra State Government and a private investor had facilitated the resuscitation of Omoh Rice Mill located in the Sate, through the provision of water and electricity and other incentives to reactivate the mill.

Cocoa Value Chain

Objectives / Strategies

Doubling output from 250,000 MT to 500,000 MT by 2015 through the use of the eight new cocoa varieties.

Improving the livelihood of 250,000 farm house holdsthrough enhanced yield per hectare and to achieve additional income of at least US$ 450 annually.

Creating 390,000 jobs through increased production, processing, and marketing activities.

Establishing Cocoa Producing and Exporting Countries Council involving world producers to regulate the volume of cocoa output and prices;

collaboration of Government and private firms at the Federal and State levels to develop and operate State Seed Gardens for the sourcing and rapid multiplication of cocoa seeds to meet the targets of the Agricultural Transformation Agenda;

Rehabilitation of 200,000 hectares using high yielding materials, and the stimulation and expansion of the target output to double production using cloned materials.

strengthening of local capacity for grading cocoa beans, build farmers capacity to produce, and put in place demonstration farms throughout designated States;

establishment of cocoa agribusiness center scheme that would encourage young graduates to go into cocoa farming on a 10 ha of land to be provided by the State Governments; and

Encouragement of private manufacturing firms to engage in backward integration and support production.

Achievements

The cocoa value chain is working assiduously toward the implementation of the cocoa action plan in 22 States in 2012 as follows:

The release of 8 new high yielding cocoa hybrids by CRIN will transform cocoa production across the 14 Cocoa producing States. The new varieties are capable of yielding 2,000kg/ha as compared to 350kg/ha for old varieties. The new varieties mature in 2.5 years compared to 4 years for the old varieties.
Rehabilitation of some 86,110 hectares nation-wide in partnership with State Governments and private sector in 2012.
Provision of free 2.6 million seed pods of improved planting materials for the 86,110 hectares to be rehabilitated and 56,920 hectares to be opened up.
We have developed a technical plan to make an inventory of cocoa farmers and cocoa resources in State and Local Government Areas.
We have developed Terms of References for the incorporation of Cocoa Marketing and Trade Development Corporation as well as the establishment of Cocoa Producing and Exporting Countries (COPEC). We are finalizing arrangement for the hosting of the meetings of Agricultural Ministers to discuss this further in June, 2012.

Cotton Value Chain

Objectives/Strategies

improve cotton production through productivity enhancement by supporting research and institutional capacity, and promote industrial value chains of cotton and bye-products.

facilitate and ensure efficient /effective marketing through functional Private Public Partnership (PPP) .

drive production using Integrated Contract Cotton Farming approach using functional ginneries as production hubs.

expand cultivable areas in the North West and North East and South West ecological zones of the country and extend such to other ecological zones that have potentials for cotton production.

encourage seed buy back arrangement for breederstock, foundation stock, and certified stock towards increasing local seed production.

facilitate a phased acquisition of domestic capacity for ginneries as a hub of mass production of cotton lint.

Aggressive multiplication of pure cotton seed using public private partnership

Promoting clean cotton by withdrawal of polypropylene bags and substituting with cotton cloth harvest bags through the ginneries. Requirement- 2.62 million cotton bags(Locally sourced).

Providing cotton farmers with GES (Seed and Fertilizers)

Achievements

Seed development/supply

Government is providing 1,750 mt of certified seeds through an MOU with a private company - WACOT

Government is about signing the Bio-safety law to enable us join the league of BT cotton producing countries.

Engagement of states

We have mobilized cotton producers from 11 States covering NW, NE & SW Zones. These include Niger, Kaduna, Zamfara, Katsina, Kano, Jigawa, Borno, Adamawa, Gombe, Oyo & Ogun.

Clean cotton project

Government has launched the process of producing Cotton Cloth Harvest Bags to replace polypropylene leather bags.

Ginneries repositioning

We have been engagingthe Ginners Association on PPP for cotton production and processing.

Sorghum Value Chain

Objectives / Strategies

increase the output of sorghum through the combination of local and exotic varieties to develop and use high yielding hybrid varieties. The goal is to make Nigeria the largest processor of food sorghum in the world. We are working in 6 states of Borno, Adamawa, Bauchi, Kano, Kauna and Zamfara.

Diversify the sorghum sector into three value chains, namely, fortified foods (high energy blend foods like soy-akamu for school feeding; malt, malt beverages and malt drinks (non-alcoholic) like ‘DawaMalt’; and High Quality Sorghum Flour (HQSF) for instant ‘Tuwo Meal’ , extruded foods like noodles and macaroni, baking bread with wheat (upto 20%) and baking wheatless bread (sorghum bread).

Fast track the release of two newly developed sorghum hybrids. Use of mobile threshers, stimulating upto 500,000 metric tons of industrial use of sorghum in malt, malt beverages and drinks. Stimulate upto 1,500,000 metric tons of industrial use in fortified foods (soybean flour blends with sorghum flour for high energy foods), instant TuwoMeal, Extruded Foods and Steamed Foods like couscous and burabusko (sorghum grits).