How agricultural reforms are strengthening food security

Nigeria’s agriculture, vital to the economy and national food security, is undergoing a transformative overhaul under President Bola Ahmed Tinubu’s reforms. From smallholder financing and market restructuring to farm input supply, mechanisation, livestock and soybean development, the sector is registering early production gains, even as policy gaps and implementation delays persist, reports DANIEL ESSIET.

The agricultural sector contributed roughly 23 per cent to Nigeria’s Gross Domestic Product (GDP) in the first quarter of 2025, according to the National Bureau of Statistics (NBS), and employed close to two-thirds of the national workforce, making it one of the most significant pillars of the economy. Yet the structure of this contribution exposes deep vulnerabilities — and a paradox — at the heart of the nation’s food security challenge.

More than 80 per cent of farmers are smallholders who account for nearly 90 per cent of total output, even though over 70 per cent of them live below the poverty line. Addressing these structural distortions became a central objective of the reform programme introduced by the administration of President Bola Ahmed Tinubu, particularly as they affect smallholder productivity and income. Key interventions include the expansion of credit access, improved input delivery systems and logistics modernisation across several states, all aimed at strengthening both smallholder and commercial farming operations. Early outcomes have been reflected in improved rice and maize production, although cheaper imports continue to exert pressure on local producers, especially in wheat and dairy.

At the core of the government’s effort to unlock long-term financing for a sector dominated by smallholders is the recapitalisation of the Bank of Agriculture (BOA). The initiative is designed to reposition the institution as a modern development finance bank with renewed emphasis on value-chain financing, mechanisation, digital innovation and capacity building — particularly for smallholder farmers, youth and women-led agribusinesses.

The N1.5 trillion recapitalisation approved in 2025 is expected to widen access to low-interest loans aligned with agricultural production cycles, enabling farmers to invest in seeds, fertilisers, irrigation and machinery. Policymakers believe improved financing could integrate up to 90 per cent of agricultural output into structured value chains, reduce post-harvest losses and stimulate rural employment at a time of high inflation and rising food insecurity.

Complementing this effort are de-risking mechanisms involving guarantees from African Export-Import Bank and the National Smallholder Farmers Fund, which aims to mobilise up to $1 billion to reduce exposure to foreign-exchange volatility and ease collateral constraints that have historically excluded rural farmers from formal credit. Meanwhile, broader financial-sector reforms have encouraged increased lending to agriculture, with a proposed allocation target of up to 25 per cent and the introduction of moratorium structures that better reflect crop and livestock gestation periods.

Industry operators and experts say the administration’s agricultural reform agenda reflects a multifaceted policy approach combining financial restructuring, sector-specific master plans and targeted development programmes to stabilise food prices, boost productivity and reposition crop and livestock value chains for long-term growth. Surveys by the National Agricultural Extension and Research Liaison Services (NAERLS) indicate increases in rice, maize and cassava output in 2025, suggesting early gains from some of the reforms and interventions.

According to the Minister of Agriculture and Food Security, Abubakar Kyari, the reforms align with the Federal Government’s Renewed Hope Agenda and the National Agricultural Technology and Innovation Policy (NATIP). He added that they complement more than N200 billion in parallel interventions, including fertiliser support and other productivity-enhancing inputs. According to him, the objective is not only to expand access to finance but also to de-risk agricultural lending and prioritise investments that translate directly into productivity gains. Against this backdrop, he said implementation has progressed this year through branch-level lending structures, with a strong emphasis on annual targets for youth- and women-owned enterprises, cash-flow-based financing in place of asset-heavy collateral requirements, and complementary investments in storage, logistics and aggregation infrastructure to strengthen market access.

Within this framework, the Bank of Agriculture (BoA), which is central to the rollout, now requires prospective individual borrowers, cooperatives and small and medium-scale enterprises to operate accounts with a minimum three-month transaction history. The bank estimates that between 40 million and 70 million farmers could ultimately be reached, with productivity benchmarks targeting improvements from an average of one tonne per hectare to as much as nine tonnes per hectare across priority value chains, driven by technology adoption and improved agronomic practices.

At the same time, policy priorities under the financing framework include strengthening seed systems, expanding rural finance, promoting climate-smart agriculture and supporting agro-allied industries to reduce food inflation and curb post-harvest losses. However, implementation has faced delays linked to regulatory approvals, bureaucratic bottlenecks and concerns about capital quality — challenges that mirror those observed during past commercial bank recapitalisation exercises. Analysts warn that prolonged delays could slow farmers’ access to credit at a time of persistently high inflation and rising production costs.

Tackling food insecurity with zero-duty policy

As part of efforts to address food shortages and rising prices — and ultimately reposition agriculture as a pillar of national food security — the administration approved a zero-duty import policy covering six basic food items. The policy imposed zero per cent import duty and exempted Value Added Tax (VAT) on essential staples — husked brown rice, grain sorghum, millet, maize, wheat and beans — for the period July 15 to December 31, 2024. Designed to bridge supply gaps amid economic hardship, the initiative placed quota administration under the supervision of the Nigeria Customs Service (NCS), based on approvals from the Ministry of Finance. Notably, the waivers excluded seeds of these commodities.

Eligibility conditions were stringent. Participating importers had to be Nigerian-incorporated companies with at least five years of operations, alongside verified tax filings, payroll records and statutory compliance over that period. In addition, at least 75 per cent of imported volumes were required to be sold through recognised commodity exchanges, with comprehensive transaction and storage documentation available for government audit. Non-compliance attracted penalties, including withdrawal of waivers and repayment of duties, VAT and levies, while exports of the covered items were prohibited.

The measure was conceived as a balance between short-term consumer relief and long-term domestic production goals, complemented by input support programmes for smallholder farmers. Its impact has been significant. Prices of key staples — particularly rice — declined noticeably, driven by a combination of targeted imports and production improvements. The price of rice, for instance, reportedly fell from about N100,000 to around N60,000 per bag, while peppers and poultry feed also recorded reductions by early 2026, reflecting improved supply conditions.

At a time when food inflation has strained household budgets, pushed millions closer to poverty and heightened social tensions, the Federal Government’s interventions delivered an immediate and tangible outcome: lower food prices. For urban consumers and low-income households, the easing of food costs provided welcome relief after years of relentless increases. However, broader inflationary pressures and structural production challenges persist, raising questions about the sustainability of the gains.

Within the agricultural economy, concerns have emerged over whether policy choices are inadvertently trading the long-term viability of domestic production for short-term consumer comfort. At the centre of the debate lies a familiar but unresolved tension — balancing food affordability with farmer welfare — with experts warning that recent interventions could weaken the very production base on which future food security depends.

According to the Chief Executive Officer of the Centre for the Promotion of Private Enterprise (CPPE), Dr Muda Yusuf, the government’s approach reflects a delicate but potentially risky imbalance. “The welfare gains from cheaper food have been profound and should be acknowledged. However, the cost to farmers and other investors across the agricultural value chain is equally significant and cannot be ignored,” he said.

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His assessment captures the paradox confronting the sector. Measures aimed at suppressing food prices — particularly import liberalisation and emergency market interventions — have increased the supply of cheaper staples. For domestic farmers, however, the consequences have been severe. Import surges of rice, maize and soybeans, combined with harvest-time gluts and weak market infrastructure, have pushed farmgate prices below sustainable levels. As incomes decline, incentives to invest in production, adopt improved technologies or expand cultivated land also weaken. “Nigeria cannot afford a policy regime that undermines confidence and discourages investment in agriculture — one of the most strategic sectors of the economy, a major source of livelihoods and one of the country’s largest employers of labour,” Yusuf warned.

Beyond imports, structural weaknesses within the agricultural system continue to amplify price volatility. Poor rural roads and inefficient logistics inflate transport costs, eroding farmer margins and reducing competitiveness, while inadequate processing capacity means surplus output often goes to waste instead of being converted into higher-value products. These constraints ensure that even when production increases, farmers rarely capture the benefits. Addressing such systemic failures requires more than episodic interventions; it demands institutional reform. In this context, Yusuf’s call for a National Farm Price Stabilisation and Farmer Income Protection Framework has gained traction among policy analysts seeking more durable solutions.

National Livestock Master Plan and deployment of 2,000 tractors

One of the administration’s sector-specific strategies for transforming agriculture focuses on the livestock sub-sector. The National Livestock Master Plan, supported by the Federal Ministry of Livestock Development, has begun to reshape the industry, with projections indicating growth from an estimated $32 billion to about $91 billion by 2035.

The expansion is anchored on 10 strategic pillars covering value-chain development, animal health systems, feed and pasture improvement, breed enhancement and expanded market access. Institutional coordination has also strengthened following the inauguration of the National Council on Livestock Development, which is responsible for policy execution and nationwide implementation of the master plan. Complementing this framework, the National Livestock Development Policy prioritises improved feed systems, veterinary services and technology adoption to enhance productivity and food security.

Broader agricultural land-use and genetic-improvement policies introduced by the current administration have also encouraged the establishment of grazing reserves and livestock breeding programmes. Despite these interventions, however, the sub-sector continues to face structural constraints, including feed shortages, disease burdens and low vaccination coverage. More broadly, insecurity, climate variability, high input costs, inadequate rural infrastructure, low mechanisation levels and significant post-harvest losses continue to limit productivity across both crop and livestock systems. Data collection challenges — driven by farmer illiteracy, limited funding and fragmented information systems — have further complicated planning and policy evaluation.

In June 2025, President Tinubu unveiled 2,000 tractors supplied by Belarus under the Renewed Hope Agricultural Mechanisation Programme, describing the initiative as a potential turning point for food production and youth engagement. The Minister of Agriculture and Food Security, Kyari, characterised it as an unprecedented intervention in scale and ambition.

However, concerns emerged when many of the tractors reportedly remained parked at the National Agricultural Seeds Council facility near Gwagwalada, Abuja, unused despite strong demand from farmers. The slow deployment raised questions about whether a clear distribution framework had been established before the equipment arrived. It was not until November last year that the Bank of Agriculture (BOA) issued a public call for applications to lease or acquire the machines.

The BOA subsequently outlined a pay-as-you-go financing model requiring a 25 per cent down payment, with repayment spread over three to five years at a 15 per cent interest rate. Its Managing Director, Ayo Sotinrin, maintained that the delay reflected a deliberate transition from politically driven equipment distribution toward a commercially sustainable service-provider model. “Yes, it has started already. Tractors have started going out and also other equipment,” he said, noting that more than 100,000 applications were screened down to 2,000 beneficiaries — mainly mechanisation companies expected to serve clusters of smallholder farmers.

According to the BOA leadership, each participating firm must demonstrate financial capacity, cultivate at least 500 hectares and operate under GPS-tracked monitoring systems to prevent diversion. Stakeholders familiar with the arrangement say the approach could mechanise more than 100,000 hectares per farming cycle, indirectly serve millions of farmers and generate revenue to scale the programme to tens of thousands of tractors in the future. Critics, however, argue that the eligibility requirements favour large aggregators and elite operators, effectively excluding most small-scale farmers who remain the backbone of Nigeria’s agricultural production.

Complementing these reforms are the Special Agro-Processing Zones, supported by the African Development Bank and development partners. The zones — being established in states such as Kaduna State and Oyo State — aim to integrate agricultural production with industrial processing, reduce post-harvest losses and expand export opportunities by linking farmers directly to structured markets and value chains.

Some grey areas of the reforms

While several of the current reforms are gradually transforming Nigeria’s agricultural sector, industry operators and stakeholders identify key areas that require further attention to ensure the reforms fully deliver on their promises. One critical focus is the future of soyabean production. Often called the “golden bean,” soyabean quietly shapes global food and agricultural markets. Rich in protein, oil, and essential nutrients, the legume is indispensable to animal feed, human nutrition, and industrial applications such as biodiesel. As the world shifts toward more sustainable and diversified food sources, demand for soyabean continues to rise.

Global production remains dominated by the U.S., Brazil, and Argentina. The U.S. leads with tens of millions of tonnes annually, supporting extensive domestic processing and exports. Brazil’s output has surged in recent years, occasionally surpassing that of the U.S., while Argentina remains a major contributor. By contrast, Africa accounts for a small fraction of global output, though the continent’s potential is immense, with vast uncultivated arable land that could strengthen food security and generate employment.

Despite this potential, Nigeria’s soyabean production remains modest. The Federal Government reports annual output at roughly 1.35 million metric tonnes, only about half of domestic demand. Minister of Agriculture and Food Security highlighted this gap at the recent launch of the National Soybean Production and Expansion Policy and Strategy in Abuja. The government’s drive to reduce soyabean imports is motivated by two key objectives: conserving scarce foreign exchange and stimulating domestic industrial growth. Historically, Nigeria has relied heavily on imports, particularly from the U.S. For example, in 2024 the country imported about 62,100 metric tonnes of U.S. soyabeans after a six-year hiatus, largely to supply the growing poultry sector.

Under the new policy reforms, Nigeria aims to expand soyabean cultivation from under one million hectares to approximately two million hectares by 2027. Targets include annual industry revenues of N3.9 trillion and the creation of one million farm and off-farm jobs across 22 states and the Federal Capital Territory. Kyari emphasised that “food security is not merely an aspiration; it is an urgent mission,” underlining the strategic importance of boosting domestic production while maintaining quality standards.

A central pillar of the government’s strategy is its focus on non-genetically modified (non-GMO) soyabeans, contrasting with the heavily modified varieties prevalent in the Americas. Officials note that this approach positions Nigeria favorably in premium markets in Europe and parts of Asia, where demand for non-GMO and sustainably produced crops is rising. However, structural challenges remain. African soyabean production, while growing, still represents only a small portion of global output, constrained by agro-ecological limitations and low-input farming systems. Local yields have improved through private-sector partnerships and international collaboration, but experts caution against complacency.

Dr. Ayodele Uwala, President of the Nigeria Soybean Association, expressed concern over the withdrawal of agronomy support by the U.S. Soybean Export Council (USSEC), which had been instrumental in boosting yields from below one tonne per hectare to between 2.0 and 2.5 tonnes per hectare through targeted training. He warned that without swift government intervention, “recent gains could be reversed,” urging the Federal Government to sustain these critical programmes.

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As Chairman of the Soybean Excellence Center, Uwala emphasised the urgent need for government action to bridge the gap left by international partners. “The Federal Government should step in quickly to provide the necessary support to take over these essential agronomy activities,” he said. “Our goal has always been to provide a forum for solving problems in production and processing, and right now, the most pressing issue is ensuring our farmers retain the knowledge and resources to maintain these high yields. We must protect our export status and meet the rising global demand for our product.”

With international demand at an all-time high and domestic production on the rise, Nigeria stands at a pivotal moment. Whether the country can maintain recent momentum, expand cultivation, and fully harness its export potential depends on sustained policy implementation, scientific innovation, and robust institutional support. Industry stakeholders believe local farmers have the capacity to meet both domestic and international soyabean demand — provided the Federal Government delivers the necessary support. This challenge now defines the future of Nigeria’s soyabean sector.

Stalled Cocoa Management Committee

Cocoa farmers and industry groups are also pressing President Tinubu for urgent clarification on the fate of the Cocoa Board Bill, which has remained in limbo since it was withdrawn from the National Assembly in November 2025. In an open letter dated February 5, the Cocoa Farmers Association of Nigeria and the Cocoa Farmers Alliance Association of Africa expressed deep concern over what they described as the “disappearance” of the bill, warning that the prolonged silence is creating uncertainty for farmers, exporters, processors, and investors across the cocoa value chain.

The bill, transmitted by the Tinubu administration to establish a National Cocoa Management Board, was intended to coordinate cocoa production, enforce quality standards, and strengthen Nigeria’s position in the global cocoa market. It was formally received by the Senate on November 10, 2025, and read for the first time in the House of Representatives on November 13. However, in a dramatic turn, the President requested lawmakers to halt further legislative action. In a letter dated November 12, read on the Senate floor by Senate President Godswill Akpabio, President Tinubu asked the National Assembly to “stand down the legislative actions on the bill,” citing the need for broader stakeholder consultations. Since then, no official update has been issued on whether the bill is being revised, reworked, or quietly abandoned.

The lack of clarity has fuelled intense debate within the sector. Farmer groups warn that public claims suggesting the revival of a cocoa board are at odds with the absence of any legislative backing. According to CFAN and COFAAA, the uncertainty is destabilising an already fragile sector. Without a clear institutional framework, they argue, Nigeria risks persistent challenges in production coordination, quality assurance, traceability, and export competitiveness. The groups urged the Federal Government to either swiftly reintroduce the bill or clearly communicate its intentions, warning that prolonged delays could erode investor confidence and widen Nigeria’s competitive gap with leading cocoa producers such as Ghana and Côte d’Ivoire.

While there is broad agreement on the need for stronger governance in the cocoa sector, stakeholders remain sharply divided over the form such intervention should take. The Chairman, Board of Trustees of the Federation of Agricultural Commodity Associations of Nigeria, Dr. Victor Iyama, and others have rejected any attempt to revive a cocoa marketing board. Drawing on what he described as painful historical lessons, Iyama warned that a return to a marketing board structure would be “disastrous” for farmers.

“Our elders fought for the scrapping of the cocoa marketing board. They did it because farmers were suffering. They suffered a lot. They were not being paid. The marketing board members were feeding fat, buying expensive cars and building houses for themselves,” he said. Iyama recalled that Nigeria’s cocoa production collapsed under the old system, falling from about 400,000 tonnes to as low as 92,000 tonnes, as frustrated farmers abandoned their plantations and cut down cocoa trees. He added that the coffee sector fared even worse, with coffee trees “completely annihilated” under similar policy failures.

According to Iyama, the liberalised market that followed the abolition of the marketing boards has delivered far better outcomes for Nigerian farmers. “Look at Ghana. Are the farmers happy? The answer is no. The farmers in Nigeria are getting the best prices because they are free to dictate. And that is the way it should be,” he argued. While rejecting a marketing board outright, Iyama said he would support the creation of a professionally run management committee, provided it is funded by member organisations rather than through levies imposed on farmers. He stressed that any such body must be strictly limited in scope. “They must not be involved in buying and selling of any commodity. They must not,” he emphasised.