• Cost of rams, cows jumps by over 50 per cent ahead of celebration
• Food vendors decry rise in cost of items, low patronage
• Economists seek government’s intervention to fix supply constraints
• Insecurity, flooding blamed for rising food insecurity
With the recent petroleum subsidy removal, which has triggered a fresh spike in food prices, millions of Nigerian Muslims have expressed displeasure at rising deprivation, which they said, could ruin Id el Kabir for millions of faithful.
They complain that while economic hardship has reduced their earnings, the falling purchasing power due to escalating prices has made a mess of their budgets, with many resorting to borrowing or begging to take care of their responsibilities.
The celebration is becoming elusive for many faithful as they grapple with rising inflation and low purchasing power, which have deprived them of basic needs.
Afolabi Olaniyan, a young man who works with a microfinance bank turned up at Gbagada livestock market, Lagos, with N150,000. He left the market with a complaint rather than a ram. He told The Guardian that he had visited more than four livestock markets and could not find any price close to his budget.
As of yesterday, the price of a moderate-sized ram is N250,000 while a cow ranges from N300,000 to N1.3 million, depending on the size.
As of May, the food segment of the consumer price index (CPI) was 24.6 per cent. But some food items have increased much over 50 per cent in the past year, according to findings by The Guardian. The recent fuel subsidy removal, which has increased the cost of commuting by over 100 per cent in some cities, has worsened the price crisis.
At the abattoir in Bariga market, butchers lamented low consumer patronage. Idris Musiliu linked the challenge to harsh economic conditions and poor purchasing power of the consumers, noting that sales were a lot better last year.
Musiliu also noted that most people already got the things they needed for the celebration way earlier in the month, in anticipation of a possible increase in prices.
“Last year, even people who were travelling came to buy meat. The market was filled up. But this time, it is different,” he said.
A ram seller at Olorunfemi Cow Market, LASU road Egan, Akinola Olorunfemi, attributed the increase in the cost of the cows and rams to the high cost of transportation occasioned by the recent removal of subsidy on PMS.
“Subsidy removal affected the prices of a cow because formerly, a trailer is 800, 000 and the highest then was N1.2million but now it’s N1.8m and N2 million, so we will need to deduct those prices from the livestock; this led to the increase in ram prices,” he said.
Another seller, Olayinka Ibrahim, at Iyana-Iba Cow Market said the tripled increase in prices of the cow feeds coupled with a high cost of transporting the cows led to an increase in the prices of the animals.
At Idimu, Alimosho area, sellers blamed subsidy removal for the price increase, saying the cost of livestock feed has increased.
A ram seller, Ahmed, said the increase in the cost of rams and cows is high as compared to last year. He put the year-on-year change in price at about 50 per cent.
“Last year, a ram sold at N200,000 in the village. It is now N300,000. You must feed the ram apart from the high cost of transportation. A sack of animal feed is N8,000, even in rural areas. It was sold at half the price last year. All these costs must be factored into the selling price,” he said.
Prices of foodstuffs are also becoming outrageous. A medium-sized basket of tomatoes costs N28,000 as against N10,000 it sold at the beginning of the year while a derica of tin tomatoes, has increased from N700 to N800.
For a crate of medium size eggs, the price has risen to between N1,900 and N2,000 this time last year to an average of N2,400 while a carton of noodles, which was sold between N2,800 and N2,900, is N3,500.
Abibat Bello lamented that patronage has also dropped following the increase in the prices of food.
Speaking on her preparation for the celebration, she said: “I am not preparing for any celebration. Where is the money? Last week I sent someone to the market to help confirm the price of pepper for a small basket and she told me it was N20,000. Today the person told me it is N30,000. This means I won’t cook anything for the celebration. I will only serve drinks to visitors,” she said.
Another foodstuff seller, Mary Adeyemi, said a 50kg bag of rice which was sold for N28,000 before the subsidy removal is now 35,000 and is expected to still increase.
Prices have also changed remarkably following the subsidy removal. Mrs. Adeyemi said a bag of yellow garri, which was sold for N18,000 now costs N21,000
Akinyemi said a kilo of frozen chicken has increased from N2,200 to N2,400, adding that a kilo of Turkey which was N3,400 now sells at N3,800.
For frozen fish, a kilo of Titus, which was N2, 200 has increased to N2,400 while Kote rose from N1,500 to N1,800.
She said a paint bucket of sugar, which was sold between N2,800 and N3,000 is now sold for N4,000.
Adeyemi said sales have dropped due to low patronage, adding that customers complain about the high prices of foodstuff.
The founder of a catering service, Meals by Peace Catering Services, Peace Adewole, said there is about a 50 per cent increase in some food items in the past month, a situation that has affected the survival of households.
She said a 3.5 litres bowl of stew which was between N7,000 and N8,000 is currently going for between N16,000 to N17,000, adding that the increase is due to the rise in the price of a bowl of pepper which was sold N6,000 and now presently N20,000.
Adewole said Salah is not the only cause for the increase in the price of foodstuff, adding that the subsidy removal is a major cause.
She said the masses are bearing the brunt of the impact, adding that some of the food items are scarce such as tomatoes and pepper.
She said those food items available are sold for an exorbitant price.
Adewole said a 3.5 litre bowl of egusi soup which was sold for around N9,000 to N10, 000 is now sold for N20,000, while that of Ogbono which was sold for N8,000 is now N20,000.
She said Ogbono is now the new gold, while stockfish and crayfish and other items are expensive.
Adewole said patronage is on a decline, explaining that only customers whose companies increased their salaries continue to patronise her, while those who have not experienced an increase in salary are finding it difficult to buy.
She said customers who have wedding celebrations are now cutting down on their budget, while companies who train their staff are cutting down on logistics for feeding.
Adewole said two companies that paid for her catering service earlier in the year for their staff training later this year, have now postponed their events because of the increase in the initial budget.
In response to the hike, some buyers have expressed their anger and frustration, stating that the removal of fuel subsidies by the government has affected every aspect of life, including the cost of living, transportation, and now religious obligations.
According to them, the biting effect of economic realities has also complicated their decision on whether or not they would be able to afford rams or cattle for the sacrifice. This, they said, is because they have to weigh their decision against other pressing issues demanding equal attention.
A buyer, Bola Ajibola, told The Guardian that the rising cost of rams and cows is putting undue financial strain on many families.
“It’s important for us to remember the true meaning of the festive season and to ensure that everyone can participate without being burdened by these costs,” she said.
Speaking with a resident at Egan, Aderonke Adenekan, told The Guardian that the removal of fuel subsidy has had a significant impact on the cost of living, and this has now extended to religious obligations, with the increase in the cost of animals required for sacrifices during the festival
“The prices of cow are too high and not encouraging at all, imagine someone who has been slaughtering ram in the past would not be able to this year just because of the increase in price, we still need to buy other things to support the ram like rice and other ingredients which is also on the high side,” she said
Despite the increased cost, some Nigerians have said they will not be deterred from their religious obligation, stating that they will find a way to purchase the animals for sacrifice.
Food prices have been astronomically in Nigeria since August 2019 when the country shut its borders from neighbouring countries and continued unabated owing to supply chain disruptions induced by the Covid-19 pandemic and the recent flood situation
Analysts said since the inflation figure is a lag indicator, the impacts of fuel subsidies that trigger more than a 250 per cent increase in the pump price of petrol have not been priced in.
NBS said in the report that Nigeria’s headline inflation sustained its uptrend in May, increasing by 19 basis points to 22.41 per cent year on year.
Others are clothing and footwear at 1.70 per cent; transport at 1.45 per cent; furnishings, household equipment and maintenance at 1.12 per cent and education at 0.88 per cent, and health at 0.67 per cent.
“Miscellaneous goods and services at 0.37 per cent; restaurant and hotels at 0.27 per cent; alcoholic beverage, tobacco and kola at 0.24 per cent; recreation and culture at 0.15 per cent and communication at 0.15 per cent.”
It said the percentage change in the All-Items Index in April 2023 was 1.91 per cent on a month-on-month basis.
Director-General of the Centre for the Promotion of Private Enterprise (CPPE), Muda Yusuf, said like, in many other parts of the world, inflationary pressures in the Nigerian economy are yet to abate.
“It remains a major concern for stakeholders in the economy. The key drivers of food inflation have not changed over the last few years. They include the following: the depreciating exchange rate, rising transportation costs, logistics challenges, forex market illiquidity, hike in diesel cost, climate change, insecurity ravaging farming communities and structural constraints to economic activities.
“Others are Fiscal deficit financing by the CBN is also a significant factor fueling inflation through high liquidity injection into the economy. Tapering of monetary easing in the advanced economies is also driving imported inflation and the depreciation in the exchange rate.”
Vice President of Highcap Securities, David Adonri, said one major imperative that would help to address the rising cost of food commodities is for governments at all levels to urgently call for an assessment of the level of damages caused by the flood and take necessary steps to tackle it and curtail future occurrence.
According to him, the recent flooding challenge is a threat to food security in the country as farms and farming communities have been cut off by flood and farmlands submerged in almost all the states in the country.
He called for more efforts from the apex bank towards ensuring that farmers benefit from the existing government’s agricultural schemes, as well as create fresh incentives to make their impact more meaningful at this critical time.
Adonri noted that heightened insecurity has already threatened food production in different parts of the country and has, to a significant level, pushed farmers off their farmlands.