AFEX predicts higher prices for core grains and advocates for African food balance sheet in new report

Nigerian commodities exchange releases 2021 Annual Crop Production report to boost agricultural data and guide financing and policy decisions

Lagos, Nigeria – 8 November 2021. Nigeria’s core grain prices have been projected to trend upwards in the new season due to persistent gaps between commodity supply and demand, according to a new report by commodities exchange firm AFEX. The 2021 crop production survey report also forecasts an increase in production levels across six commodities: maize, sorghum, soybean, paddy rice, ginger, and sesame.

AFEX’s annual crop production report seeks to provide robust market intelligence for the many key players in the agricultural value chain, with the data also being used to produce forecasts of area, yield, production, value and stock for major crop products. The report provides insight into the top concerns faced by farmers, showing that access to finance, inputs and quality seeds remain major challenges.

Higher prices were forecasted across all commodities in the report despite the growth in production levels. This was due to increased production levels not being significant enough to surmount demand pressures across commodity value chains. The report highlights maize as being the most vulnerable to demand pressures due to a 3% increase in production levels over that of the previous year, falling way below the demand gap for the commodity.

The AFEX 2021 crop production report was developed by surveying over 10,000 farmers and tracking market prices across over 200 markets in Nigeria, primarily focusing on the impact of land usage, inputs, weather, and subsequently the output expectations of farmers.

Speaking on the importance of the report for the agricultural sector, AFEX Chief Operating Officer, Akinyinka Akintunde, stated that “a lack of data in the sector leads to less-than-optimal decisions, resulting in productivity losses, agricultural income losses, and eventually increased hunger and poverty."

He continued: "Agriculture suffers from significant data gaps, harming millions of the world's poorest people. The situation is particularly challenging in sub-Saharan Africa, where nearly half of nations lack comprehensive data on the industry and farmers. Data will aid in informing insight-driven policies aimed at increasing production levels."

Reiterating Akinyinka's position, the report also advised that Africa should prioritize developing a food balance sheet as a necessary first step toward achieving food security across the continent.

“We must leverage technology to accurately track the supply and demand of food, collate data on the activities of input providers, urban and rural farmers, importers, aggregators, processors, wholesalers, distributors, retailers, caterers and food banks,” the report stated.

About AFEX

AFEX harnesses Africa's commodities and talent to build shared wealth and prosperity. Its infrastructure and platform investments work to unlock capital to power a trust economy in Africa's commodities markets. Since its inception in 2014, AFEX has developed and deployed a viable commodities exchange model for the West African market, and is on track to impact one million producers; providing services in productivity and value capture and access to finance and markets. By deploying an efficient market system, the company will facilitate trade with Africa worth over USD500 million in the next five years.

AFEX’s vision is to be the reference point for commodities in Africa. To achieve this goal, AFEX looks to introduce products that de-risk the sector, drive financial inclusion for rural communities, develop technology for data collection and market access, and enable capital deployment.