Economy
Sekibo Frowns at Nigeria’s High Wheat Import Bill
By Dipo Olowookere
The Managing Director/CEO of Heritage Bank, Mr Ifie Sekibo, has expressed concerns over the high wheat import bill of Nigeria, noting that it was for this reason the bank was collaborating with the Central Bank of Nigeria (CBN) to adopt a novel approach to boost local production capacity.
Speaking at the launch of the Wheat Seed Multiplication Project tagged the Brown Revolution Initiative in Jos, Plateau State, the renowned banker said the partnership with the central bank is expected to add about 750,000MTs via rain-fed cultivation and reduce annual import by 60 per cent.
He further said the strategic partnership would help reverse the huge amount of foreign exchange (FX) used to bring the wheat into Nigeria and upscale its domestic production to close the wide supply gap in the agricultural space.
As part of the bank’s efforts to support the high yield seed variety to national wheat seed stock, Mr Sekibo, represented by the Head Agricbusiness and Export, Ugonwa Ikegwuonu, explained that the lender sets out to cultivate a total of 1,000 hectares of farmland at the end of the year with at least producing about 5 tonnes of wheat seeds per hectare in terms of yield.
“We set out to cultivate a total of 1,000 hectares of farmland but at the end of the day because of time constraints & other challenges, we have been able to cultivate 357 hectares.
“The crops according to the project manager are doing very well and in a few weeks they will be ripe for harvest, in fact, part of the farm is already ripe for harvest. So, we set out with this partnership with two anchors which we call service providers,” he further explained.
Also commenting, the Deputy Governor, CBN, Mr Edward Adamu, stated that the short-term benefit is the addition of about 2,000 metric tonnes (MT) of high yield seed variety to the national wheat seed stock which is 20,000MT currently.
According to him, this effort has the potential to add about 750,000MT of wheat annually through rain-fed cultivation.
He noted that estimated that only one per cent or 63,000MT of wheat, out of the five to six million metric tons of wheat consumed annually was produced locally.
The Governor of Plateau State, Mr Simon Lalong, while also speaking at the event, affirmed that Nigeria was on the path of agricultural food sufficiency with the ‘Brown Revolution’ the rain-fed wheat would help curtail the $2 billion spent on importation of wheat.
He further noted that the target of his administration was to attain zero importation of wheat, attain wheat sufficiency in the economy and commence exportation to raise foreign reserve.
President of Wheat Farmers Association of Nigeria, Mr Salim Muhammad, stated that they have a good understanding with Heritage Bank for its proactive approach to the objective of the rain-fed wheat production in the agriculture value chain.
“I assure you that at the end of this programme, by next season, it will be a different scenario/story because we are now doing it on a very small scale but I’m sure by next season, the real revolution will start off and it will be seen all over Nigeria. Because currently, we are producing wheat in 16 wheat-producing states.
“By the coming of this wheat dry season, seeds available and practicable; we are going to expand our scope to cover other areas that can produce wheat during the dry season.
“I’m not saying that we are going to cover the whole 36 states of the country, but I assure you, by next season we will be thinking of about 20 to 27 states that we have,” he stated.
Business Post reports that the scheme was put in place to meet high demand amid the poor production capacity of wheat in the country.
The novel initiative that will boost wheat production annually is being processed via rain-fed cultivation, as this approach is actually the first-ever wheat programme that it would be planted in the wet season and as part of the pilot phase of the initiative, Heritage Bank financed the first-ever large-scale rain-fed wheat production in Nigeria.
By Adedapo Adesanya
Energy stocks influenced the 4.76 per cent loss recorded by the NASD Over-the-Counter (OTC) Securities Exchange on Friday, December 5.
The culprits were the duo of 11 Plc and Nipco Plc,with the former shedding N32.17 to end at N291.83 per share compared with the previous day’s N324.00 per share, and the latter down by N21.00 to sell at N195.00 per unit versus the previous session’s N216.00 per unit.
Consequently, the NASD Unlisted Security Index (NSI) slumped by 170.16 points to 3,401.37 points from 3,571.53 points and the market capitalisation lost N101.81 billion to close at N2.035 billion from the N2.136 trillion quoted in the preceding session.
The OTC securities exchange suffered the decline yesterday despite the share prices of three companies closing green.
Central Securities Clearing System (CSCS) Plc was up by N1.80 to close at N39.80 per share compared with Thursday’s price of N38.00 per share, Air Liquide Plc appreciated by N1.09 to N11.99 per unit from N10.90 per unit, and FrieslandCampina Wamco Nigeria Plc grew by 78 Kobo to N56.57 per share from N55.79 per share.
During the session, the volume of transactions rose by 6,885.3 per cent to 18.2 million units from 4.3 million units, the value of transactions ballooned by 10,301.7 per cent to N389.7 million from N347.2 million, but the number of deals declined by 29.7 per cent to 26 deals from 37 deals.
Infrastructure Credit Guarantee Company (InfraCredit) Plc ended the day as the most traded stock by value on a year-to-date basis with 5.8 billion units worth N16.4 billion, followed by Okitipupa Plc with 170.4 million units valued at N8.0 billion, and Air Liquide Plc with 507.5 million units worth N4.2 billion.
InfraCredit Plc also finished the day as the most traded stock by volume on a year-to-date basis with 5.8 billion units transacted for N16.4 billion, followed by Industrial and General Insurance (IGI) Plc with 1.2 billion units sold for N420.2 million, and Impresit Bakolori Plc with 536.9 million units worth N524.9 million.
By Adedapo Adesanya
The Naira depreciated further against the US Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Friday, December 5, as FX demand pressure mounts.
The Nigerian currency lost N2.60 or 0.18 per cent against the greenback to close at N1,450.43/$1 compared with the previous day’s N1,447.83/$1.
Equally, the domestic currency declined against the Pound Sterling in the official forex market during the session by N4.48 to trade at N1,935.45/£1, in contrast to Thursday’s closing price of N1,930.97/£1 and shrank against the Euro by 43 Kobo to end at N1,689.17/€1 versus the preceding session’s rate of N1,688.74/€1.
Similarly, the local currency performed badly against the US Dollar at the GTBank FX counter by N2 to close at N1,455/$1 versus Thursday’s N1,453/$1 but traded flat at the parallel market at N14.65/$1.
As the country gets into the festive period, pressure mounted on the local currency reflecting higher foreign payments and lower FX inflows.
However, there are expectations that the Nigerian currency will be stable, supported by interventions by to the Central Bank of Nigeria (CBN) in the face of steady dollar Demand and inflows from Detty December festivities that will give the Naira a boost after it depreciated mildly last month.
Traders cited by Reuters expect that the Naira will trade within a band of N1,443-N1,450/$1 next week, buoyed by improved FX interventions by the apex bank.
As for the crypto market, it was down yesterday due to profit-taking associated with year-end trading. However, the December 1-Year Consumer Inflation Expectation by the University of Michigan fell to 4.1 per cent from 4.5 per cent previously and 4.5 per cent expected. The 5-Year Consumer Inflation Expectation fell to 3.2 per cent from 3.4 per cent previously and 3.4 per cent expected.
With the dearth of official economic data of late, these private surveys have taken on a new level of significance and the market banks of them to make decisions.
Cardano (ADA) depreciated by 5.7 per cent to $0.4142, Dogecoin (DOGE) slid by 5.1 per cent to $0.1394, Ethereum (ETH) dropped by 3.9 per cent to $3,039.75, Solana (SOL) declined by 3.8 per cent to $133.24, and Litecoin (LTC) fell by 3.7 per cent to $80.59.
Further, Bitcoin (BTC) went down by 2.6 per cent to sell at $89,683.72, Binance Coin (BNB) slumped by 2.2 per cent to $883.59, and Ripple (XRP) shrank by 2.1 per cent to $2.04, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 each.
By Adedapo Adesanya
The oil market was up on Friday on increasing expectations the US Federal Reserve will cut interest rates next week, which could boost economic growth and energy demand.
Brent futures rose by 49 cents or 0.8 per cent to $63.75 per barrel and the US West Texas Intermediate (WTI) futures expanded by 41 cents or 0.7 per cent to $60.08 per barrel.
Investors digested a US inflation report and recalibrated expectations for the Federal Reserve to reduce rates at its December 9-10 meeting.
US consumer spending increased moderately in September after three straight months of solid gains, suggesting a loss of momentum in the economy at the end of the third quarter as a lackluster labor market and the rising cost of living curbed demand.
Traders have been pricing in an 87 per cent chance that the US central bank will lower borrowing costs by 25 basis points next week, according to CME Group’s FedWatch Tool.
Investors also focused on news from Russia and Venezuela to determine whether oil supplies from the two sanctioned members of the Organisation of the Petroleum Exporting Countries and allies (OPEC+) will increase or decrease in the future.
The failure of US talks in Moscow to achieve any significant breakthrough over the war in Ukraine has helped to boost oil prices so far this week.
A loss of Venezuelan oil production in case of a US military intervention will materially impact global benchmark prices as the market will have to replace Venezuela’s heavy crude.
Venezuela is estimated to pump about 1.1 million barrels per day of crude oil at present, so if the US-Venezuela tension escalation into an invasion in the South American country, this volume of crude would be at risk.
Reuters reported that the Group of Seven countries and the European Union are in talks to replace a price cap on Russian oil exports with a full maritime services ban in a bid to reduce the oil revenue that helps finance Russia’s war in Ukraine.
Any deal that could lift sanctions on Russia, the world’s second-biggest crude producer after the US, could increase the amount of oil available to global markets, weakening prices.
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