Macroeconomic crisis, conflict, and flooding expected to heighten food assistance needs

• Conflict in northeast Nigeria continues to drive population displacement and disrupt cultivation, income-generating activities, and market access. The macroeconomic crisis, atypically high staple food prices, and low household purchasing power severely limit access to food as households enter the peak of the 2023 lean season. Meanwhile, significant rainfall deficits and increased targeted attacks on farming communities in parts of the northeast are expected to negatively impact main-season production. In the highly inaccessible areas of Abadam, Bama, Guzamala, and Marte LGAs, which have limited or no access to humanitarian assistance, minimal market functionality, high dependence on wild foods consumption, and poor access to health facilities amid high seasonal disease prevalence, Emergency (IPC Phase 4) outcomes are likely. In urban areas, displaced and relocated households remain highly market reliant amid significantly limited access to income, and households likely face Crisis (IPC Phase 3) outcomes. Meanwhile, households in IDP camps continue to receive humanitarian assistance that prevents more severe outcomes, driving Stressed! (IPC Phase 2!) outcomes.

• In northcentral Nigeria, farmer/herder clashes in Benue and Plateau states have intensified, with the frequency and fatality of incidents higher in the second quarter of 2023 than in the same period in 2022. Between May and July in Mangu LGA, Plateau state, clashes in roughly 50 villages have resulted in the displacement of thousands of people, extensive destruction of farmland, loss of livelihoods, and the death of an estimated 300 people. Similar attacks have also occurred in Kaduna and Niger states in July. In northwest Nigeria, kidnappings have increased in the second quarter of 2023 compared to the same period in 2022 due to the expansion of the territory of control of bandit groups. Entering peak lean season, food access is heavily constrained for purchase-dependent households in conflict-affected areas, likely driving Crisis (IPC Phase 3) outcomes. In some areas with limited market functionality, mobility restrictions due to insecurity, and household asset depletion, some poor households are expected to use severe coping strategies and face large food consumption deficits characteristic of Emergency (IPC Phase 4) outcomes.

• The macroeconomic crisis escalated in July due to further increases in fuel prices, alarmingly high staple food prices, the devalued Nigerian Naira (NGN), and record-high inflation. Headline inflation reached 22.79 percent in June, up from 22.41 percent in May, primarily driven by high food inflation. In June 2023, Maize prices were roughly 15 to 30 percent higher in Dawanau, Bodija, Kaura Namoda, and Maiduguri markets than last June, and maize prices were higher than the five-year average across all monitored markets. Fuel prices increased again in mid-July, and according to FEWS NET monitors, prices reached roughly 630 Nigerian Naira (NGN)/liter in some areas, a 15 to 20 percent increase month-on-month since the initial price spike in early June. As of July 31, the NGN exchanged at 775 NGN/USD, slightly higher than 753 NGN/USD on June 30 and nearly 70 percent higher than in early June, at 460 NGN/USD at the official window. The high fuel, transportation, and food prices have increased the proportion of total household expenditure on essential food items and increased the use of coping strategies such as consuming less preferred food and consuming less food per meal, particularly among market-reliant households.

• Main season cultivation is underway across the country, with localized disruptions due to flooding in central and southern states, dry spells and conflict in many northern states, and nationally above-average input prices in July. In early July, flooding in coastal and central Nigeria, particularly Ondo, Oyo, Osun, Ekiti, Rivers, and Cross River states, negatively impacted crop growth and infrastructure and drove population displacement. The Nigerian government triggered a national flood alert and response plan for 14 coastal and central states to avert further damages, displacement, and loss of lives ahead of the peak flooding period, which typically begins in August. In northcentral and northeast Nigeria, significant rainfall deficits and prolonged dry spells from late June to late July have reportedly delayed planting and caused moisture stress in localized areas, which is expected to negatively impact seasonal production if abnormal dryness continues into August.

• In mid-July, the government declared a state of emergency on food insecurity to address the high food prices following the removal of the fuel subsidy at the end of May. Some of the new proposed measures involve using the funds saved by the lifting of the fuel subsidy to distribute fertilizer and staple foods to farmers and vulnerable households; release 200,000 metric tons of grains from the national food reserves to help stabilize prices; increase protection for farmers to enable safe access to farmlands in conflict-affected areas; allocate 500,000 hectares of government land for farming; as well as provide cash-based transfers of an estimated 8,000 NGN monthly to 12 million poor households for six months. These measures, coupled with the reported government investment in expanding public transportation, could boost food production and slightly decline transportation and staple food prices in the medium to long run. However, the implementation timeline for these measures will likely determine the extent of impact on 2023 main season production and access to food and income for poor households.

Recommended citation: FEWS NET. Nigeria Key Message Update July 2023: Macroeconomic crisis, conflict, and flooding expected to heighten food assistance needs, 2023.