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Nigeria Market Monitoring Bulletin

  • Special Report
  • Nigeria
  • March 14, 2017
Nigeria Market Monitoring Bulletin

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  • Key Messages
  • Preface

  • Preface

    In June 2016, FEWS NET released an alert describing the national and regional implications of declining global crude oil prices on the Nigerian economy and subsequent currency depreciation since 2015. Within the context of this national economic shock, more than 3 million people in Northeast Nigeria already face significant food insecurity due to the Boko-Haram conflict. The Nigeria Market Monitoring Bulletin provides a summary of emerging market trends in Nigeria and the broader region. 

    Key Messages
    • Despite recent increases in foreign reserves and direct intervention by the Government of Nigeria (GoN), the exchange rate gap between official and parallel rates remains. Structural challenges in the economy persists and continue to drive higher prices of both imported foods as well as local substitutes.

    • The Government of Nigeria direct support to agricultural production financing (Anchor Borrowers program) is yielding intended results through expansion in area cultivated as well as increased yield. If this is sustained, availability and access to food will improve at both household and markets levels in the coming lean season as the availability of imports are constrained by a lack of forex as well as policy measures to curb imports.

    • Despite the anticipated increase supplies, high transaction and transportation costs remained a great concern in Nigeria. The proposed “grain by rail” may not achieve much considering the collapsed state of rail system in the country. Local Prices are expected to remain at very elevated levels in the medium term, resulting in atypical trade flow patterns (within the country and between Nigeria and the broader region).

    • Though there are some improvements in the security situation in North East of Nigeria, trade flows with other parts of the country remained impacted as commodities previously sourced from the North East to South West and South East markets are now mostly procured from markets in the North Central and North West states.

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