Nigerians Groan Over Food Prices As Inflation Hits 33.69%

The average price of imported food commodities to Nigeria rose to its highest level, reaching 34 per cent in one year between April 2023 and April 2024, official data have pointed out. 

This represents a 200 basis point increase from the 32 percent recorded in March 2024, according to an analysis of the Consumer Price Index report released by the National Bureau of Statistics on Wednesday.

Africa Today News, New York recalls that the Federal Government had a weeks ago, ruled out the importation of food as part of strategies to address the high costs of foodstuffs and the economic hardship troubling the country.

However, internal and external factors including global supply chain shocks following the Covid-19 pandemic and the Russia-Ukraine war, surge in global oil prices, FX scarcity and subsequent depreciation of the local currency have increased the nation’s dependence on food imports.

In April, Nigeria saw its inflation rate rise for the 16th straight month, spurred by a threefold surge in electricity tariffs and increased transportation expenses.

This represents a month-over-month increase of 0.49 per cent points in the headline inflation rate but was lower than the median estimate of eight economists in a Bloomberg survey of 34.2 per cent.

Read Also: 5.9M Nigerian Children Face Acute Food, Nutrition Crisis— UN

Comparing year-on-year data, the inflation rate in April 2024 was 11.47 percentage points higher than in April 2023, where it stood at 22.22 per cent. This indicates that the headline inflation rate has risen significantly over the past year.

A report by Financial Derivatives, however, stated that the outcome of the national data did not take into consideration petrol scarcity. Next month’s reading will capture the effect.

The acceleration raises the prospect of another interest-rate hike when the central bank’s monetary policy committee meets next week. It’s already lifted borrowing costs to a record high to curb price growth and boost the naira.

Core inflation, which excludes farm produce and energy costs, quickened to 26.8 per cent from 25.9 per cent and food price growth accelerated to 40.5 per cent in April from 40 per cent a month earlier.

Additionally, on a month-to-month basis, the inflation rate for April 2024 was 2.29 per cent, which is 0.73 per cent lower than the 3.02 per cent recorded in March 2024.

This suggests that the rate at which prices increased in April 2024 was slower than the rate in March 2024.

The report read, ”In April 2024, the headline inflation rate increased to 33.69% relative to the March 2024 headline inflation rate which was 33.20 per cent. Looking at the movement, the April 2024 headline inflation rate showed an increase of 0.49% points when compared to the March 2024 headline inflation rate.

“On a year-on-year basis, the headline inflation rate was 11.47 per cent points higher compared to the rate recorded in April 2023, which was 22.22 per cent. This shows that the headline inflation rate (year-on-year basis) increased in April 2024 when compared to the same month in the preceding year (i.e., April 2023).

“Furthermore, on a month-on-month basis, the headline inflation rate in April 2024 was 2.29 per cent, which was 0.73 per cent lower than the rate recorded in March 2024 (3.02 per cent). This means that in April 2024, the rate of increase in the average price level is less than the rate of increase in the average price level in March 2024.”

Similarly, the food inflation rate reached 40.53 per cent on a year-on-year basis, marking a substantial increase of 15.92 percentage points from the 24.61 per cent recorded in April 2023.

This significant rise in food inflation can be attributed to higher prices for several items including millet flour, garri, bread, prepacked wheat flour, and semovita, all of which belong to the Bread and Cereals class, as well as for yam tuber, water yam, and cocoyam and others.

For the year ending in April 2024, the average annual rate of food inflation stood at 32.74 per cent, representing an increase of 9.52 percentage points over the 23.22 per cent average annual rate recorded in April 2023.

Africa Today News, New York

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