Nigerians consume N25bn worth of food daily

raw food

Results from a new survey released yesterday show the enormous opportunities open to investors in the Nigerian food market as her citizens reportedly spend as much as N25.2 billion feeding themselves daily.

Analysts say the huge food expenditure is not surprising, giving the large and growing population, as well as the country’s long standing economic growth that has seen a rising middle class, able to spend on a variety of food items.

This is going by latest reports by NOI Polls, which state that about 80 percent of Nigerians spend at least $1 on food daily, with only 20 percent spending less.

Following this estimate, it means that 80 percent of the country’s current population of 175 million, which is about 140 million people, each spends N160 per day on food, amounting to N22.4 billion. The remaining 35 million people spend about half a dollar, estimated at N80, which amounts to N2.8 billion per day, making a total daily food spend of N25.2 billion by the country’s populace.

Orimadegun Agboade, vice president, Nigerian Association of Small and Medium Enterprises (NASME), says that this level of food consumption in Nigeria should be pleasantly alarming for investors.

“It is a good time for investors to come and tap into the food industry. But there are challenges because these food investors may not be able to provide food that would be cheap enough for the masses. But I still believe investors need to explore these possibilities,” Agboade said.

“I know of a teacher who left teaching to sell amala to mechanics, bus conductors, drivers and so on. Her shop is always filled up and she has been able to buy a car in such a short while. So, I think investors should leverage on this,” he said.

Nnamdi Anakwe of Foraminifera Market Research also explained the reason that a seemingly small reduction in food importation in recent years always has a massive impact on the Nigerian economy.

“Because Nigeria is so big in terms of population and going by the rebased GDP, any small change in quantity and monetary value always ends up not being so small and having a massive impact on the people,” Anakwe said.

“Also, the rising trend to shop in much more convenient areas by Nigeria’s growing middle class is bringing most of the local foods, which had hitherto been traded informally, to be traded in the formal sector in highbrow shops, and this is having a good effect on the economy,” he said.

This call for investors to leverage on food business portends massive investment. Going by these figures, all the food consumed in the country in one year amounts to N9.2 trillion, of which N1.3 trillion, which is 14 percent, is imported.

According to industry watchers, attempts by the government to reduce importation and increase domestic food production in recent years have been having a massive positive effect on the economy in terms of new businesses and creation of about 1.8 million jobs.

The analysts believe that it is because about 70 percent of the Nigerian populace, who actually live on $1 per day, grow their own food, leaving about 30 percent to be served by the domestic formal sector and imports.

Going by a United Nations report which shows that about 70 percent of Nigerians live on $1 a day, almost N20 billion worth of the food consumed by this about 122 million people is produced through subsistence farming.

Investigation shows that these Nigerians as family units, or households, rear crops such as vegetables, yam and cassava for the production of garri, akpu, fufu and elubo, as well as livestock such as local chickens and goats. Some people, particularly those living in rural areas, also fish in water masses to get fish to eat. What they produce may not meet globally acceptable levels of feeding requirements, but these prevent them from dying of hunger.

So, apart from the estimated N20 billion food grown through subsistence farming, even about half of the remaining N5 billion worth of food is traded informally.

According to analysts, players in the formal sector who want to tap into this massive food market should explore ways of increasing the current food production output, storage, processing and supply of the food produced within the country in very cost-efficient ways because a very huge market exists for hygienically produced food, supplied with convenience to over 50 million people who buy the food they consume

Source:BusinessDay is your one-stop online news magazine blog. We report credible information as they happen. Follow us on Facebook and Twitter to get Latest Information.

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