• Fri. Sep 29th, 2023

How Nigeria’s Central Bank is working with state govts to develop agriculture

ByBassey Udo

Sep 24, 2019


The Central Bank of Nigeria (CBN) says it is collaborating with the 36 states governments of the federation to pool resources together to develop and grow agricultural potentials in the country.

The CBN governor, Godwin Emefiele, said in line with President Muhammadu Buhari’s directives, the bank has already identified ten key commodities in the states as key enterprises to be developed along the value chain to enhance the country’s agricultural development.  

The commodities include rice, cotton, oil palm, tomato, cassava, poultry, fish, maize, cocoa and livestock and dairy products.

The CBN te collaboration with the state governments will focus on boosting the production of identified agricultural commodities in the states, particularly those with high growth enhancement impact, create jobs, improve the capacity of industries, and conserve foreign exchange for the country.


With annual demand for palm oil in Nigeria at about 2.5million metric tons, the CBN governor said only 1.25m MT is produced locally,  leaving a  gap of 1.25m MT per annum, which is currently being met through imports.

He said the CBN oil palm initiative is aimed at closing the gap and also positioning Nigeria to incrementally export oil palm products to neighboring African countries and beyond.

Closing the gap, the CBN governor said, would require bringing about 312,500 hectares under modern cultivation at an estimated yield of 4 metric tons per hectare.

He said the bank has set a target to ensure a minimum of 1.4 million hectares of land is put under oil palm cultivation in three years.

So, he said the CBN has met with 14 State governors who pledged to make available 100,000 hectares of land each in their domain.

Currently, he said a total of 904,624 hectares of land are available in the states for allocation, while investors, to be funded from CBN’s intervention programme, have been matched with the States of interest to process necessary documentation and titling requirements.

So far, the CBN says it has disbursed about N30 billion through the deposit money banks to six oil palm companies, namely PZ Wimar, Biase Oil company Limited, Eyop, Okomu Oil company, Presco Oil Company, SIAT Limited, to support their expansion programmes. 

Also, another application for funding is being expected from Ada Palm in Imo State, while over 40 other investors across the country are being considered for the cultivation of  126,694 hectares palm plantation.

In addition, the CBN it has extended support to rejuvenate the Nigerian Institute for Oil Palm Research (NIFOR) in collaboration with the leading oil palm major companies to meet the seedling needs of investors in the subsector.


To revive the sector, Mr Emefiele said the CBN, through the Anchor Borrowers Programme, facilitated the cultivation of over 200,000 hectares of hybrid cotton distributed to 200,000 farmers in 26 States.

The benefitting states include Sokoto, Zamfara, Kebbi, Katsina, Kano, Kaduna, Yobe, Borno, Adamawa, Nasarawa, Jigawa, Oyo, Taraba, Gombe, Bauchi, Kwara, Niger, Kogi, Benue, Cross River, Edo, Delta, Ekiti, Ogun and Lagos.

He said the Bank is also spearheading the importation of over 6,000 metric tonnes of improved cotton seed, in addition to over 2,000 metric tonnes sourced locally. Total expected yield of cotton at the end of the current season is put at about 302,440 metric tonnes as a result of CBN’s intervention.

The CBN has also facilitated the commencement of distribution of inputs to cotton farmers in Katsina on May 6 this year, with a target is to work with the relevant interest groups to engage about 300,000 farmers to achieve 450,000 metric tons of cotton in three years.

Besides, a total of 20 ginneries in seven states, including Borno, Gombe, Kano, Katsina, Kebbi, Niger and Zamfara were identified as off-takers for the cotton financed by the Bank.

The ginners are to sell their lint to textile factories with the ultimate objective of producing textiles to meet the needs of the members of the uniformed services.

Funds have also been approved by the management of the bank to be disbursed through Bank of industry to help operate the ginneries.

As part of the engagement process, the Bank has also met with the Cotton, Textile and Garment Implementation Committee, comprising governors of Kano, Kaduna, Kebbi, the ministers for Agriculture, Trade and Investment and Power to drive the process of realizing the CBN objective.

Relying on Executive Order 003 of the Federal Government, the CBN said it engaged uniform services to buy into the cotton, textile and garment initiative of the Bank by locking in contracts for the procurement of uniforms, accouterments and other accessories from Nigerian Textiles and Garments Industry.

The Bank is also championing the drafting and adoption of an MoU between major interest groups, including members of the Armed Forces of Nigeria; Nigeria Customs Services; Nigeria Police; Nigeria Correctional Services; Nigeria Security and Civil Defense Corps, and the National Youth Service Corps (NYSC).


With Nigeria spending about $1.5 billion yearly on the importation of dairy products such as milk, yogurt, cheese and other milk derivatives, the CBN said it is determined to ensure the over 95 percent of milk products consumed in the country currently being imported, were produced locally.

Besides, the CBN said the dairy industry has huge potentials for the creation of millions of jobs and foreign exchange savings.

 In addition, it said the sector has an undeveloped meat processing infrastructure, declining tannery operations, inadequate large-scale private investments in cold storage and transportation, and insecurity arising mostly from pastoralists/farmers clashes, rustling, and other socio-economic challenges.

Considering that over 85 percent of Nigeria’s cattle, estimated at over 20 million, is owned and managed by the smallholder, subsistent and nomadic herdsmen, the CBN governor said the bank has resolved to integrate them in the scheme under the ABP.

In line with the CBN’s policy to discourage the use of Nigeria’s scarce foreign exchange for the importation of milk, the bank has supported four dairy products manufacturers to commence the process for the local production of milk.

The companies are FrieslandCampina WAMCO, Neon Agro, Chi Limited and Irish Dairywhich have already expressed interest to invest in Bobi Grazing Reserve in Niger State.

Bobi Grazing Reserve located in Mariga Local Government Area is part of 26 Grazing Reserves gazette under a livestock development initiative by the Niger State government in partnership with the CBN.

The reserve has a land area of 31,000 hectares, with about 700 families and 300,000 heads of cattle resident there for the pilot project.

So far, the CBN governor said FrieslandCampina WAMCO and Neon Agro have agreed to acquire 10,000 hectares of land each, while Chi Limited and Irish Dairy are to develop 4,000 hectares each for their local milk production project.

The remaining 3,000 hectares will be retained by the State government for its development programmes.

Already, as at last Tuesday, September 18, Mr Emefiele said FrieslandCampina WAMCO had cleared a total land area of 695 hectares, with 190 hectares already cultivated with pastures for the livestock.

Also, the company has completed a hydroponic centre and solar-powered borehole, while equipment for its Milk Collection Centre is awaiting installation.

Similarly, he said Chi Limited has also signed contracts for the clearing and planting of pasture on its allocated 4,000 hectares of land.

He said Niger State government on its part has cleared and fenced 63 hectares of land in two sites.

The sites have a Police post, administrative area, and veterinary clinic, with a primary school refurbished, while a Primary Health Care Clinic is under construction. Also, planting of pasture is currently in progress.

Besides, in Kaduna State, the CBN governor said Arla Group has existing projects in Damau, Amana, NAPRI Shika and Kagarko.

About N12 billion has also been invested in the development of 6,000 hectares of land in Damau Grazing Reserve under the Bank’s livestock development initiative.

In addition, he said Arla is currently refurbishing a milk processing plant and will soon commence milk off-take from 600 farmers in Kagarko.

Again, he said the Promasidor Group has commenced work on the 500 hectares land area granted consent to develop Ikun Dairy Farm Project in Ekiti State.

Apart from the deployment of 20 tractors for land preparations at the site, the company has also commenced the planting of pasture for the livestock.

For integrated Dairies Limited, an indigenous dairy company based in Jos, Plateau State, the company has engaged the Plateau State government and key interest groups on the development of Wase Grazing Reserve.

Nestle Plc has indicated interest in developing its dairy project in Abaji, in the Federal Capital Territory.

The CBN said it has contacted the relevant government departments to fast track land acquisition and issuance of title documents.


To meet the country’s tomato needs and domesticate production, the CBN said it held meetings with key tomato processing and packaging companies between June and August to find ways of stopping paste and puree smugglers and to make local production competitive.

During the meetings, the CBN governor said the apex bank agreed to support the acquisition of land to establish tomato turn-key projects in states with huge potentials its production.

In Jigawa State, he said Sonia Foods Limited has been allocated 2,380 hectares of land at Birniwa for its project, while the Bank is funding about 18,000 farmers under the Anchor Borrowers Programme (ADP) to produce hybrid tomato for processing by the company.

Again, Sonia Foods is setting up a 1,000 MT per day processing and packaging plant in Jigawa State with potentials to create 110,000 jobs.

Also, the CBN is funding about 40,000 farmers under the ABP to produce tomato to meet the needs of the 1,200 MT per day Dangote tomato processing plant in Kadawa, Kano State.

So far, the CBN has facilitated the procurement of inputs worth N4.18 billion for the initiative.

Similarly, the tomato processing plant owned by Savanna Integrated Farms in Gombe State is being reactivated with the support of the CBN and will soon commence operation.

About 18,000 farmers were cleared to participate as out-growers under the ABP to supply raw materials to the factory.


Despite Nigeria capacity as the world’s largest producer of cassava tubers with 53 million MT per annum, the CBN said the yield per hectare averaging 20 tonnes per hectare is very low compared to other jurisdictions and the country’s annual imports of over $600 million worth of cassava derivatives.

The CBN governor said the bank’s cassava initiative is to improve cassava productivity, stabilize prices and encourage local processing to generate employment.

So far, he said Kogi State government has set aside 1.35 million hectares of land for cassava cultivation, in addition to plans to establish a processing plant to produce ethanol.

He said the Bank is also discussing with the Rivers State government to support DADTCO, a 30,000 MT per annum capacity Cassava Processing plant, to start production.

To improve the cassava seed productivity, he said the Bank is collaborating with the International Institute for Tropical Agriculture (IITA) on the production and supply of cassava cultivars to increase yield to up to 40 tonnes per hectare.

Besides, he said arrangements are underway to support about 51,388 farmers to produce 830,820 metric tonnes of cassava tubers for some identified processors.

Again, the bank is considering modalities for the acquisition and deployment of mini-cassava processing machines to process cassava tubers intermediary products to enhance its life span to feed large scale processors. 


With Nigeria as the largest maize producer in Africa with about 11 million MT, the CBN said the country still has a deficit of about 4.5 million MT per annum.

Mr Emefiele said one of the steps the CBN has taken to ensure self-sufficiency in maize production is to support the Maize Association of Nigeria (MAAN) to mobilize its members to address this deficit. 

To further encourage in maize production, he said the Bank introduced the Maize Aggregation Scheme (MAS) to enable silo concessionaires have access to affordable financing to purchase locally produced maize from farmers. 

Other arrangements include several engagements with large corporates like Olam, Nestle, Grand cereals, Flourmills Limited to commence backward integration with the objective of producing to meet their needs.

The Bank has also disbursed about N5.38 billion to 41,237 farmers from 30 States of the Federation, and is currently collaborating with the 12 River Basin Development Authorities on the use of irrigable land in their areas of operation for dry season farming.


Nigeria’s current fish production stands at about 0.8 million tons, while the demand is about 2.7 million tons, giving a deficit of about 1.9 million tons, with annual fish importation bill at about $1.2 billion.

To reverse the trend, the CBN said it is currently engaging the coastal states governors to develop the blue economy to address the deficit as well as eradicate the huge import bill.


To deepen the poultry business in the country, the CBN governor said the bank is partnering with some tertiary institutions to pilot the “The University-based Poultry Production Programme” in 12 Universities across the six geo-political zones.

He said the objective is not only to build future agricultural entrepreneurs, but to make the universities able to improve their internally generated revenue.

For the pilot phase, Mr Emefiele said five Nigerian Universities, namely; Ahmadu Bello University (ABU), Zaria, Federal University of Agriculture Abeokuta (FUNAAB), Rivers State University, Port Harcourt, University of Nigeria, Nsukka, and University of Ilorin were enrolled.

These Universities have submitted revised proposal to their respective sponsoring banks.


On Rice development, the CBN governor said the bank has so far supported 849,480 farmers with N146billion funding across the country in the wet and dry seasons. 

Apart from its intervention through the ABP, he said the CBN is also working with other interest groups, including the Nigeria Customs Service to tackle the menace of smuggling of rice into the country.

The CBN has also financed the construction of rice mills to support food self-sufficiency and security.

In addition, Dangote Farms is constructing five mills – two in Jigawa State and one each in Kebbi, Zamfara and Sokoto.

Other rice mills financed by the Bank include the WACOT and Labana Rice Mills in Kebbi State, and Umza Rice Mill in Kano. 


He said, going forward, the CBN’s focus will remain on sectors that can create jobs on a mass scale, with closer attention to financing sectors that can help the country reduce its burgeoning import bill and conserve much needed foreign exchange.

He said the bank will maintain a keen interest in supporting the creation of an enabling environment to trigger private sector investment and curb the growing trend of medical tourism, which has depleted the nation’s foreign reserve.

“Our emphasis will focus on value chain financing in 10 priority commodities. These products have been responsible for a significant share of our country’s food import bill in the last couple of years,” he said.

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