The drive for economic diversification in the country is likely to see more emphasis being put on the production of agricultural products, especially tubers like cocoyam.
According to the Financial Derivatives Company (FDC) Commodity Update for the period ended August 28, made available to our correspondent today (Wednesday), Nigeria is the world’s largest producer of cocoyam with an annual output of 3.2 million tonnes.
Even though agricultural sector growth slumped to 1.3 per cent in the second quarter of the year from 3 per cent in the previous quarter, addressing security and logistics challenges will spur the sector, which remains well below potential despite being targeted for improvement, asserted the report.
In its focus on cocoyam, the report asserts that it is likely to be one of the products that will benefit immensely from such policy moves.
According to the report, the current total global production of cocoyam is in the region of 10.6 million tonnes (worth $2.12 billion), while the world’s top producers include Nigeria, China and Cameroon with the world’s top consumers being Nigeria, Ghana and Cameroon.
Total annual output of cocoyam in Nigeria is 3.2 million tonnes (worth $640 million), which is 30 per cent of total global production. However, potential output of the product in the country is in the region of five million tonnes, stated the report.
The major producing states of the commodity in Nigeria include Ebonyi, Ondo and Cross River.
Concerning some other agricultural commodities, the report said wheat prices dipped by 0.84 per cent to $5.37/bushel due to the fact that it is on weak global demand. Equally, corn prices went down in the period under survey by 1.03 per cent to $3.78/bushel as investors monetized gains from last week’s rally.
Cocoa prices increased by 1.16 per cent to $2,364/MT partly due to expectations of weak Nigerian production, while sugar prices rose by 1.09 per cent to 0.1023/pound on bargain-hunting activities.
In its outlook on agricultural prices, the report stated that sugar will likely experience a combination of weak demand and excess supply to depress prices, while cocoa will experience higher production from Ivory Coast and Ghana, which is equally likely to weigh on the market.
The weather conditions in top producer-countries of the commodities will also influence prices, the report concluded.