The Bank of Agriculture (BOA) yesterday unveiled a N200 billion Guaranteed Minimum Price (GMP) Programme to protect farmers from depressed commodity prices and promote stability in the food market.
The programme, under the Renewed Hope Agenda, targets more than 500,000 farmers, 400,000 metric tonnes of grains and 11.25 million households.
The initiative, launched in Abuja on Tuesday, is designed to provide a price floor for participating farmers while establishing a structured pathway for aggregating, storing, and marketing agricultural commodities.
Speaking at the launch in Abuja on Tuesday, BOA Managing Director and Chief Executive Officer Ayo Sotinrin said the intervention was prompted by the losses suffered by farmers following the decline in the prices of major cereals and other commodities in 2024 and 2025.
He said farmers producing rice, maize, sorghum and soybeans were, in some cases, forced to sell below their production costs as market prices fell below import parity.
He noted that the GMP mechanism will ensure that farmers receive a minimum price for eligible produce when market prices fall below the guaranteed floor.
He stressed that the programme was not designed to fix commodity prices, as farmers would remain free to sell above the GMP whenever market conditions permit.
Sotinrin said the objective was to restore farmers’ confidence in production and discourage them from abandoning farming because of poor returns.
“No farmers, no nations,” he said, stressing the central role of farmers in the success of the country’s food system.
The BOA chief executive warned that the intervention was exclusively for genuine farmers who produced the commodities and were affected by depressed prices.
He said traders who bought grains from markets would not be eligible for the price guarantee.
“This guaranteed minimum price is only for farmers who have planted on their farms and who are suffering from these depressed prices. It is not for traders,” he said.
Sotinrin urged the All Farmers Association of Nigeria (AFAN) to help identify and mobilise genuine farmers to participate in the programme.
He said the bank would work with farmer aggregation companies, which would source and aggregate commodities directly from farmers, while payments would be made through the bank’s technology platform.
The aggregation companies, he added, would receive a fee per metric tonne handled.
The BOA MD said the intervention would go beyond buying grains from farmers and storing them.
He explained that the commodities would serve as a strategic reserve that could be released into the market when prices rise sharply.
According to him, the arrangement would enable the government to intervene on both sides of the market—protecting farmers when prices fall and supporting consumers, millers and food manufacturers when prices become excessively high.
He explained that when grain prices rise substantially, the BOA would release commodities from its reserves into the market at a lower price to moderate the increase.
Sotinrin said the mechanism would ensure farmers were not forced to sell at distress prices, while processors would not be compelled to buy at excessively high prices.
“We continue to use this mechanism to intervene in the market, to ensure that the buyer side and also the seller side, everyone is happy,” he said.
Sotinrin said the N200 billion intervention was being designed as a revolving market mechanism rather than a one-off government expenditure.
He said commodities bought from farmers would be stored and released when market conditions warranted, with proceeds from sales returning to the system to finance further interventions.
“We believe it will be a programme that will be successful even in 2035,” he said.
The BOA boss said the objective was not to make excessive profits from the commodities but to use the system to stabilise the market while recovering funds to sustain the programme.
The bank’s press kit states that 85 per cent of the programme funding is expected to be recouped through commercial sales and cautions that the N200 billion should not be described as a subsidy or grant.
The Managing Director of the Nigerian Commodity Exchange (NCX), Anthony Atuche, said the exchange would provide the market infrastructure required to support the programme.
He said NCX had warehouses across the six geopolitical zones, including community and farm-gate warehouses that would give farmers and cooperatives easier access to the programme.
Atuche said the warehouse receipt system would also make farmers’ commodities verifiable assets and potentially improve their access to finance.
He described the initiative as a market-driven programme designed to integrate production, aggregation, financing, warehousing, price discovery and market access.
He said NCX would also support the grading and standardisation of commodities to ensure that only produce meeting the required quality standards enters the system.
National President of AFAN, Muhammad Magaji, said Nigerian farmers had long advocated introducing a Guaranteed Minimum Price mechanism.
He said the absence of good prices for agricultural produce had made it difficult for farmers to remain sustainably in production.
Magaji assured the BOA of the association’s support, saying it had already begun sensitising farmers across states and local government areas on the programme.
He said farmers in parts of southern Nigeria had already begun harvesting and drying their grains and would be able to take advantage of the programme, while farmers in the North were expected to begin harvesting dry grains in the coming weeks.
The AFAN president said the association would work with the BOA to ensure that information about the programme reached farmers at the grassroots.
He also commended the Federal Government for its intervention in fertiliser supply, describing the provision of fertiliser at the right time, quantity and type as beneficial to farmers.
The GMP Programme is being implemented by the BOA under the National Commercial Food Reserve and the Renewed Hope Food Price Stabilization Programme, with the Federal Ministry of Agriculture and Food Security providing the policy framework.
The BOA said the programme’s targets of more than 500,000 farmers, 400,000 metric tonnes of commodities and 11.25 million households are projections and should not be reported as achievements already recorded.
The bank said the ultimate objective is to provide farmers with more predictable incomes, strengthen market participation, build strategic food reserves and contribute to greater food-price stability.
Provided by SyndiGate Media Inc. (Syndigate.info).
