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The Managing Director/Chief Executive Officer of Lagos Commodities and Futures Exchange (LCFE) has identified money spending on produce inspectors as a major driver of food inflation in the country.
Mr Akin Akeredolu-Ale, the LCFE boss, disclosed this during a chat with journalists on Wednesday at the exchange’s office in Lagos.
Akeredolu-Ale said, “On food inflation, there was a retreat that was organised by the SEC for the Senate Committee on the capital market, recently, and one of the senators that came said that when a truck is coming from Yola to Lagos, because of the various stops on the road, you will discover that they spend about N1.5 million on produce inspectors here and there.
“When people are bringing paddy rice to us at Imota when they are entering Oyo from Ilorin, they pay produce inspectors; when they are entering Ibadan and they get to Ogere, Lagos/Ibadan Expressway, to enter Ogun State, they pay. As they leave Ogun State and head to Lagos, they pay the local government levy too.
“And when they enter Lagos, some of them would rather go through a particular route. By the time they get to their destination, they will have spent over N2 million.
They don’t mind spending the money because they are going to pass the cost of the commodity and when they do that, it will be passed on to the final consumer so effectively.
Nigerians are eating the skin on our heads.
“There are three things there: the people on the road, the bad roads and turnaround time. When you remove these three things, prices will drop. Some countries in Africa have told everyone that any truck moving commodities from one location to another, no matter the offence, must allow the truck to get to its destination because it is the truck you are arresting, not the commodities,” he stated.
Akeredolu-Ale also commended the efforts of the Federal Government in addressing the issue of food security but explained that the government could achieve better if commodities exchanges were involved in the process.
On the exchange’s outlook for 2024, the LCFE boss said :
“For 2024, our focus at the beginning of the year was to ensure there is stabilisation in the rice paddy space. For the rice paddy space, we have approval from the Securities and Exchange Commission to trade spots for rice paddy.
“The biggest problem for rice mills in Nigeria is the paddy itself.
We have a mill that will consume about 150,000 metric tonnes of paddy. What we have decided to do is activate the states with arable land for integration so that structured finance can go in to activate farmers.”
