By Simpson Global Media News Desk
The Emir of Kano, Muhammadu Sanusi II, has warned that Nigeria’s use of imported food to ease rising prices could weaken domestic agricultural production, damage investments in rice processing and leave financial institutions exposed to bad loans from struggling agribusinesses.
Sanusi made the remarks at the Sustainable Table Series in Lagos on Thursday, October 15, arguing that although opening the market to food imports helped reduce food prices following the removal of the petrol subsidy, the policy carried consequences for local producers and investors. He cited rice imports from Thailand as an example of the competitive pressure facing Nigeria’s domestic rice industry. <Cite refs={["turn609200view0","turn609200view1"]}/>
The emir’s intervention has brought renewed attention to a difficult policy question facing Nigeria: how can the government make food affordable for households struggling with living costs without undermining farmers, processors and businesses whose investments are necessary to expand local food production?
Sanusi argued that affordability measures should protect vulnerable consumers without exposing domestic agricultural enterprises to overwhelming competition. He also called for stronger rural infrastructure, including roads and bridges connecting farming communities to markets, as part of a broader strategy to strengthen agricultural productivity. <Cite refs={["turn609200view0","turn609200view1"]}/>
His remarks come as the Federal Government continues to promote agricultural mechanisation, irrigation, improved storage, domestic production and food processing. On October 16, the Ministry of Agriculture and Food Security said the sector recorded 4.39 per cent growth in the second quarter of 2026, while crop production grew by 3.66 per cent, citing figures from the National Bureau of Statistics. <Cite refs={["turn609200view2"]}/>
The figures indicate reported growth in the sector, but they do not by themselves establish that farmers are profitable, rice mills are operating at capacity or food is affordable to every household.
The tension between cheaper food and domestic production
Sanusi’s central argument is that policies designed to lower food prices in the short term can have unintended consequences if they expose local producers to competition they cannot withstand.
When food prices rise sharply, governments face pressure to increase supply and reduce the cost of essential staples. Importing food can add to available market supply, depending on volumes, timing, exchange rates, transport costs and the price of the imported product. If imported food reaches consumers at lower prices than domestic alternatives, it can provide relief to households.
However, domestic farmers and processors must continue paying for inputs, labour, energy, transportation, equipment and financing. Where these costs are high, imported products may compete strongly against locally produced food, particularly if the imported supply is large enough to influence market prices.
That creates a policy dilemma. Consumers need affordable food now, while agricultural producers need predictable market conditions to justify investment in the next planting season and in processing facilities that may take years to repay.
Sanusi argued that the government should help poor households access food without relying on a broad influx of imports that could weaken domestic production. <Cite refs={["turn609200view0"]}/>
The distinction is important because food affordability and agricultural development are related but not identical objectives. A policy may ease prices for consumers in the immediate term without necessarily strengthening the country’s capacity to produce food sustainably.
Conversely, protecting local production without addressing high costs or inadequate supply could leave consumers paying more than they can afford. A sustainable policy must therefore balance household purchasing power with the ability of farmers and processors to produce competitively.
Sanusi’s comments highlight the need for interventions that address both sides of the problem, rather than treating lower market prices as the only measure of success.
Rice mills and the cost of agricultural investment
Rice processing is a major link between farmers and consumers. Mills convert harvested paddy rice into products that can be packaged, distributed and sold to households, retailers and institutional buyers.
A viable milling industry can create demand for locally grown paddy, generate employment, support transport and packaging businesses, and connect farmers with more organised markets. It can also create opportunities for investment in storage, grading, drying and other services that improve the value of agricultural produce.
But mills require capital and reliable access to raw materials. Investors must cover machinery, buildings, power, labour, maintenance, financing and distribution. The business depends on the ability to buy paddy at a price that makes sense for farmers while selling processed rice at a price consumers and commercial buyers will accept.
If imported rice competes at prices that local processors cannot match, mills may struggle to sell their output or operate consistently. If revenue falls below the cost of production and debt repayment, companies can find it difficult to service loans.
This is the concern Sanusi raised when he said that rice mills built by investors had been wiped out and that loans extended to businesses across the agricultural value chain had become bad debts. <Cite refs={["turn609200view0","turn609200view1"]}/>
His statement reflects the risks he believes were created by the import policy. The reports reviewed, however, do not independently establish the number of mills that closed, the scale of any losses or how much bad debt can be attributed specifically to imported rice. Those claims should therefore be understood as Sanusi’s assessment rather than a verified nationwide tally.
Even with that qualification, the underlying concern is significant. When agricultural processing businesses fail, the effects can extend beyond their owners. Farmers may lose buyers, workers may lose jobs, lenders may struggle to recover loans and communities may lose businesses that provide services and market access.
The impact can be particularly serious where investors have borrowed to establish processing facilities on the expectation that domestic production will expand and provide a steady supply of raw materials.
For policymakers, the challenge is to ensure that measures aimed at making food affordable do not unintentionally destroy productive capacity that the country may later need to rebuild at greater expense.
Why domestic rice processing matters
A stronger domestic rice value chain can deliver benefits beyond the production of a staple food.
When paddy is grown, purchased and processed locally, economic activity can spread across several stages: seed supply, land preparation, cultivation, harvesting, aggregation, drying, milling, packaging, transport and retail distribution.
Each stage creates opportunities for businesses and workers. Processing can also improve the consistency of the product reaching consumers and create routes into institutional and commercial markets.
A stable milling industry gives farmers a reason to invest in improved production when they have confidence that their harvest can be sold. Where reliable buyers are absent, farmers may face difficulty obtaining fair prices or may be discouraged from expanding cultivation.
At the same time, mills cannot remain viable simply because they are located in Nigeria. They need consistent access to quality paddy, dependable power, efficient machinery, working capital and distribution networks. The cost of local production must also be competitive enough for businesses to reach consumers.
Import competition can expose weaknesses in these areas. It can also place pressure on producers to improve efficiency, depending on market conditions and the extent of the competition.
The policy question is therefore not simply whether imports should be allowed or prohibited. It is whether domestic producers can compete under the prevailing conditions, whether imports are being used as a temporary response to shortages or a longer-term substitute for local capacity, and whether government interventions address the underlying reasons domestic food remains expensive.
Sanusi’s warning calls for a closer examination of those issues and the consequences of policy decisions for investors throughout the food chain. <Cite refs={["turn609200view0"]}/>
Food affordability remains an urgent concern
The case for affordable food cannot be separated from the circumstances of households facing high living costs.
Food is a basic necessity, and when prices rise faster than incomes, families may have to reduce the quantity or quality of food they consume. Low-income households are especially vulnerable because a large share of their available income may already be committed to food and other essential expenses.
For such households, a lower price for a staple can make a meaningful difference to daily budgets. Governments therefore have a legitimate reason to seek ways of improving availability and affordability.
The difficulty arises when a measure that reduces prices today weakens the ability of domestic producers to supply the market tomorrow.
If local farmers reduce production, processors close or lenders withdraw from agricultural financing after suffering losses, the country may become more dependent on external supply. That can leave food availability and prices more exposed to international market conditions, shipping costs, foreign exchange pressures and changes in exporting countries’ policies.
This does not mean imports are always harmful or that all food imports should be rejected. Imports can be useful when domestic production falls short, during supply disruptions or when specific products cannot be supplied competitively at home.
Rather, Sanusi’s argument is that the government should consider the long-term effects of its decisions and design consumer support that does not place unnecessary pressure on domestic production. <Cite refs={["turn609200view0","turn609200view1"]}/>
Possible approaches include targeted assistance for vulnerable households, improving distribution and storage, reducing production costs, expanding domestic output and making agricultural finance more accessible. The effectiveness of any intervention would depend on how it is designed, funded and implemented.
The ultimate objective should be a food system in which consumers can afford essential products and farmers and processors can earn enough to remain productive.
Rural roads and electricity are part of the food-price equation
Sanusi also stressed that infrastructure is central to agricultural development, arguing that public investment should connect rural communities to markets and essential services rather than concentrating excessively on visible urban projects. <Cite refs={["turn609200view0"]}/>
The argument reflects a longstanding challenge for Nigerian agriculture: the cost of getting produce from farms to consumers can be influenced as much by transport, storage and power as by the cost of growing crops.
A farmer may harvest a good crop but still earn little if roads are poor, transport is expensive or buyers cannot reach the farm easily. Produce can be delayed, damaged or lost while waiting to be moved. Traders may have to charge more to cover the cost and risk of transporting it.
For rice producers, the supply chain includes moving paddy from farms to aggregation centres and mills, processing it, and transporting the finished product to wholesalers and retailers. Each stage can add costs. Where roads are inadequate or transport links are unreliable, the final price can rise even when farm production is strong.
Electricity is another important factor. Processing facilities need dependable power to run equipment and maintain operations. Where grid supply is unreliable, businesses may rely on alternative power sources, adding to their operating costs.
The same principle applies to irrigation, cold storage and other parts of the agricultural economy. Investments that improve infrastructure can help farmers and processors reduce costs, limit losses and supply markets more reliably.
Sanusi’s call for rural infrastructure therefore connects directly to the debate over food imports. If domestic production is expensive partly because of weaknesses in roads, power and logistics, import competition alone will not resolve those structural problems.
A long-term response would require targeted investment in infrastructure that improves agricultural productivity and helps local businesses compete on cost and reliability.
Government points to growth and new agricultural interventions
The Federal Government has presented a range of programmes as part of its effort to improve food production and reduce costs.
In a statement marking World Food Day on October 16, the Ministry of Agriculture and Food Security reported that agriculture grew by 4.39 per cent in the second quarter of 2026, while crop production expanded by 3.66 per cent. The ministry attributed the figures to National Bureau of Statistics data. <Cite refs={["turn609200view2"]}/>
The ministry also reported that annual domestic wheat production had risen to approximately 420,000 metric tonnes from a previous baseline of 120,000 tonnes, and said that smallholder farmers supported under the National Agricultural Growth Scheme and Agro-Pocket had produced 2.5 million metric tonnes of staple foods over four farming seasons. These are government-reported figures and should be assessed alongside further production, market and household data. <Cite refs={["turn609200view2"]}/>
The ministry cited the commissioning of 2,000 tractors and associated implements under the Renewed Hope Agricultural Mechanization Programme, as well as soil mapping, promotion of biofortified crops and efforts to strengthen agricultural extension services. It also said the government was expanding dry-season farming, investing in processing zones and storage facilities, and promoting irrigation and agricultural insurance. <Cite refs={["turn609200view2","turn493299search0"]}/>
These interventions address several of the structural problems that can make domestic agriculture expensive or unpredictable. Mechanisation can help farmers prepare land and carry out field operations more efficiently when equipment is available at affordable rates. Improved extension services can support farmers with information about production practices, while irrigation can reduce dependence on rainfall in suitable locations.
Storage and processing investment can help reduce losses after harvest and improve the timing of sales. Better access to finance can allow farmers and businesses to invest in inputs, equipment and operations without relying exclusively on costly short-term borrowing.
However, announcing or commissioning equipment is only one part of implementation. The real test is whether machinery reaches farmers when needed, whether it is maintained, whether services are affordable and whether production gains translate into reliable supplies and improved incomes.
Likewise, sector-wide growth does not necessarily mean every crop, region or business is performing well. The rice industry may face specific market pressures even when the broader agricultural sector expands.
The government’s reported growth figures and Sanusi’s concerns about rice mills can therefore coexist. One describes overall sector performance; the other raises questions about the distribution of benefits and the viability of a particular part of the food value chain.
The role of agricultural finance
Sanusi’s reference to bad loans highlights the relationship between agricultural policy and the financial institutions that fund production and processing.
Agriculture is exposed to risks that can make lending difficult. Harvests depend on weather and other conditions; prices can change between planting and sale; and farmers may have limited collateral or incomplete financial records. Processing businesses face their own risks, including fluctuating raw-material prices, operating costs and changes in demand.
Lenders must assess whether borrowers will generate enough income to repay loans. If a policy change or market shock reduces a business’s sales, repayment can become difficult even where the borrower originally expected the investment to be viable.
For rice mills, financing may be required to purchase machinery, build facilities, buy paddy, pay workers and maintain inventory while products move through the market. If a mill cannot sell enough rice at a sustainable margin, its ability to service debt can deteriorate.
A wave of loan defaults can affect more than the businesses directly involved. Banks and other lenders may become more cautious about financing similar enterprises, making it harder for new farmers and processors to obtain capital.
This creates a potential cycle: inadequate finance limits investment, low investment constrains productivity, high production costs weaken competitiveness, and weak returns make lenders more reluctant to provide additional funding.
Sanusi’s warning suggests that policy decisions need to account for the financial commitments made by agricultural businesses. <Cite refs={["turn609200view0","turn609200view1"]}/>
A stable policy environment can help businesses plan, but stability alone is insufficient. Agricultural lending also depends on risk-sharing arrangements, appropriate loan terms, insurance, reliable markets and credible mechanisms for evaluating projects.
Government-backed credit schemes can help where they are well designed, but they must be implemented transparently and assessed for their actual effects on production, business survival and repayment. Poorly targeted lending can create additional financial problems rather than solve existing ones.
The broader lesson is that food policy, trade policy and agricultural finance should not be treated as unrelated areas. Decisions affecting the price and availability of food can influence the income streams on which farmers, processors and lenders depend.
Could targeted assistance offer a better balance?
Sanusi argued that the government could make food cheaper for poor households without opening the market to a flood of imports. <Cite refs={["turn609200view0"]}/>
One option policymakers may consider is targeted consumer support. Rather than relying solely on broad measures that affect the entire market, assistance could be directed towards households least able to afford food.
Such programmes can take different forms, including targeted cash assistance or other carefully designed support. Their effectiveness depends on accurate beneficiary identification, adequate funding, transparent delivery and safeguards against diversion or exclusion.
Targeted assistance is not a simple solution. It requires reliable data, administrative capacity and a clear understanding of household needs. If poorly implemented, eligible families may be missed or assistance may fail to keep pace with changes in prices.
Nevertheless, the principle is worth considering: helping vulnerable consumers directly may allow the government to address immediate hardship while maintaining a stronger focus on improving domestic production.
On the supply side, support could prioritise measures that lower the cost of growing and processing food. These might include improved seed access, efficient fertiliser distribution, mechanisation services, irrigation, storage, power supply, rural roads and affordable financing.
The design of such support matters. Assistance should reach active producers and viable enterprises, and its results should be monitored. It should not simply preserve inefficient businesses indefinitely or shift costs onto consumers without delivering improved supply.
A balanced approach would seek to improve domestic competitiveness while ensuring that families facing hardship can still obtain nutritious food.
Food security requires more than rice production
The debate also points to a wider issue: food security is not only about producing enough of one staple.
A resilient food system must provide a variety of affordable and nutritious foods, ensure that they can reach consumers, and support livelihoods across farming, processing and distribution. Rice is important, but households also need other grains, roots and tubers, vegetables, protein sources and essential nutrients.
In his remarks at the Sustainable Table Series, Sanusi also raised concerns about malnutrition in Kano State, saying that more than half of children under five were malnourished and approximately 40 per cent of women of childbearing age were anaemic. These figures were presented by the emir and were not independently verified in the reports reviewed for this article. <Cite refs={["turn609200view0","turn609200view1"]}/>
His comments linked food access to the broader development challenge of improving nutrition, health and human capital. The issue is not simply whether food is present in a market, but whether households can afford enough nutritious food and whether children and pregnant women receive adequate nutrition at critical stages of life.
Agricultural policy can contribute to these goals by improving availability, reducing losses and supporting production of a diverse range of foods. Nutrition policy and social support also play important roles.
For policymakers, this means the success of food interventions should be measured not only by prices or total output, but also by whether households can obtain suitable food and whether the system provides sustainable livelihoods for those who produce it.
What policymakers and investors need to watch
The debate raised by Sanusi points to several practical questions that should guide future decisions.
First, policymakers need better visibility into the condition of domestic processing capacity. Information on mill operations, closures, utilisation, investment, employment and loan performance would help establish the scale of the problems he described.
Second, the effects of import policies should be assessed against both consumer and producer outcomes. A reduction in prices may benefit households, but the analysis should also consider how those policies affect local production, investment and future supply.
Third, domestic competitiveness requires attention to the full cost of production. Improving access to machinery or seeds will have limited effect if transport, power, finance and storage remain prohibitively expensive.
Fourth, agricultural finance should be aligned with the realities of farming and processing. Credit must be accessible on workable terms, while lenders need mechanisms to manage risk and borrowers need markets capable of generating sustainable returns.
Finally, support for vulnerable consumers should be designed with accountability and measurable outcomes. Government should be able to demonstrate whether assistance reaches the intended households and whether it improves access to food.
These steps would help turn the debate from a choice between imports and domestic production into a more practical discussion about how to build a food system that is affordable, productive and resilient.
A policy challenge with long-term consequences
Sanusi’s warning has renewed attention on the potential consequences of relying on food imports to manage price pressures. His remarks suggest that short-term relief can come at a cost if domestic processing and production are weakened in the process.
His claim that rice mills were wiped out and agricultural loans became bad debts requires further independent evidence before it can be treated as a comprehensive account of the sector. But the underlying policy question remains important: how can Nigeria meet immediate food needs without discouraging the investments required to supply the market in the future?
The government’s reported agricultural growth and current interventions offer one part of the picture. The experience of farmers, millers, traders and consumers will determine whether those initiatives translate into stronger production, more competitive processing and improved affordability.
Nigeria does not have to choose between caring for poor households and developing domestic agriculture. A better approach would combine immediate support for vulnerable consumers with sustained investment in production, processing, rural infrastructure and agricultural finance.
For rice farmers and millers, the key issue is whether they can operate in a market where local production has a viable future. For consumers, it is whether staple foods remain affordable. For policymakers, it is whether the decisions made today build a food system capable of serving both groups over the long term.
The challenge is to ensure that food affordability measures provide relief without sacrificing the productive capacity needed for lasting food security.
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