Premier Feed Mills Nigeria suspends maize, sorghum purchases on high prices

NIGERIA – Premier Feed Mills Ltd., a subsidiary of Flour Mills of Nigeria has decided to temporarily suspend its purchases of maize and sorghum from local producers due to high prices.

Premier Feed Mills Ltd is a feed manufacturer in Nigeria and the largest producer of aquafeed in sub-Saharan Africa.

“As significant off-takers and processors of maize and sorghum, we can attest to maize and sorghum prices being artificially high at present, with ripple effects on prices of finished products like poultry and other livestock,” Premier Feed Mills said on its X platform.

To explain this decision, the company cites in particular the increase in cereal prices on the local market, in a context marked by food inflation which reached 35.41%, in January compared to 24.32% last year.

Data compiled by the National Bureau of Statistics (NBS) indicates that the average price of a kilogram of white maize increased by 79.5% year-on-year to N577.7 (US$0.36) in December 2023.

The company, however, noted that in the course of its active private-public sector collaborations, they have been in constant consultation with the government to establish viable ways of managing the ongoing food crisis, especially as it pertains to maize and sorghum.

Premier Feeds said it will continue to monitor the market environment and lift the suspension when prices stabilize.

The announcement comes after another agribusiness company, Olam Nigeria Ltd., announced earlier this month that it was taking similar measures over rising prices of coarse grains, which are critical raw materials in feed production.

In a statement, Olam said that it recognizes the nation’s significant challenges of food insecurity, and as a major buyer and processor of food staples, it shares the concerns around the high prices and supply chain disruptions affecting the availability of essential grains.

“As part of our proactive approach, Olam Agri in Nigeria has decided to temporarily suspend the procurement of essential grains such as maize and sorghum immediately which will allow us to closely monitor market trends and adjust to market realities.

“This decision follows wide consultations with relevant authorities and is part of our commitments to manage the ongoing crisis,” read the statement.

Olam Agri however noted that they are actively collaborating with industry peers and government authorities to identify and implement strategic solutions to alleviate any additional stress on food availability.

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