Business, Economy

Fear grips agro exporters as Naira depreciates

Agro exporters may encounter face stiff competition from their counterparts from other emerging economies due to volatility of the Naira.

A sharp fall in the naira could erase its cost advantage over the currencies with lesser value.

Nigeria competes with countries, such as Ghana in major agro exports, which produces cashew, cocoa and sesame seeds. The naira is witnessing volatility at about N410 against the dollar. One Ghanaian Cedi is equal to N66.27.

With Cedi and other currencies depreciating more, the Chief Executive Officer, Multimix Group, Dr. Obiora Madu, told The Nation that the plunge in value of the naira is not translating into gains for exporters.

Madu noted that with the depreciation of the naira and the effect of coronavirus for sectors involving agro exports, the benefits would have been nullified.

According to him, agro exporters would face intense competition for new orders from rivals in these countries as they, too, enjoyed cost advantage due to their currencies.

He explained that exporters would have to buy produce at the farm gate as farmers will sell at prices considering the dollar position.

He said with the price of oil plummeting from $60 a barrel to $27 a barrel, Africa’s oil producers, particularly Nigeria, would face serious economic head winds. These include huge budget deficits.

He said the best way the government can address the situation is to create the enabling environment for agro exporters to push more produce to the global markets and earn more foreign exchange for the economy.

Please follow and like us:
Previous ArticleNext Article

Leave a Reply

Your email address will not be published. Required fields are marked *