Ground-breaking Impact of Anchor Borrowers’ Programme

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The Central Bank of Nigeria (CBN) in line with its developmental function established the Anchor Borrowers’ Program (ABP). The Program which was launched by President Muhammadu Buhari (GCFR) on November 17, 2015 is intended to create a linkage between anchor companies involved in the processing and small holder farmers (SHFs) of the required key agricultural commodities. The program thrust of the ABP is provision of farm inputs in kind and cash (for farm labor) to small holder farmers to boost production of these commodities, stabilize inputs supply to agro-processors and address the country’s negative balance of payments on food. At harvest, the SHF supplies his/her produce to the Agro-processor (Anchor) who pays the cash equivalent to the farmer’s account.

Looking back since its commencement, the programme has produced a lot of success stories and its sustainability has proven the government’s commitment to agriculture.

The CBN Governor, Mr. Godwin Emefiele, said that since the inauguration of ABP in 2015, over 32 states and the Federal Capital Territory (FCT) had embraced the programme, while over N55 billion had been disbursed to over 250,000 farmers under the scheme.

He said that the ABP was being implemented under the aegis of the Presidential Task Force on Rice, and Wheat Production, in conjunction with the Federal Ministry of Agriculture and Rural Development (FMARD).

He said that the programme had created economic linkages between smallholder farmers and reputable large-scale crop processors, with a view to increasing agricultural output and capacity utilisation of integrated mills.

Emefiele noted that ABP had closed the gaps between local rice production and domestic consumption, while complementing the Growth Enhancement Support (GES) Scheme of FMARD by facilitating the transformation of GES-farmers from subsistence farming to commercial farming.

Job Creation

While he was also speaking at the annual bankers’ dinner in December last year, the CBN Governor stated that the programme has created 2.5 million jobs across the country.

According to Emefiele, “As at October 2018, a total number of 862,069 farmers cultivating about 835,239 hectares, across 16 different commodities, have so far benefited from the Anchor Borrowers programme, which has generated over 2.5 million jobs across the country.

He said: “It is in light of the success of the Anchor Borrowers Program with regards to cultivation of rice and maize that the Monetary Policy Committee in its last meeting on the 21st of November 2018 recommended that the Anchor Borrowers program be applied to other areas such as palm oil, tomatoes, and fisheries to mention a few.

“The CBN recently introduced the Real Sector Support fund; a facility meant to provide cheap funding at no more than nine percent to new projects in the Agriculture and manufacturing sectors; aimed at boosting output and creating jobs.’’

A New Phase for Corn Farmers

According to the Bank of Agriculture boss, the Nigerian corn farmers have begun N3bn CBN loan repayment.

As Nigeria sought to import 300,000 tons of maize last month to meet its consumption demand of 11.3 million tons, the country’s maize farmers have begun the repayment process that sees the central bank of Nigeria recouping as much as N3 billion in loan from the farmers.

The CBN, through the Anchor Borrowers Scheme in the last farming season, disbursed about N3 billion to the Maize Association of Nigeria (MAAN) via the Bank of Agriculture.

Bank of Agriculture chief, Kabiru Umar, said the farmers’ body promised an initial payment of N1.2 billion this week, without giving details on when the remaining balance of N1.8 billion would be paid.

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“We are expecting as initial repayment is N1.2 billion, like the President of MAAN has said which he promised me, by this week, they will make that repayment to the bank. MAAN got about N3 billion during the first season.

“The agreement we have with them is that repayment will be 30 per cent initial repayment, then 40 percent during the second season and then 30 percent during the last season, so with the N1.2 billion they have made promised to repay, we will closely monitor them, we will still support them for the next season,” Umar said.

Dubbed ‘A Revolution’ for Farmers

The Minister of Information and Culture, Alhaji Lai Mohammed, believes that the Federal Government’s Anchor Borrowers’ Programme has led to a revolution in rice production across the country.

On his visit to farms across states last year, he said the benefits that have accrued to rice farmers in the provision of improved seedling, farm input and extension services have led to the increase of yield per hectare from 2.5 to between 10 and 11 metric tonnes.

“The difference between then and now is the Anchor Borrowers’Programme because with the Anchor Borrowers’ Programme, the average farmer today is assisted in terms of input, agronomic practices and seedling.

“So this system has now taken the burden off the farmer and given him what he normally would have gone out to buy or procure. But the important thing is that from 2.5 metric tonnes to 10 to 11 metric tonnes within the same space, I think is a new revolution,” Alhaji Mohammed said.

He said with 32 states currently covered by the Anchor Borrowers’ Programme, the Federal Government is determined to turn Nigeria into a net exporter of rice in the not distant future.

“Two years ago, Nigeria used to import 644,000 metric tonnes of rice from Thailand. Today, we import less than 20,000 metric tonnes…..But I think the most important thing for us in Nigeria is to see that officially we have been able to eliminate over 90% of rice importation into Nigeria,” the Minister said.

He said that a new pilot scheme that targets the cultivation of 200,000 hectares of rice has taken off with 31,000 farmers being empowered by the Anchor Borrowers’ Programme.

He said that already, the Federal Government has grown the number of rice farmers from 5 million two years ago to over 12 million currently.

He also commended the synergy between the Federal and State Governments in rice farming, and disclosed that the Federal Government plans to embark on an aggressive advocacy for Nigerians to know the benefits of consuming locally-produced rice.

“The rice in Nigerian is safer, more nutritious and healthier than the one being imported. The one being imported has been stored for several years, perhaps in very bad condition and it is not safe to consume,” he said.

Mr Isaac Okoroafor, the Acting Director of Corporate Communications Department, CBN, said that in 2018, N36.37 billion was disbursed to 155,732 farmers, while N12.57 billion paid to 27 farmers in the first half of 2017; bringing the total disbursements, since the inception of the programme, to N91.90 billion.

“More than 412,037 smallholder farmers are beneficiaries in 36 states and the FCT; there are 13 state government anchors and 127 private-led anchors,’’ he said.

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The acting director said that the total ABP loans repayment, since inception to date, was N12.19 billion, adding that the programme had created over 500,000 jobs, while adding two million tonnes of rice to the domestic rice supply.

Okoroafor noted that the volume of rice importation into the country had drastically declined in 2018, judging by figures obtained from various official sources.

“Figures obtained from India and Thailand, which are dominant rice exporters to Nigeria indicate that as at September 2018, Thailand exported about 5,161 tonnes of rice to Nigeria, while India exported only a paltry 426 tonnes to Nigeria as at July 2018.

“CBN had not allocated any foreign exchange for the importation of rice and we, therefore, attribute the achievement to the concerted efforts of FMARD and Rice Farmers Association of Nigeria (RIFAN),’’ he said.

Besides, the CBN has made available some concessionary funds to the Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL) for disbursement as loans to rice, wheat, maize, cotton, cassava, poultry, soybeans and groundnut farmers.

The Managing Director of NIRSAL, Mr Aliyu Abdulhameed, said that the outcome of the venture had been very positive, as NIRSAL, through the ABP, had been able to create over 250,000 direct jobs and 1.25 million indirect jobs across the country.

In addition, Abdulhameed said that NIRSAL had so far facilitated the provision of highly affordable loans, with single-digit interest rates, totalling N5.7 billion, to over 33,000 farmers for wet and dry season farming in 2017 and early 2018.

Alhaji Aminu Goronyo, the National President of RIFAN, said that more than two million rice farmers, who registered for ABP, were supported with funds and farm inputs such as water-pumping machines, with a view to facilitating their participation in dry season farming.

He said that the terms of ABP loans were also flexible, adding that beneficiary rice farmers could either pay back the loans with cash or harvested paddy rice at the end of the farming season.

Goroyo said that through ABP initiative, the agricultural sector had been strategically re-positioned to have multiplier and linkage effects on the nation’s economy, security and industrial development.

He noted that massive produce importation had been the rationale behind the unattractiveness of Nigeria’s agriculture and agribusiness to potential investors.

Besides, Goroyo said that RIFAN and the Nigeria Customs Service once signed a Memorandum of Understanding (MoU) to curb rice smuggling into the country through the land borders.

He stressed that the joint efforts had appreciably reduced the activities of rice smugglers, saying that the quantity of smuggled rice in the country, which largely came in through the informal sector, was just about five per cent of the rice which the citizens consumed.

He recalled that in 2015, Nigerians spent not less than N1 billion daily on rice consumption, adding that while the spending had drastically reduced, rice consumption had, nonetheless, increased because of improved local production.

Goronyo said that available statistics showed that the rice consumption rate had increased considerably, while the production rate had also increased exponentially.

He said that from 2016 to date, there were over five million ABP beneficiaries, adding that the beneficiaries included those involved in rice production, processing and marketing as well as inputs supply.

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He assured Nigerians that with the sustained implementation of ABP, his association would assiduously work towards Nigeria’s attainment of self-sufficiency in rice production by 2020.

Dr Tunde Arosanyin, the National Coordinator for Zero Hunger Commodity Farmers Association of Nigeria, said that the ABP was very much beneficial to farmers, adding that the programme was a veritable channel for facilitating the agricultural development of the country.

He said that although ABP had been having direct impact on rural farmers generally, there were still some missing links which ought to be addressed.

Arosanyin noted that the success of any agricultural programme could also be measured through the quality, accessibility and usage of farm inputs, adding that ABP had, however, scored below average in this regard.

In Kano State, Alhaji Abubakar Aliyu, the State Chairman of RIFAN, confirmed that over N6 billion had been disbursed as ABP loans to 25,000 rice farmers in the 2018 farming season.

Some of the beneficiary farmers commended the programme for early loan disbursements, which have enabled the farmers to engage in rice planting in good time.

“Each of us (the beneficiary farmers) was given fertilisers, seeds and chemicals as well as a certain amount of money to pay for labour,’’ said Malam Shehu Ibrahim, a rice farmer.

Alhaji Sadiq Daware, the National President of North East Commodity Association (NECAS), said: “The Buhari-administration has cut down on imports of agricultural products so as to enable Nigeria to attain self-sufficiency in food production and stimulate consumption through ABP.’’

He said that a N14.9-billion ABP loan was given to NECAS for a period of one year at a single-digit interest rate of 9 per cent.

He said that under the programme, over 27,000 farmers, particularly those affected by the Boko Haram insurgency in Taraba, Bauchi, Gombe, Adamawa and Yobe states, were the beneficiaries.

“Over 10,000 beneficiary farmers are from Gombe State and over 75,000 hectares of land would be cultivated in the five participating states.

“For example, 11,525 farmers are cultivating 38,678 hectares of land for rice, maize, sorghum, soya beans and cotton production; and in Yobe State, 5,676 farmers are cultivating 14,666 hectares of land,’’ he said.

Daware said that ABP would cover all the commodities in which the North East geopolitical zone had a comparative advantage, adding that such commodities included rice, maize, millet, sorghum and even livestock.

The Kwara State chapter of All Farmers Association (AFAN) says over 1,000 of its members, including rice, maize, soya beans and cassava farmers, have received ABP loans and inputs.

A beneficiary of ABP in Yobe State, Malam Idris Sulaiman, commended the CBN for introducing the programme, which was “a very good policy, aimed at stimulating an increase in rice production and ensuring Nigeria’s food security.’’

He said that ABP had particularly boosted the popularity of locally grown rice, while making it a choice food in many homes because of its higher nutritional value, when compared with the imported rice.

Sulaiman, however, urged the government to give concessions to importers of agricultural tractors, farm implements and machineries, as well as rice de-stoning machines and mills to boost rice production.

Madam Adenike Ogunjenrola, a maize farmer in Ekiti State, described the anchor borrowers’ initiative as one of the most successful agricultural programmes in the country.

She said that the programme had particularly raised the living standards of the farmers, while changing the narratives on agricultural investments in Nigeria and facilitating country’s food security.

Mr Pere Eteku, a rice farmer in Bayelsa State, said that he was happy to be part of the programme and pledged to utilise all the farm inputs, which were given to him under the programme, judiciously.

Malam Abdullahi Kando, a rice farmer in Kebbi State, described ABP as a catalyst for Nigeria’s agricultural transformation and food security, saying that tangible efforts should be made to sustain the programme even after the end of the Buhari-administration.

Sharing similar sentiments, Mrs Abiodun Bada, a farmer in Kogi State, said that ABP had significantly improved the welfare of farmers, while creating jobs for the youth.

“It is a cashless project which has provided its beneficiaries with farm inputs, such as improved seedlings, water pumps, chemicals and land preparation services,’’ Bada said.

All in all, the general consensus among beneficiaries and observers is that the Anchor Borrowers’ Programme is a groundbreaking agricultural scheme which should endure for a long time.        

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