Agricultural Policy and Its Impact on Smallholders in Nigeria

Agricultural policies play a critical role in shaping the landscape of farming in Nigeria, especially for smallholder farmers who make up the majority of the agricultural workforce. With over 70% of Nigeria's food produced by smallholder farmers, their success is essential to the country's food security and economic development. However, current agricultural policies often fail to provide adequate support to these farmers, limiting their productivity and ability to grow. This article analyzes the impact of existing policies on smallholders and proposes key reforms to create a more supportive environment for their growth.

The Current State of Agricultural Policies in Nigeria

Nigeria’s agricultural policies over the years have aimed to diversify the economy away from oil dependency by revitalizing the agricultural sector. Key initiatives, such as the Agricultural Transformation Agenda (ATA) launched in 2011, were introduced to drive this shift. However, despite these efforts, many policies have yet to effectively reach or benefit smallholder farmers.

1. Access to Credit:

One of the most significant barriers for smallholders is access to credit. While the Central Bank of Nigeria (CBN) has introduced financing schemes like the Anchor Borrowers' Program and the NIRSAL Microfinance Bank, many smallholders still struggle to secure loans due to high collateral demands, bureaucratic procedures, and the lack of financial literacy.

2. Land Tenure and Ownership:

Nigeria’s Land Use Act of 1978 has had lasting effects on smallholder farmers' ability to own land. Most smallholders operate on communal or rented land, which limits their ability to make long-term investments in modern farming practices. Without formal land ownership, farmers face challenges in accessing loans and grants that require collateral.

3. Infrastructure and Market Access:

Nigeria’s inadequate rural infrastructure—poor roads, lack of storage facilities, and unreliable transportation—hampers smallholder farmers’ ability to access markets. In regions where infrastructure is underdeveloped, farmers face high post-harvest losses due to spoilage before their products reach the market.

4. Government Subsidies and Support:

Although input subsidies for fertilizers, seeds, and equipment have been part of Nigeria’s agricultural policies, they are often poorly targeted. Larger, more established farms receive the bulk of government support, leaving smallholders with limited access to affordable inputs. The inefficiency in distribution systems and corruption further exacerbates the problem.

The Impact of Current Policies on Smallholders

The existing agricultural policies have not adequately addressed the unique challenges faced by smallholder farmers. As a result, many smallholders remain trapped in subsistence farming, unable to scale up their operations or adopt modern farming techniques. Here are some of the main areas where current policies fall short:

1. Low Productivity:

Limited access to high-quality inputs and technology means smallholders often have lower yields compared to commercial farms. The lack of extension services to provide training on modern farming techniques also restricts their productivity.

2. Market Vulnerability:

Smallholders often depend on local markets for selling their produce, leaving them vulnerable to price fluctuations and middlemen who take a large share of their profits. Without access to national or international markets, they struggle to expand their income.

3. Climate Change and Environmental Challenges:

Climate change poses a significant threat to agriculture in Nigeria. Smallholders, in particular, are more vulnerable to extreme weather events due to their lack of resources to invest in climate-resilient farming practices or insurance schemes.

Suggested Reforms to Support Smallholder Farmers

1. Improved Access to Finance:

Reforms should focus on creating more inclusive financial schemes tailored to smallholder farmers' realities. Microfinance models, government-backed credit guarantees, and lowering collateral requirements could enhance their access to capital. Additionally, promoting financial literacy programs would empower farmers to better manage their finances and navigate loan processes.

2. Revising the Land Use Act:

Land tenure reform is crucial to give smallholders greater security and enable them to make long-term investments. Simplifying the process of acquiring land ownership, especially for women and youth, will encourage more sustainable agricultural practices and increase farm productivity.

3. Building Infrastructure:

Government investment in rural infrastructure should prioritize improving roads, transportation, and storage facilities to reduce post-harvest losses and enhance market access. Cold storage chains and agro-processing zones near farming communities can extend the shelf-life of perishable goods, creating a more robust supply chain.

4. Extension Services and Training:

Strengthening extension services to deliver practical, hands-on training in modern farming techniques, climate-smart agriculture, and technology use can help smallholders improve productivity. Public-private partnerships can facilitate the spread of innovative farming methods.

5. Promoting Cooperative Farming:

Encouraging smallholder farmers to form cooperatives can increase their bargaining power, reduce costs by pooling resources, and improve market access. Cooperatives can also serve as platforms for farmers to receive bulk discounts on inputs, access financing, and share knowledge.

6. Export and Value Addition:

Policies should focus on assisting smallholders to produce for export markets. This includes providing training in international standards, improving packaging, and promoting value-added processing to help farmers capture more value from their produce.

7. Climate-Resilient Policies:

Introducing climate-resilient farming practices through government-supported initiatives can help smallholders mitigate the risks posed by climate change. Policies should promote drought-resistant seeds, efficient irrigation systems, and agricultural insurance to protect farmers from climate-related losses.

Conclusion

Agricultural policy in Nigeria must evolve to truly empower smallholder farmers and unlock the sector’s full potential. By reforming financial access, land tenure laws, infrastructure development, and extension services, the government can foster a more inclusive environment for smallholders to thrive. A focus on sustainability and export market readiness will ensure that smallholder farmers contribute meaningfully to Nigeria’s food security and economic growth.

Call to Action

It's time for Nigeria to reform its agricultural policies and support smallholders. Small changes in financial access, land ownership, and training can lead to massive improvements in productivity and livelihoods. Let’s pave the way for smallholders to thrive and make Nigeria’s agricultural sector more resilient.