Osinbajo Asks Dairy Investors To Support Local Production

Osinbajo Asks Dairy Investors To Support Local Production

 

Vice President Yemi Osinbajo has called on investors in the dairy industry to facilitate backward integration in the sector, including providing incentives for local dairy farmers.

Professor Osinbajo made the call on Friday when he received a delegation from FrieslandCampina led by its Global CEO, Mr Hein Schumacher, at the Presidential Villa in Abuja.

“I think that Friesland needs to, on its own, do something because there is really no incentive for backward integration,” he was quoted as saying in a statement by his media assistant, Mr Laolu Akande.

“I think that there is a need for you to do more in terms of local production and set some timelines. Maybe after six years, you should be doing 70 per cent and not 10 per cent. My view is that if we go at the current rate, it will be extremely difficult for the local producers to move up.”

The vice president stressed the need to develop a robust plan for extending the dairy development programme across the country.

Although he said backward integration was very crucial, he decried the lack of incentives for the initiative.

To address the issue, Professor Osinbajo proposed a programme aimed at putting the dairy farmers in a position where they can produce more.

“There should be a very robust plan to encourage cattle breeders to actually increase yields so that we can say, after a particular period, 70 per cent of products should be locally produced but the problem, I must say, is still the lack of incentives,” he said.

Osinbajo assured the delegation of the Federal Government’s readiness to support the country to actualise its set business objectives.

He also called for a better synergy between the public and private sector.

Mr Schumacher informed the vice president earlier that the company had developed a plan to grow local dairy industry through a small-holder farmer dairy programme in the country.

He urged the Federal Government to support the company’s development plan by improving infrastructure in its operational base in Oyo State and also providing tax incentives for its new investments.

The delegation also included the Netherlands Ambassador to Nigeria, Mr Robert Petri, and the Chairman of the FrieslandCampina WAMCO Nigeria, Mr Jacob Ajekigbe, as well as other management staff of the company.

World food prices fall in May: UN’s FAO

World food prices dropped in May for a second month in a row, hit by steep falls in dairy products, sugar and other commodities, and are likely to fall further in the coming months, the United Nations’ Food and Agriculture Organisation (FAO) said on Thursday.

Food prices grabbed attention of the world leaders after their spike to record highs in February 2011 helped fuel the protests known as the Arab Spring in the Middle East and North Africa. Food prices have fallen since.

Improvement in the security of food supplies amid the economic downturn was high on the agenda of a summit of leaders of the G8 industrial powers last month.

The FAO Food Price Index, which measures monthly price changes for a food basket of cereals, oilseeds, dairy, meat and sugar, averaged 204 points in May, down from 213 points in April, the FAO said in its monthly index update.

“We were expecting a decline in May, the surprise is the extent of it, which showed that markets for oils and fats, dairy products and sugar all had to make sharp downward adjustments,” Abdolreza Abbassian, FAO’s senior economist and grain analyst, told Reuters.

In May, an improved outlook for crops in some major producing countries, a strengthening U.S. dollar, which hits competitiveness of dollar-denominated commodities, and growing concerns about Europe’s debt crisis pushed prices down.

“We’re in a situation where supplies have improved and we’ve had quite a big spillover from other markets which were all down,” Abbassian said.

The steep price drop in May meant that even if further declines were seen in June, they would probably be less marked, he added.

The index was driven down by a 12 percent fall in dairy prices, a 9 percent drop in sugar and a 7 percent decline in oils and fats.

REUTERS