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Inflation, Forex Scarcity Push Food Prices Up in August

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Inflation

Food Prices Rise in August Amid Surge in Inflation

Persistent increase in prices amid forex scarcity bolstered food prices in the month of August, according to the recent report from the National Bureau of Statistics (NBS).

In the report released on Tuesday, the bureau said the average price of 1kg of imported high-quality rice rose by 40.69 percent year-on-year in August.

On a monthly basis, this increased by 2.30 percent to N501.71 in August 2020, up from N490.44 in July 2020.

Nigeria’s consumer prices that measures prices of goods and services rose to 13.22 percent in August as forex scarcity amid economic uncertainties weighed on Africa’s largest economy.

The statistic office said the average price of 1kg of yam rose by 34.74 percent year-on-year and decreased on a monthly basis by -0.15 percent from N256.44 in July to N256.06 in August 2020.

Similarly, the price of 1kg of tomato expanded by 29.48 percent year-on-year while it decreased on a monthly basis by 4.65 percent from N301.01 posted in July 2020 to N289.86 in August 2020.

NBS stated that selected food price watch “reflected that the average price of one dozen of agric eggs medium size increased year-on-year by 3.70 per cent and month-on month by 1.02 per cent to N478.97 in August 2020 from N474.12 in July 2020 while the average price of piece of agric eggs medium size (price of one) increased year-on-year by 5.44 per cent and month-on month by 0.76 per cent to N42.78 in August 2020 from N42.45 in July 2020.

The report also noted that the recent flood caused by the sudden release of water from Kainji Hydro Power Dam in Niger State wreaked havoc on the N60 billion sugar investment project in the state.

According to Latif Busari, the Executive Secretary, National Sugar Development Council (NSDC), who spoke in Abuja, said the destruction was a huge setback for the flour mills industry and the entire nation as it would affect the 4,500 metric tons of sugarcane daily processing projected by the company and the one million tones of sugar production agreed with major sugar producers recently.

Busari, however, said the flood, which affected N60 billion investment, was not natural, but man-made from Kainji Dam.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.