BOA Launches ₦200bn Guaranteed Minimum Price Scheme to Protect Farmers From Price Crash

News in Brief:

— Nigeria's Bank of Agriculture has launched a ₦200 billion Guaranteed Minimum Price Programme to shield over 500,000 farmers from crashing grain prices, guaranteeing maize at ₦350,000 per tonne.

— Under the scheme, BOA will buy, store and later release grain reserves to stabilise market prices, working with the Nigerian Commodity Exchange and farmer aggregation companies to reach genuine cultivators only.

The Bank of Agriculture (BOA) has launched a ₦200 billion Guaranteed Minimum Price (GMP) Programme to protect Nigerian farmers from price crashes. The scheme will guarantee floor prices for staple grains and target more than 500,000 farmers nationwide.

Managing Director of BOA, Ayo Sotinrin, announced the programme on Tuesday at its launch in Abuja, saying it would aggregate at least 500,000 metric tonnes of grains from farmers across the country.

Sotinrin revealed that the intervention came after the hardship farmers faced in 2024 and 2025, when prices of major commodities, including maize, rice, sorghum and soybeans, fell below import parity. He said many farmers were left unable to recover their production costs during that period.

With this GMP mechanism, farmers who cultivated maize during the 2025 dry and wet seasons will be guaranteed a floor price of ₦350,000 per tonne whenever market prices fall below that level.

Scheme Targets Farmers, Not Traders

Sotinrin added that the programme is meant strictly for farmers cultivating these crops and not commodity traders.

"This guaranteed minimum price is only for farmers who have planted on their farms and who are suffering from these depressed prices. It is not for traders," he said.

He warned against middlemen who might buy grains cheaply from the open market and pass them off as farm produce to benefit from the scheme.

To reach genuine farmers, BOA said it would work with farmer aggregation companies to purchase eligible commodities directly, paying farmers electronically into their bank accounts. The aggregation companies, in turn, will earn a fee for every tonne of grain aggregated.

NCX to Provide Warehousing and Transparency

The programme will initially cover maize, sorghum and soybeans, with the Nigerian Commodity Exchange (NCX) providing the warehousing and market infrastructure needed to keep the process transparent.

Commodities bought under the scheme will be stored in certified warehouses and backed by warehouse receipts, issued only after checks on quality, quantity and specification.

Rather than let stored grain deteriorate, Sotinrin said BOA would treat the stockpile as a strategic reserve, to be released into the market whenever prices rise sharply.

He said if grain prices climb to around ₦500,000 per tonne, BOA could release its reserves at a lower price of between ₦380,000 and ₦390,000 per tonne to cool the market.

According to him, this dual approach protects farmers on one end while shielding millers, food manufacturers and everyday consumers from sudden price surges on the other.

A Revolving Fund, Not a One-Off Spend

Sotinrin clarified that the programme could evolve into a permanent market intervention tool, with funds revolving continuously through the cycle of purchase, storage and resale of commodities.

He called for stronger collaboration with farmers' associations, particularly the All Farmers Association of Nigeria (AFAN), which he said would be key to identifying genuine farmers and spreading information about the scheme in farming communities.

BOA said it had already engaged more than 40 radio stations across the country to sensitise farmers in different Nigerian languages, and urged farmers' associations to take the message further into rural communities.

Sotinrin said the programme was designed to benefit hundreds of thousands, potentially millions, of farmers, with an expected impact on more than 11.5 million households nationwide. He described the intervention as proof of the government's commitment to resolving farmers' concerns and strengthening Nigeria's agricultural value chain.