Fuel price rise killing businesses with higher operating costs
By Jeph Ajobaju, Chief Copy Editor
Diesel now sells for N800 per litre and petrol has within a week risen from between N162 and N165 per litre official price to between N170 and N300 – depending on where and from which station motorists fill their tanks.
Stakeholders in agriculture and Small and Medium-Sized Enterprises (SMEs), backbones of the economy, have expressed concern over the inflationary multiplier effects of these rising energy prices on all goods and services.
Niji Group Chief Executive Kolawole Adeniji said diesel price hike is hitting agriculture hard with a negative impact on food production.
He lamented that farmers’ input costs are rocketing, citing fertiliser, pesticides, and herbicides which have seen staggering price increases.
He expressed concern that this would impede farmers’ ability to produce more food with diesel price increase riding on a sharp rise in the cost of other inputs.
Niji Group is a conglomerate with about three decades’ experience of providing solution to Africa’s agriculture sector.
It holds investment portfolios which include Agricultural Machinery and Equipment Manufacturing, Farming, Food Processing, Agribusiness Education, Farm Mechanisation, and Hospitality.
Niji Group lists its service offerings on its website to include but not limited to Corporate/Contract farming; Food factory installation – Starch, HQCF, Fufu, gari; Agro-equipment fabrication; Agribusiness education; Technical partnership; Tractor and implements; Animal feed processing.
Adeniji reiterated that the rise in the price of diesel has increased agricultural input costs, as farmers are paying more for fuel.
He said consumers are negatively affected, with the price increases set to drive up food inflation through higher transport costs and put more strain on consumer spending through personal transport costs.
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Call for govt intervention
Association of Micro Entrepreneurs of Nigeria (AMEN) President Saviour Iche urged Abuja to intervene in the price of diesel to save jobs, saying if nothing is done to help businesses, Nigeria is in for more job losses.
He reiterated that diesel price increase puts pressure on SMEs value chain, shrinking profits, and making it difficult for them to absorb costs.
“A lot of entrepreneurs are on life support. Don’t be surprised if we start buying a sachet of water for N20,” Iche warned, per The Nation.
Badebo Solomon, a printer, described the situation as grievous.
“If we are buying diesel for N800 per litre and N24,000 for 30 litres, what can we achieve running the generator for two hours? It is taking away the profit. It is sad the government is not doing anything about it,” he lamented.
