The Bank of Agriculture (BOA) has launched a N200 billion Guaranteed Minimum Price (GMP) Programme aimed at protecting Nigerian farmers from depressed commodity prices and stabilising the prices of staple grains in the country.
Managing Director of the BOA, Ayo Sotinrin, who spoke on Tuesday at the launch of the programme, said the initiative would target more than 500,000 farmers and aggregate at least 500,000 metric tonnes of grains.
Sotinrin said the programme was introduced in response to the challenges faced by farmers in 2024 and 2025, when prices of major commodities including maize, rice, sorghum and soybeans fell below import parity, leaving many farmers unable to recover their production costs.
He explained that under the GMP mechanism, eligible farmers who cultivated maize during the 2025 dry and wet seasons would be guaranteed a floor price of N350,000 per tonne where market prices fall below the guaranteed level.
According to him, the programme is designed exclusively for genuine farmers and not commodity traders.
‘This guaranteed minimum price is only for farmers who have planted on their farms and who are suffering with these depressed prices. It is not for traders,’ Sotinrin said.
He warned against attempts by middlemen to buy grains from markets at low prices and present them as farm produce in order to benefit from the scheme.
Sotinrin said the BOA would work with farmer aggregation companies to purchase eligible commodities directly from farmers, with payments made electronically into farmers’ bank accounts.
He added that farmer aggregation companies would receive a fee for every metric tonne aggregated.
The BOA chief executive said the programme would initially cover maize, sorghum and soybeans, while the Nigerian Commodity Exchange (NCX) would provide the warehousing and market infrastructure required to ensure transparency.
He explained that commodities purchased under the programme would be stored in certified warehouses and backed by warehouse receipts after quality, quantity and specification checks.
Rather than allowing the grains to deteriorate in storage, Sotinrin said the commodities would serve as a strategic reserve that could be released into the market when prices rise sharply.
He said that if grain prices rise to levels such as N500,000 per tonne, the BOA could release its stored commodities at a lower price of about N380,000 to N390,000 per tonne.
According to him, the approach would protect farmers on the supply side while also shielding millers, manufacturers and consumers from excessive price increases.
‘When we push grains into the market to reduce the price of grains from N500,000 to maybe N380,000 or N390,000, it means that we have a market stabilisation mechanism,’ he said.
Sotinrin said the programme could eventually become a permanent market intervention mechanism, with funds revolving through the purchase, storage and sale of commodities.
He called for strong collaboration with farmers’ associations, particularly the All Farmers Association of Nigeria (AFAN), stressing that the associations were critical to identifying genuine farmers and disseminating information about the programme.
He said the BOA had already used more than 40 radio stations to sensitise farmers in different Nigerian languages, but urged farmers’ associations to complement the effort by taking information about the scheme directly to farming communities.
Sotinrin said the programme was designed to benefit hundreds of thousands, potentially millions, of farmers and impact more than 11.5 million households.
He described the intervention as a demonstration of government’s commitment to addressing farmers’ concerns and strengthening Nigeria’s agricultural value chain.