The Bank of Agriculture (BOA) has unveiled a N200 billion Guaranteed Minimum Price (GMP) Programme aimed at protecting Nigerian farmers from steep falls in commodity prices while helping to bring greater stability to the country’s food market. Launched in Abuja under the Federal Government’s Renewed Hope Agenda, the initiative is expected to reach more than […]
The Bank of Agriculture (BOA) has unveiled a N200 billion Guaranteed Minimum Price (GMP) Programme aimed at protecting Nigerian farmers from steep falls in commodity prices while helping to bring greater stability to the country’s food market.
Launched in Abuja under the Federal Government’s Renewed Hope Agenda, the initiative is expected to reach more than 500,000 farmers, support the handling of 400,000 metric tonnes of grains and potentially benefit 11.25 million households.
At the centre of the programme is a price guarantee designed to prevent participating farmers from being forced to sell their produce below an agreed minimum price.
BOA Managing Director and Chief Executive Officer, Ayo Sotinrin, said the intervention was developed in response to substantial losses experienced by farmers after prices of major agricultural commodities dropped sharply in 2024 and 2025.
He noted that producers of rice, maize, sorghum and soybeans were among those affected, with some farmers reportedly selling their crops below production costs after market prices fell beneath import parity.
The GMP arrangement will only activate when market prices fall below the agreed floor. If prices remain above the guaranteed level, participating farmers will retain the freedom to sell their commodities at prevailing market rates.
BOA said the structure is intended to give farmers greater confidence to continue investing in production without removing their ability to benefit from favourable market conditions.
Sotinrin said restoring confidence among producers was essential to preventing farmers from abandoning agriculture because of weak or unpredictable returns.
The bank stressed that the programme is specifically targeted at genuine farmers who produce the eligible commodities and have been affected by depressed prices.
Traders who simply purchase grains from open markets will not qualify for the guaranteed price mechanism.
Sotinrin called on the All Farmers Association of Nigeria (AFAN) to help identify and mobilise genuine producers who meet the programme’s requirements.
The programme will rely on farmer aggregation companies to source commodities directly from participating producers and organise their collection and storage.
Payments to farmers will be processed through BOA’s technology platform, while aggregation companies will receive a fee based on the volume of commodities they handle.
The arrangement is expected to create a more structured connection between farmers and the wider agricultural value chain while improving the efficiency of commodity collection and marketing.
The programme goes beyond protecting farmers when prices fall. BOA also plans to build a strategic commodity reserve that can be deployed when market prices rise sharply.
According to Sotinrin, the bank can release stored commodities into the market during periods of excessive price increases. The move is intended to help moderate costs for consumers, millers and food manufacturers.
The mechanism therefore seeks to address both sides of the market: protecting farmers from distress sales while helping processors avoid paying excessively high prices for raw agricultural commodities.
Sotinrin said the N200 billion facility should not be viewed as a one-time government expenditure. Instead, the bank intends to operate the initiative as a revolving market mechanism.
Under the model, commodities purchased from farmers will be stored and subsequently sold when market conditions justify their release. Revenue generated from those sales will then return to the system to support additional interventions.
The BOA press kit estimates that 85 per cent of the programme’s funding will be recovered through commercial sales, and emphasises that the facility is not designed as a subsidy or grant.
Agricultural micro, small and medium-sized enterprises could also gain from the initiative through opportunities in aggregation, warehousing, transportation, processing and commodity marketing.
By providing farmers with greater certainty around prices, the scheme could also give small and medium-sized food processors more predictable access to agricultural raw materials.
The Nigerian Commodity Exchange (NCX) is expected to play a role in supporting the market infrastructure required for the programme.
NCX Managing Director Anthony Atuche said the exchange would provide the infrastructure needed to facilitate the initiative and strengthen connections among farmers, aggregators, processors and markets.
BOA expects the programme to contribute to efforts to improve the reliability of food supplies while reducing some of the price volatility affecting Nigeria’s agricultural sector.
