Economy

Subsidy: Food prices soar as Labour Union mobilises for strike

The prices of major foodstuffs and other essential goods have started rising in response to the hike in the pump price of Premium Motor Spirit, popularly known as petrol, following the announcement by President Bola Tinubu that the era of subsidy on the product is gone.

Tinubu had on Monday during his inaugural speech at the Eagle Square in Abuja said the era of subsidy payment on fuel had ended, adding that with the 2023 budget making no provision for it, further subsidy payment was no longer justifiable.

He added that his administration would instead channel funds into infrastructure and other areas to strengthen the economy.

The presidential pronouncement led to an instant resurgence of fuel queues across the country with Nigerians foraging for the premium product. Though Tinubu’s decision received the backing of the NNPCL and the House of Representatives, it has since been resisted by the NLC and the Trade Union Congress of Nigeria.

According to the organised labour, the President cannot unilaterally take a decision on subsidy removal.

Currently, petrol sells for between N495 and N600 per litre across the nation from N185 to N220 until Monday.

A survey conducted by Sunday PUNCH in various states of the federation on Saturday showed that apart from the increase in transport fares, the prices of foodstuffs, soup ingredients, daily provisions and other essential goods had started rising with expectations of further increment as manufacturers and retailers adjust to the new fuel regime.

Lagos and Ogun

In Lagos, the prices of foodstuffs like rice, yam, beans, garri, plantain, yam flour, semovita, corn, frozen chicken, turkey and palm oil have increased with traders anticipating further rise in the days ahead, even as families have started making panicky purchases to stock their homes with foodstuffs ahead of the strike called by the Nigeria Labour Congress for Wednesday to protest the soaring pump price of petrol.

A shop owner at Jakande Market in Lekki, identified only as Madam Linda, said there had been more traffic than usual to her shop by families trying to buy up the available food items in anticipation of further rise in prices and because of the planned strike by the organised labour.

Although the woman, who sells bags of rice, beans, vegetable oil and palm oil, among others, said the prices of foodstuffs had only increased marginally, she predicted that in the coming week, there might be a further surge in prices.

She said, “Many of my customers have said they want to stock their houses with enough foodstuffs because they don’t know what else to expect due to the increase in transport fares.

“It’s also the first Saturday since the month of May ended, so people have enough cash to buy plenty of foodstuffs now before prices go up significantly.”

Linda still sells her old stock of rice for N37,000 per bag, but said when the new stock arrives in the coming week, a bag of rice would likely sell for between N40,000 and N43,000.

But another rice seller, Favour Obiora, was already selling a bag for N45,000, explaining that the increase in price was as a result of the rise in transport fares since subsidy on fuel was removed.

“As of two weeks ago, a bag of rice was still selling for N38,000, but now I am selling N45,000 because of the transport charges by suppliers. The cost of transportation has almost doubled; so, we have to increase our prices in order to make profits as well,” she said.

A yam seller, Ibrahim Musa, sold a tuber of yam for N3,000 as against N2,000 before the subsidy removal, attributing the increase in price to not only transport fares, but the seasonal scarcity of old yams as well.

Musa said, “It’s old yam that is available now; the new yam has not come out. It is the same thing for plantain. It isn’t the season; so they are more costly than before.

“But the increase in transport fare is also a factor, but it is majorly because yam and plantain are not in season now.”

Sunday PUNCH, however, gathered that a 25-litre keg of vegetable oil was selling for N38,000 instead of N34,000, while a bunch of plantain was selling between N6,000 and N8,000 same as it was before the fuel subsidy removal.

In the Ojodu area of the Ikeja Local Government area of Lagos State, prices of food items recorded a slight increment on Saturday.

A foodstuffs trader, who identified himself simply as Ikechukwu, noted that there had been a slight increment in the prices of some of the items and the prices could possibly go higher in the coming days.

He said, “We sell 10kg of semolina now for N6,800 to N7,000 instead of less than N6,000 a week ago. Also, a bag of the short grain rice goes for N34,000 and the long grain rice goes for N39,000 as against N32,000 and N37,000, respectively before now.”

In Ogun State, a trader at the Magboro Market, Mrs Ola Ajiboye, said, “Before Tinubu was inaugurated, a bag of rice was N30,000 , now it is N33,500. The price of one bag of beans was between N40,000 and N45,000, but it is now N55,000. Also, I used to buy a bag of garri for N14,000 or N15,000, but now it is N20,000. However, a 30-litre keg of palm oil was N27,000, but it has now come down to N25,000.”

 “There is no panic-buying by customers because there is no money and they spent their disposable income on other things, which have also increased in prices due to the subsidy removal. Since the NLC is planning to go on strike next week, I see it affecting the prices of food items too,” a trader, Daniel Chukwu, said.

A palm oil dealer, Mrs Grace Abiodun, said the cost of transportation due to the fuel subsidy removal was the reason for the high cost of most foodstuffs in the state.

In Arepo, it was gathered that semolina, which was previously sold for N6,800 a bag had increased to N7,000, while the 1kg rose from N600 to N750, while a carton containing 20 pieces of spaghetti was currently selling for N9,500, reflecting an increase of N1,500 from the previous price.

A trader, Idayat Akanji, said some of the distributors had informed the retailers that the prices would be reviewed further by next week.

Another trader, Mrs Fatima Ogunbayo, stated, “Before, a four-litre tin of garri sold for N800, but now it is N1,000 toN1,100 because we now buy a bag for N20,000 instead of N17,000.

“The same measurement of yam flour was N1,500, but it is now N1,700, while that of corn was N1,200, but it is now N1,400.”

Visits to some markets such as Lafenwa, Omida, Kuto and Panseke in Abeokuta on Saturday revealed that the prices of garri, beans and rice had increased by at least five per cent.

According to a foodstuffs seller at the Panseke Market, Ramota Aleji, a bag of rice previously sold for N30,000, but it is now N31,500, while a bag of beans now sells for between N32,000 and N45,000 instead of N31,000 and N43,000 previously.

A trader at the Lafenwa Market, Kujenya Adebisi, said garri was now N21,000 for a bag as against the initial price of N19,000.

A food vendor, who spoke on condition of anonymity, said the increase in foodstuffs prices had affected the portion of food she dishes out to customers, adding that some foodstuff sellers who had the items in stock before the increase in petrol price, raised the prices without considering the people.

“We have reduced the portions of our serving as well as the ingredients. As you know, we don’t sell soup and all the expenses are only on the other items that we can sell like eba, semovita, rice, etc,” she said.

A foodstuffs seller in Magboro who gave her name as Mrs Ayobami told Sunday PUNCH that she has had more customers who patronised her on Saturday morning than she had since Thursday.

She said, “Today, since this morning when I opened the shop, there has been an increase in people buying foodstuffs here. It’s often like that every weekend, but this time, I think it is because they said workers will embark on a strike on Wednesday.

“I have not made such a level of sales since three days ago, and I am sure there will be more of these marathon purchases tomorrow (Sunday) and also on Monday.

A supermarket owner in Magboro, who gave her name simply as Mrs Olukayode, said food prices had soared from their original prices.

She said, “You know there is fuel subsidy removal, most of the food items that we purchased in the past few days have increased from their original prices. The only exceptions are the goods that we purchased before the fuel hike.

“For example, Golden Morn, which used to be N1,800, has increased to N2,000; spaghetti from N8,000 to N8,600 and Hollandia milk from N9,000 to N9,200.”

 FCT

At the Federal Capital Territory, it was a similar situation. At the Nyanyan Market, Abuja, and One-Man Market, Nasarawa State, prices of goods and foodstuffs have started rising as a tuber of yam now costs N2,300 instead of N1,500 previously. Also, the price of rice has risen. A bag now goes for N37,000 as against N32,000 before the removal of fuel subsidy.

A nurse, Mrs Kabirat Bello, who spoke with one of our correspondents at the Nyanyan Market, said she was there to restock following the strike notice by the NLC.

Bello said, “Normally, I am supposed to come to the market next week, but I decided to come early following the strike notice by the NLC. I cannot wait to be caught unawares. My children and family members need to eat even though we are now spending more than necessary on food items. But what do we do?

“Even vegetables that are supposed to be everywhere now because of the rain are expensive. Aren’t we in for a shock in this country?”

Our correspondents observed that at the Karu Market, many residents trouped out to purchase food items in anticipation of Wednesday’s strike.

For instance, at the Ford Mart Shopping Mall in the Karu Local Government Area of the FCT, shopping activities went on normally without people crowding the mall to indicate panic-buying.

The McRay Mall and the Market Square also in Karu only saw a slight increase in patronage by customers.

Rivers, Delta, Enugu

Some residents of Bonny Island and Port Harcourt areas of Rivers State have engaged in panic-buying of foodstuffs and other essential household items.

A housewife in the Port Harcourt metropolis, Mrs Sowanari Benstowe, said the price of rice had skyrocketed from N32,000 a bag to N36,000 in two days.

Benstowe stated, “I went to the market yesterday (Friday) to buy rice so that I could stock it at home because of this strike that the NLC is calling for, but the price made me think twice. I could only buy half of a bag at N17,000.

“The price for tomatoes has also increased. We used to buy six or seven pieces for N500, but now, I bought four balls for N500. I wonder how much a basket will cost now.”

A housewife in Eleme, Joy Teme, said she bought a bag of rice last month for N34,000 but was shocked when she got to the market on Saturday to discover that it was now N40,000, adding that she had to buy two bags because the price would likely go higher.

In Bonny LGA of the state, the situation seemed to be worse, as the prices of goods spiked by almost 50 percent.

A foodstuffs retailer, Mrs Comfort Pepple, said she got local rice for N36,000 a bag on Thursday, but was told by her supplier that the price had gone up to N45,000.

“I had to rush and buy five bags. I have also decided to close my shop to watch the situation, because the man (supplier) told me that with the way things are going, it may get up to N50,000 per bag,” she said.

A restaurateur in the area, Mrs Mfon Etuk, said she went to the market to buy palm oil but could not even get a keg.

“The sellers said the price increment was because of fuel subsidy removal. If I knew, I would have bought the ones I saw on Wednesday and stocked my restaurant,” she stated.

In the Kwalle Local Government Area of Delta State, a retired schoolteacher, Mrs Patience Ezeogwu, said the prices of rice, garri and other staple foods had skyrocketed.

Ezeogwu said, “I used to buy a paint bucket of rice for between N3,700 and N4,000. Now, it is more than N4,500. I went to the market today (Saturday) with N30,000 to see how I could buy some things and stock my house even though I had gone to the market last week, but I couldn’t buy anything meaningful.

“I couldn’t even get a frozen fish of N800. The sellers were saying it was N1,500. Meanwhile, I got some for N600 last week. When I ask, they said it was because of fuel subsidy removal. I am retired and depend solely on my pension. This has affected me.”

She added that the market was full to the brim with people buying as many as six bags of rice and above.

“It was like during the COVID-19 lockdown in 2020. A woman here before your call came in her car and bought more than eight bags of rice. When I asked how much she got a bag for, the traders said it was N45,000 per bag. How can I afford that?” she queried.

At the New Market, Enugu, a 50kg bag of rice, which sold for N35,000 a month ago, went for between N45,000 and N50,000 on Saturday depending on the brand. A bucket of corn, which sold for N1,500  in April and May, exchanged for N2,000, while a 25-litre keg of palm oil exchanged for N32,000 instead of N25,000.

Sokoto, Katsina, Borno

Traders in Sokoto State are, however, lamenting lack of customers, even as prices of goods continue to soar.

One of our correspondents, who visited the popular Old Market in the Sokoto metropolis, saw many traders lamenting low sales as compared to before now.

Alhaji Usman Bala, a dealer in soft drinks, decried the situation of things since the removal of fuel subsidy.

He said most of the sales being recorded in the last few days were from his customers from the neighbouring Niger Republic.

“Thanks be to God for those that come from Niger Republic, who normally patronise us here, maybe by now, we would have been thrown out of the market,” he said.

A survey by one of our correspondents showed a slight increase in the prices of goods in the market. A 50kg bag of rice now goes for N35,000 as against N33,000 before the removal of subsidy on petrol.

There have been marginal increases in prices of basic items in many Katsina markets since Monday when the Federal Government announced the removal of subsidy on fuel.

Investigation, however, showed that there was no panic-buying by customers, notwithstanding the NLC directive to workers to commence a nationwide strike from Wednesday.

Findings at the Central Market, Kofar Marusa and Sabo Kasua in Katsina on Saturday showed that there were marginal increases in the prices of food items such as yam, rice, beans and vegetable oil.

Traders said they were anticipating higher increases in the prices of the items this week when current stock would have been exhausted and they would have to travel to buy fresh items.

At the Central Market, a bag of rice sold for N36,000, while a bag of beans sold for N 40,000, while three tubers of water yam went for N2,700.

A 25kg keg of vegetable oil sold for N30,500 on Saturday, while 50kg of granulated sugar exchanged for N37,000. Majority of the items sold for at least N 1,000 last weekend before the subsidy removal announcement.

At the Monday and Gamboru markets in Maiduguri, Borno State, Sunday PUNCH observed a normal flow of trading activities on Saturday.

Most buyers and sellers acknowledged receipt of the news of a possible strike, but said poverty had made them resilient to shock.

“Where is the money for me to rush to the market to stockpile any basic needs?” a civil servant, Abdu Abubakar, queried, stating, “You need to have money first before you engage in any panic-buying.”

A civil servant, Ibrahim Mohammed, said the majority of his colleagues did not have enough resources to engage in panicky purchases because they had since spent their May salaries.

 Edo, Delta, Abia

Madam Patience, who owned Mama Jude Store on Ebo Street, Benin, Edo State, said the removal of oil subsidy had led to the increase in the prices of food items.

She said the local rice, which used to sell for between N30,000 and N32,000, was now selling for N37,000, while a bag of the foreign parboiled rice, which used to sell for about N42,000, now sells for between N48,000 and N50,000.

Bean has also increased in price by about N7,000 per bag to now sell for between N45,000 and N55,000 depending on which part of the country it is purchased from.

At a major mall on Sapele Road, the prices of the goods are still the same, with customers commending the management, while wondering how long the prices would remain unchanged.

Surveys conducted in Warri and Effurun, Delta State, showed a sudden upsurge in the demand for food items and consumables by residents.

One of our correspondents, who visited the Igbudu Market in Warri and the Effurun Market at Jakpa junction, reported panic-buying of food items and essential commodities by the residents.

A rice dealer at the Igbudu Market, Mrs Cecilia Abednego, said her sales record as of 1pm on Saturday “has been quite impressive compared with the other days.”

Abednego stated that some of her customers “have been mentioning an impending strike” as the main reason for the bulk purchases.

The situation was similar at the MacCaiver Market in Warri, where upsurge in demand for food items was noticeable among buyers.

One of our correspondents reports that there has been a minimal increase in the prices of food items and other essential commodities in Abia State with no panic-buying yet as most residents lack the purchasing power.

At the Ubani Market, Isi-Gate and Orie Ugba Ogwumabiri Express, all in Umuahia North; Apumiri Ubakala, Ahiaukwu Olokoro and Afor Ibeji in Umuahia South; Ndioro and Aruan markets in Ikwuano LGA, the prices of goods did not show much increase.

A bucket of garri that sold for between N1,700 and N1,800 has now crashed to N1,400/N1,500, but the prices of other foodstuffs increased marginally.

Ekiti, Kwara, Oyo

Traders at the popular Oja Oba, Oja Bisi and Okesa Market in Ado Ekiti, the Ekiti State capital, hinted that the increase in the pump price of petrol might start reflecting in the prices of foodstuffs this week.

The situation at the markets on Saturday showed that there had not been panic-buying.

A grains trader at Oja Bisi, Alhaja Ruka Adesina, who said transport fares had doubled since Wednesday when the NNPCL came up with the N500 per litre fuel price, said, “There is no way it will not affect the prices of goods and commodities.”

Adesina, who said the prices of commodities, particularly foodstuffs, had not increased despite the high pump price of petrol, said, “We are still selling at the rates we sold some weeks back. The prices have not changed.

“A measure of long grain foreign rice is N1,400, short grain is N1,200, while the same measure of local rice goes for N1,500. A measure of white beans goes for N750, while that of garri is N400. We are still selling at the same old prices.”

Also a rice trader at Oja Bisi, Mrs Christianah Alade, who said there had not been any increase in prices occasioned by the fuel price hike, said, “We sell a bag of small grain foreign rice for N36,000, while a bag of long grain goes for N40,100. Although prices are not stable, a bag can be sold at a higher price depending on the bargaining ability of the buyer.”

A yam and fish seller at the Okesa Market, Oluremi Ajenifuja, “It is still the same prices that we are selling. The prices for five tubers of yam vary depending on the size. We sell one for N2,500, N3,500, N5,500 and N7,000 depending on the size.

“We have been coming to market here with over 100 per cent increase in fares, but we have not gone to replenish our stock; it is the prices at which we restock alongside transport fares that we will sell when the time comes. I am sure that the prices will not remain the same next (this) week, because nobody can expect us to run at a loss.”

Prices of soup ingredients, including tomatoes and pepper, went up on Saturday in some markets in Kwara State as a result of the increment in transport fares.

At the Mandate Market in Ilorin, a basket of tomatoes sold for N58,000 as against N50,000 it was sold on Friday, while a basket of two species of pepper exchanged for between N16,000 and N25,000 instead of N9,000 and N14,000 on Friday.

A trader, Alhaja Zainab Azeez, said although it was the tail end of the tomato season in the North, the increment in the prices of the commodities was too wide.

She attributed the astronomical rise to the increase in transport fares, which she said was caused by the increment in petrol price.

A digital marketer, Uthman Adeleke, who was at the Bodija International Market, Ibadan, Oyo State, stated that he suspected that there would be a further increase in the prices of food in the next few days due to the removal of fuel subsidy and he was preparing for that.

He said, “We have been in this country for years and know the trend. Immediately petrol goes up, almost everything in the country rises with it. Even traders who have old goods will be forced to increase prices. I sense food and other raw materials’ scarcity because of this subsidy issue.

“I can’t stand my family going hungry because of a reckless statement or a reckless decision by the President. I’ve come to stock food at home for the next two months to cushion the effect of what is to come.”

A bag of rice sold between N32,000 and N34,000 in the market on Saturday, while a 25-litre keg of groundnut oil sold for N31,500. However, a chat with some traders revealed that the prices of the goods might not remain the same by Monday.

CSO begs Tinubu

Meanwhile, a civil society organisation, Community of Advocacy for Positive Behavioural Patterns Initiative, on Saturday called on the President to cushion the effects of the removal of fuel subsidy especially on the low income earners and youths in the country.

The organisation said this became necessary to enable Nigerians secure their right to adequate standard of living and avoid further hardship.

The Director of its Campaign Team, Bamidele Mann, raised the issue in an open letter to Tinubu obtained by journalists in Abuja.

He said, “Your Excellency, we want you to protect and cushion the effect of the removal, especially on the low income earners and youths, to enable us secure the right to adequate standard of living and to avoid further hardship.

“Consequently, many are terrified that they may not meet their daily needs, which could be absolutely excruciating.

“As the father of the nation, we seek your support in this regard as we are prepared to work with you to create a system that works. We are optimistic that the right attitude will take us through the journey.”

 NLC writes affiliates

Meanwhile, the Nigeria Labour Congress has written all its 43 affiliate unions to mobilise for a strike slated to begin on Wednesday to protest the increment in the pump price of the petrol following the removal of subsidy on the product.

Some of the affiliate bodies of the NLC are the Academic Staff Union of Universities, Academic Staff Union of Polytechnics, Nigeria Union of Teachers, Judicial Staff Union of Nigeria, and the National Association of Nigeria Nurses and Midwives.

In a letter written to the affiliates, which was signed by the NLC General Secretary, Emmanuel Ugboaja, the congress said, “We bring you greetings from the leadership of the Nigeria Labour Congress. You will recall that arising from the National Executive Council meeting held on 2nd of June, 2023, it was decided that the congress will embark on a nationwide action and withdrawal of services against the fraudulent increase in the prices of fuel across the 36 states of the Federal Republic of Nigeria and the FCT.

“Please be informed that the nationwide action will commence on Wednesday, 7th of June, 2023. To this effect, all national leaders are expected to mobilise their members for the action and ensure full compliance with the directives as services in both the public and private sectors are expected to be fully withdrawn by Wednesday, 7th of June, 2023. All presidents and general secretaries are expected to help ensure the implementation of the decisions of the National Executive Council.”

Similarly, the National Association of Nigerian Students will hold a NEC meeting on Tuesday on the soaring fuel price.

(Punch)

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