06 Jun

Daily Watch – Import cover falls to four months, Pesticide found for tomato bug

  • The resurgent militancy in the Niger Delta has reduced Nigeria’s production capacity by at least 140,000 barrels per day. While the Nigerian Agip Oil Company has shut its Bayelsa facility which produces 65,000 bpd, Aiteo, which operates the Nembe Creek Trunk Line has also stopped its 75,000 bpd facility in Bayelsa. Earlier attacks in NAOC oilfield on May 18 and 24 resulted in the shutdown of some 5,200 barrels of its equity share of oil output. A spokesperson for Agip confirmed the development in a short e-mail response to the News Agency of Nigeria. According to crude production figures provided by Agip, Nigeria is losing about $3.12 million in revenue each day its facility remains out of production. Also, Shola Omole, spokesman for Aiteo said the Nembe Creek Trunk Line which came under attack by Niger Delta Avengers on May 28, conveyed crude to Bonny export terminal, had been shut. Omole explained that the 75,000 bpd was deferred as the line remained out of service.
  • The National Research Institute for Chemical Technology, Zaria, say they have found a pesticide capable of killing a species of moth, Tuta absoluta, that has ravaged Nigeria’s tomato crop. The Tomato Leaf Miner moth has destroyed over 80% of tomato farms in the North where it is grown in commercial quantities. NRICT’s spokesman, Bala Aliyu, was positive that the vaccine would soon be launched, adding that it was the responsibility of the Federal Government to get the vaccines to the end-users, farmers. However, farmers affected by the moth will have to wait as the new pesticide is not yet ready for commercially purpose. The disease has drastically reduced locally available fresh tomatoes, forcing consumers to buy canned purees or pastes which are relatively cheaper to buy.
  • An investigation by BusinessDay has shown that the CBN’s foreign exchange policies and ability to defend the naira are facing a further squeeze as Nigeria’s dollar reserves have fallen to just over 4 months of import cover, a figure that is below the IMF’s recommended six months. Data from the CBN shows that gross official reserves declined by $700 million in May on a 30-day moving average basis to $26.4 billion. Reserves at May-end provided merchandise import cover of 6.1 months and 4.4 months when services are included, according to FBN Quest. “The authorities have limited weekly FX sales at the CBN’s rate of ₦197 per US dollar to about $200 million yet are still struggling to contain the depletion in the face of strong, but easing import demand,” FBN Quest analysts led by Gregory Kronsten said in a note to investors. The CBN estimated in January that its monthly supply of FX for sale had slumped to $1 billion.