In a historic turn, Nigeria has recorded single-digit food inflation for the first time in over a decade, signalling a monumental pivot in the cost of living for millions of households.
After years of grappling with skyrocketing prices of staples like rice, maize and yams, often exacerbated by supply chain disruptions and currency volatility, the downward trend marks a significant cooling of the cost-of-living crisis.
While Nigeria’s headline inflation rate moderated slightly to 15.1 per cent in January 2026, down from 15.15 per cent recorded in December 2025, according to the latest Consumer Price Index report released by the National Bureau of Statistics (NBS) yesterday, food inflation, the largest component of household consumption basket, fell sharply in the January, providing a huge relief to consumers.
On a year-on-year basis, food inflation stood at 8.89 per cent, a steep drop of 20.73 percentage points from 29.63 per cent recorded in January 2025.
Month-on-month, food prices declined further to –6.02 per cent, compared to –0.36 per cent in December 2025, representing a decrease of 5.66 percentage points.
The month-on-month trend, which shows the intensity of inflation, suggests an entrenched deflation or negative inflation, in technical terms.
Fast-dropping food prices are bad news for farmers who are struggling to cut their losses following the recent sharp decline in prices of food items. But beyond farmers, the Centre for Promotion of Private Enterprise (CPPE) said the uncontrolled crash of food prices threatens long-term price stability, calling for a market-friendly stabilisation mechanism.
For a population that spends a substantial portion of its monthly income on basic consumption, the shift from persistent double-digit inflation to a more stable pricing environment represents more than just the data; it is a vital reprieve for the country’s most vulnerable citizens.
Market analysts attribute this cooling period to a combination of factors – aggressive monetary policy interventions, seasonal impact, stronger naira and food import waiver.
The food basket states, which had previously faced significant output challenges, have seen a resurgence in food production.
Analysts noted that while the broader economy still faces structural hurdles, the achievement of single-digit food inflation suggested that the long-awaited stabilisation of the naira is finally trickling down to ordinary citizens.
At 8.89 per cent, food inflation returned to levels last seen more than a decade ago, marking the culmination of a dramatic seven-month descent from the high trend that defined much of 2024.
Food inflation had reached an all-time peak of 40.87 per cent in June 2024, a crisis that pushed millions of Nigerian households to the brink of food insecurity.
The CPPE described the shift as real disinflation rather than temporary price volatility, pointing to broad-based easing across both food and core inflation components.
The moderation, according to the CPPE, carried substantial welfare benefits because food accounts for the largest share of household expenditure in Nigeria, improving real purchasing power, particularly for low-income households.
However, the centre warned that while declining food prices benefit consumers, they pose serious risks for farm incomes and rural economic stability. The policy brief noted that sustained weakness in farm-gate prices may reduce farmers’ revenues and investment capacity, weaken rural purchasing power, and discourage agricultural production, potentially creating future supply shortages and renewed inflation pressures.
Historical data revealed the anomaly of single-digit food inflation in Nigeria’s recent economic history.
Nigeria’s headline inflation, driven by food, has remained at a double-digit rate since mid-2015, suggesting that the current achievement marks the first return to a single-digit rate since the mid-2010s.
The descent from peak to single digit occurred with remarkable speed. From nearly 40 per cent in December 2024, the rate plummeted through successive months as multiple factors converged.
Still, the triumph of consumers has become the crisis of producers. The Emir of Kano, Muhammadu Sanusi II, recently pleaded with the Federal Government to stop food importation, arguing that farmers spend heavily to produce but cannot recover their costs because their output cannot compete with imported commodities.
The NBS data showed that Nigeria spent N5.27 trillion on food and beverage imports in the first nine months of 2025, flooding the market with cheaper alternatives that have undercut local producers.
The result is a paradox: food prices have become cheap, but agrochemicals and other farming inputs remain alarmingly high, eroding farmers’ income.
The President of Nigeria Agribusiness Group, Kabir Ibrahim, warned that the pervading insecurity and high input prices facing smallholder farmers call for decisive action to avoid imminent severe stresses in the food system in 2026 and beyond.
The CPPE, in a statement signed by its Chief Executive Officer, Muda Yusuf, also called for a clear rules-based and market-friendly farm price stabilisation and farmer income protection framework to prevent import-induced price crashes, reduce harvest-time price collapse, discourage distress sales, and protect farmer livelihoods.
The organisation suggested the introduction of minimum guaranteed prices for selected strategic commodities, including maize, rice paddy, sorghum, and soybeans, operating strictly as a stabilising backstop rather than an open-ended government purchase programme.
With the policy implications extending beyond agriculture, CPPE argued that the disinflation trend created room for cautious and gradual monetary easing, “though this must remain data-driven given that core inflation and 12-month average inflation remain elevated at 17.72 per cent and above headline inflation respectively.”
The organisation emphasised that state-level disparities in inflation highlight the importance of transport costs, security conditions, and supply-chain efficiency in price formation.
For investors and businesses, CPPE noted that easing inflation signals a gradual recovery in real household demand, creating opportunities in consumer goods, retail, logistics, and services. However, it noted that disinflation reduces firms’ ability to rely on price increases for revenue growth, increasing the importance of cost efficiency, productivity, and scale.
It stressed that lower primary food prices may compress margins in crop production but strengthen the investment case for storage, processing, cold chains, and export-oriented agribusiness.
The central policy priority, according to CPPE’s analysis, is to consolidate disinflation while protecting agricultural productivity and rural livelihoods.
The Centre emphasised that achieving this balance will be critical to transforming current price moderation into durable stability, inclusive growth, and improved investor confidence in Nigeria’s economy.
It stressed that without mechanisms to protect farmer incomes and incentivise domestic production, today’s single-digit inflation could sow the seeds of tomorrow’s food shortages, creating a contraction cycle that serves neither producers nor consumers in the long term.
The trajectory of Nigeria’s food inflation over recent years has been tumultuous. Food inflation increased to 40.53 per cent in April 2024, rising 15.92 percentage points higher than the 24.61 per cent recorded in April 2023. The acceleration was driven by multiple shocks, including fuel subsidy removal in June 2023, naira devaluation, insecurity in farming communities and global supply chain disruptions.
The government introduced a 150-day duty-free window in July 2024 for essential food imports as part of efforts to stabilise prices, though the policy never took off effectively, with bureaucratic complexities rendering it ineffective.
On its part, Cowry Research said Nigeria’s inflation rate will maintain a moderating trend in the near term, underpinned by improved foreign exchange stability, relatively subdued energy prices and favourable base effects from last year’s elevated price levels.
According to the firm, the sustained slowdown in both headline and core inflation indicates that underlying price pressures are easing, a development expected to reinforce confidence in the broader macroeconomic environment.
While food inflation may remain volatile, Cowry Research anticipated a generally softer trend in the short term as harvest inflows and improved domestic supply conditions help moderate staple food prices.
The firm, however, warned that structural constraints, including logistics bottlenecks, insecurity in key food-producing regions and weather-related disruptions, could still trigger isolated price spikes.
Cowry Research also noted that the recent Consumer Price Index (CPI) normalisation has created a lower base effect for January 2025 comparisons, which could result in inflation trending above 15 per cent later in the year.
This potential uptick, it explained, may be driven largely by election-related spending pressures and fading base effects, even as structural reforms continue to shape the medium-term disinflation trajectory.
In the immediate term, the firm expects headline inflation to ease further to 14.78 per cent in February 2026, supported by gradual moderation in both food and core components, alongside continued appreciation of the naira following recent policy actions by the monetary authority.
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