FG May Incur Insurance Claims on Rotten Yam Exports

Facilitates $325m Chinese agribusiness loan
Olawale Ajimotokan and Cynthia Offor in Abuja
The federal government may prosecute the agents who caused Nigeria’s yam consignments to the United States to be rejected, raising concerns that the rejection of the commodity may lead to payment of insurance claims to yam exporters.

The euphoria around Nigeria’s export of yam to the US and United Kingdom was dampened after reports emerged that the yams were rejected in the US after they were found to have gone bad.

THISDAY checks revealed last night that some yam exporters have been pestering the insurance firm for compensation to cover the substantial losses from the rejected exports.
It is in the light of this development, according to highly placed sources, that government is thinking of prosecuting the agents behind the export.

The agent is accused of negligence by choosing to transfer the yam consignment to another part of the country after certification instead of bringing the items to the port.
It was in the process of picking other yam consignment in another location in the northern part of the country that the 20-day period of handling the goods before export was exceeded.

In the process, the quality of some of the yams was compromised while some of them were damaged arising from loading of new yam on top of them.

“It is a case of poor handling of the yam by the agents after they were certified by government agency coupled with the fact that he tried to save cost by diverting them to another point to enable him load other consignment marked for export, instead of transferring the goods to the port. That invariably made some of the yams to become rotten, leading to their outright rejection when they landed at their final export destination,” a source told THISDAY last night.

The Minister of Agriculture and Rural Development, Chief Audu Ogbeh, also recently alluded to the blunder by the exporter, saying the container was left in Nigeria for two months before it left in very hot environment.

“Government does not export yam. We flagged it off, but someone left it here for two months in a hot environment. What I find extremely nauseating is that somebody seems to be celebrating the fact that Nigerian yams were rejected as if it was a victory for him as an individual. It happens all the time that commodities get bad because of poor handling. You don’t take things that are perishable,, keep them in bad conditions, ship them out and embarrass Nigeria,” Ogbeh lamented.

Meanwhile, the federal government has facilitated the establishment of 12 large scale rice processing mills under the China EXIM Bank $325.67 million facility.

The mills, according to Ogbeh, were part of the targeted 40 in number, 30,000 metric tonnes per annum integrated large scale mills.

He also said government had also aided the completion of mills that are capable of producing 2.5 tonnes and 1.8 tonnes of paddy rice in Badeggi, Niger State at the cost of $1.8million under the Korean- African Food and Agriculture Corporation Initiative (KAFACI) Programme.

The project was revived after it was abandoned by the President Shehu Shagari administration in the early 1980s.
He also said government has commenced the restructuring of the Bank of Agriculture (BOA) in order to ease credit facilities for Nigerian farmers and stimulate interest of people in farming as a source of livelihood.