FG concessions 19 silos to 7 firms, targets N10.4bn annual revenue

May 22nd, 2019

By Adelola Anihere

The Federal Government will rake in a revenue of more than N6 billion annually from its concession of 19 silos across the country to seven compa nies as profit share, the Director General, Infrastructure Concession Regulatory Commission (ICRC), Mr. Chidi Izuwah, has said.

This is aside the N3.4 billion they have to pay annually as the concession fee whether or not they do business bringing the total to N10.4 billion.

Speaking during the handover ceremony of the concessioned silos to successful concessionaires in Abuja on Tuesday, the Director General pointed out that the assets hitherto abandoned or not put to good use were being transformed to create value and would also yield financial benefit to Nigerians.

He said: “Post-harvest loses contribute close to 50-60 percent of agricultural loses, the silos will be put to use and farmers would not only produce and allow them to store. And it would help the country attain food sufficiency

“For those 19 silos being handed over, the total upfront fee being paid to the concessionaires is N1.3 billion, and the fixed annual fee to be paid by the concessionaires is N3 billion.

“From the forecast profit of the operation the Federal Government is expecting a minimum of N6 billion annually as concession fee to the treasury.
While shedding light on the concession process, Mr. Izuwa revealed that the ICRC got 39 bids which were transparently evaluated by transaction team made up of transaction adviser, Federal Ministry of Agriculture, the technical services of the Federal Ministry of Finance, the World Bank project implementation team.
This transaction process was sponsored by the World Bank while the EFCC and ICRC served as observers.

Delivering his key note address, the Minister of Agriculture and Rural Development, Audu Ogbeh who advised the companies to take good care of government assets also reeled out some standard measures to ensure that grains stored meet international standards.
“In storing your grains, please take the following steps: we have a problem with aflatoxin and it’s getting worse with rising temperature. So please when you take over the silos, spray them with aflasafe which IITA is now producing.

“Two, request from those selling you grains to bag them in jute bags not polypropylene bags. We will soon start large scale private sector production of jute bags to replace polypropylene bags which are no longer accepted by the FAO.

“Three, check for moisture content. Moisture metres are not too expensive if the grains have more than 5% moisture content, they are not safe for storage. If they go into storage, they begin to gather molds and molds in the human body doesn’t do any good.

“Talking of aflatoxin, it causes liver problems and doesn’t allow chickens to grow well. We are then largest producer of maize but companies like Nestlé and even big poultry farms will not buy our maize but prefer to import. Why? because of aflatoxin”.

The Federal Government is keeping six out of the 33 silos it currently has and has concessioned 19 with the highest having a holding capacity of 100,000 metric tonnes to 25,000 metric tonnes

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