1. Aflatoxin Country Assessment for Nigeria Abt Associates, Inc. November 5, 2012

2. Abt Associates | pg 2 Objectives of the Country Assessment in Nigeria To characterize the risks and economic impacts of aflatoxin contamination… …and to identify promising opportunities for control.

3. Abt Associates | pg 3 A Conceptual Framework for Aflatoxin Country Assessment Identify Key Crops of Concern  High Production  High Consumption  High Value Step 1 Determine Prevalence of Aflatoxin  Geographical area of Concern  Percent Contamination  Degree of Contamination Step 2 Characterize Risks of Aflatoxin Contamination and Exposure  Uses of Crop  Risks along Value Chain Step 3 Estimate Economic Impacts  Agriculture and Food Security  Trade Step 4  Health Identify Opportunities for Aflatoxin Control  Institutional, Legal and Regulatory Review  Control Strategies in Agriculture Trade and Health Step 5

4. Abt Associates | pg 4 Data Sources  Nigeria 2010-2011 General Household Panel Survey (part of LSMS-ISA)  Field Research in three locations from different agro- ecological zones – Mokwa, Niger, Lokoja Kogi, Ondo State –Interviews in district capital –Interviews in rural areas  Secondary Data

5. Abt Associates | pg 5 Aflatoxin Prevalence Groundnuts RegionSample Type B1 or Total Prevalence a Mean Concentration b (ppb) Range (ppb) Citation Number Humid Forest k RoastedTotal-23,290-61,240 p -8 BoiledTotal-30,740-54,830 p -8 RawTotal-42,240-64,520 p -8 Derived Savannah m At marketTotal-31.5 q -9 Peanut cakeB1--20-45510 Southern Guinea Savannah n At marketB1100%78 h 74.03- 82.12 11 NigeriaPeanut cakeB1100% d - 2,820 (high) 12 NigeriaPeanut cakeTotal100% o - 12 NigeriaAt marketB1-15.75 r 7-249 Step 2

6. Abt Associates | pg 6 Key Crops of Concern  Maize: third largest in quantity and value, after yams and cassava  Groundnuts: highest reported aflatoxin contamination  Among key cereals: maize has higher concentration of aflatoxins Data Source: CountrySTAT, Year, 2010 Step 1

7. Abt Associates | pg 7 Aflatoxin B1 Prevalence in Groundnuts

8. Abt Associates | pg 8 Aflatoxin B1 Prevalence in Maize

9. Abt Associates | pg 9 RegionSample Type B1 or Total Prevalence a Mean Concentration b (ppb) Range (ppb) Citation Number Maize Humid ForestPre-harvestB118%223-1301 Pre-harvestTotal18%283-1381 Stored maizeTotal-45 e 0-9002 Derived SavannahStored maizeB164%267.32 f 0-1,7223 Weaning food c B1-2,433 g -4 Southern Guinea Savannah Stored maizeTotal-56 e 0-6172 Stored maizeB172%299.6 f 0-1,8743 Northern Guinea Savannah Stored maizeTotal0%0h0h 02 Stored maizeB120%1.5 f 0-83 Southern & Northern Guinea Savannah Freshly harvestedTotal17% d 36 i 1.1-4805 Mid-altitudeStored maizeTotal-83.8 e 0-1,3802 Sudan SavannahStored maizeTotal-75.6 e 0-1,5062 NigeriaMaize-based gruelTotal25%- 0.002- 19.716 6 NigeriaCorn snacksTotal-55-233 j 10-1,0707

10. Abt Associates | pg 10 Characterization of Risks  Risks of aflatoxin on country’s agriculture and food security, trade and/or health sector determined by: –(1) uses of contaminated crop (domestic human consumption, international trade, or feed; –(2) levels of awareness about aflatoxins and aflatoxin control among farmers, traders, and consumers; –(3) the application of tolerances and types of actions taken by regulators and buyers to mitigate the risk. Step 3

11. Abt Associates | pg 11 Uses of Maize and Groundnut Contaminated Products  Majority of maize is for direct human consumption.  2010/11: 78% human consumption, 17% feed and residual uses, small % set aside for re-planting (USDA/FAS).  Avg farming households report selling 41%, keeping 10 % for seed, 1% for feed, with the remaining 46% own consumption or storage (LSMS-ISA).  Groundnuts also ultimately bound for human consumption because the residual from peanut oil production is also consumed in the form of Kulikuli.

12. Abt Associates | pg 12 Characterization of Risks along the Value Chain Are Good Agricultural Practices known and used? What is the awareness level of farmers? Agriculture Are there regulations on aflatoxins for commerce? Are the regulations enforced? Are traders aware about aflatoxins? Trade Are the consumers aware about aflatoxins? Do feeding practices contribute to health risks? Health Forkto Farm

13. Abt Associates | pg 13 Agriculture –Risk of Contamination  Nationally representative data suggests low use of GAP, which promotes good cultural practices to prevent aflatoxin contamination and results in healthier crops with greater resistance –Use of pesticides is low: only 6% for households growing maize and 2% of households growing groundnuts reported using pesticides –Only10% of agricultural households use commercial seeds for maize and 2% use commercial seeds for groundnuts. –Use of fertilizer is relatively higher (20%) for maize, but still very low. –Only 2% of cultivated area under maize is irrigated, negligible for groundnuts –Qualitative field research in three districts suggests that Drying of crops is typically done on the ground Storage units are rudimentary There are few means for moisture measurement and control

14. Abt Associates | pg 14 Agriculture –Risk of Contamination  Awareness among farmers about the causes and consequences of aflatoxins is low.  Agriculture extension systems do not have a set agenda for aflatoxin messaging.  Extension systems are also cash-strapped and over- extended, limiting their ability to incorporate aflatoxin control in their agenda.  Farmers do some basic sorting and drying to gain price premium for cleaner, drier and unspoiled grain but that does not guarantee against aflatoxin contamination.

15. Abt Associates | pg 15 Trade –Risk of Contamination in Market  Standards Organization of Nigeria (SON) has set standards for maximum aflatoxin (and mycotoxin) concentrations for maize, groundnuts, and products made out of groundnuts and maize. –Standard for maize grit, aflatoxin B1, is 2ppb (NIS 718:2010); –Standard for kulikuli (groundnut) cake total aflatoxin 4ppb, aflatoxin B less than 2ppb (NIS 594:2008); –Standard for maize grain mycotoxin is 20ppb (no mention of aflatoxins, NIS 253:2003).  Nigeria’s National Agency for Food and Drug Administration and Control (NAFDAC) enforces these standards –but only for packaged goods and export-bound products  Ports Inspectorate Division monitors imports and exports of packaged and labeled food but inspections for unregulated or unpackaged food products are done only voluntarily  Establishment Inspectorate Division (EID) also offers another layer of scrutiny to packaged goods and inspects companies for their good hygiene practices and good manufacturing practices Yet, there is no systematic mechanism for testing the food safety (or mycotoxins/aflatoxins) of unpackaged foods, which constitutes the majority food intake.

16. Abt Associates | pg 16 Health –Risk of Aflatoxin Exposure  Consumers’ level of aflatoxin knowledge is still very low in Nigeria and exacerbated by some harmful practices  Risk factors include consumption of kulikuli –groundnut cake as well as unhusked maize, bulk or semi-processed  Some farmers (outside of Lagos) reported believing that moldy maize may produce better Ogi (maize-based porridge)  Heavy reliance on maize-based porridges during a child’s weaning stage presents large risk in early life.  Several household post-harvest and meal preparation processes (hulling, sorting, threshing, culling) can be promoted that reduce contamination levels in maize, groundnut and other susceptible crops.

17. Abt Associates | pg 17 Trade –Risk of Contamination in Market  Awareness about aflatoxins is also low among both sellers and buyers  No evidence of testing for aflatoxins in domestic maize and groundnuts markets  Interviews with kulikuli sellers at the oja obamarket in Akure (Ondo State) indicated that visibly moldy groundnuts are usually rejected, but even the rejects may be sold by suppliers to others at a lower cost.  At grain stores in Mokwa (Niger state), and Iddo (market in Lagos) some maize sellers indicated that if moldy maize was discovered in a bag destined for sale, the maize would be washed, sundried and re-bagged and returned to sale.  Aflatoxin control in the Nigerian animal and fish feed market is working much better. Even though there are no regulations on aflatoxin in this sector, the commercial feed formulators are generally vigilant about aflatoxin levels in feed.  Since there is no mandate for withdrawal and destruction of contaminated commodities, grain deliveries rejected by large commercial operations will likely be sold by a trader to smaller feed manufacturers that do not test for aflatoxin.

18. Abt Associates | pg 18 Key Risk and Expected Impact of Aflatoxin Contamination in Nigeria Greatest risk and impact on: Health Low awareness among farmers, traders and consumers. Majority of maize and groundnuts is consumed domestically Low enforcement of existing regulations on aflatoxins/mycotoxins

19. Abt Associates | pg 19 Economic Impact-Agriculture and Food Security  Little or no aflatoxin control by farmers, yet absence of price premium for aflatoxin-free maize, or penalty for contaminated maize, means there are no actual market losses to producers or traders of primary commodities destined for direct human consumption.  On the other hand, suppliers of susceptible commodities--maize, groundnuts, cottonseed--used in animal or fish feed may suffer absolute or partial rejections as well as price penalties. Step 4

20. Abt Associates | pg 20 Economic Impact-Agriculture and Food Security (continued)  All pillars of food security are affected yet not perceived as such Availability -- Aflatoxin-free maize and groundnuts is impacted by this challenge but not recognized by consumers or food markets. Access – Farmers generally do not yet incur loss in farm revenue because of aflatoxin-contamination in their grain. Use of aflatoxin control will imply increased production costs, that may be tempered by premiums on aflatoxin-free crop Utilization – The largest impact of contamination is on human consumption of unsafe and possibly less nutritious products that arises due to lack of aflatoxin control and lack of awareness Stability – Since aflatoxins are dependent on climactic conditions, stability in the other three pillars will vary with prevalence Step 4

21. Abt Associates | pg 21 Food Security: Utilization

22. Abt Associates | pg 22 Calorie Intake by zones. Exhibit 6 ‑ 2: Calorie Intake Share of Foods by Key Zones in Nigeria ZoneMaizeGround nutsRiceSorghumMilletCassavaYam Oil and fats Milk and milk products Other North Central10%1%13%10%3%16% 13%1%18% North East18%4%11%19%13%2% 11%1%19% North West16%1%15%21%17%1%2%13%1%14% South East1% 23%0% 23%5%18%2%28% South 0%1%11%0% 38%8%15%1%26% South West1%0%22%0% 19%13%16%1%28% National9%1%16%10%7%14%7%14%1%21% Data Source: LSMS-ISA Nigeria, 2010-2011

23. Abt Associates | pg 23 Trade Impact  Domestic Trade –Some degree of price differentiation for quality from NGN 20-40 for drier maize free of insect attack and chaff, NGN 5 – NGN 25 for unspoiled good quality groundnuts. –Farmers incur some cost for basic sorting to respond to this price differentiation. –However, the differentiation is not because of aflatoxin or mycotoxins –Field research found no domestic testing and awareness of aflatoxins/mycotoxins for direct human consumption Therefore, given the current conditions, there is negligible, if any, domestic market impact of aflatoxin contamination.

24. Abt Associates | pg 24 Trade Impact in Groundnuts  Groundnut export since mid 1970s has been negligible  Decline in historical share of world exports as result of oil price shock and focus away from agriculture, plus aphid infestation  EU harmonization of aflatoxin standards was in 1998. Nigeria’s groundnut exports had declined significantly well before that Nigeria can gain from investing in improving groundnut production to compete in the international trade market as it has done through a 3-year collaboration with ICRISAT. However, aflatoxins are not the only reason Nigeria has not entered this market so far.

25. Abt Associates | pg 25 Trade Impact in Maize  Historically maize exports have been low.  Maize exports have often been banned--as they are now-- because of this crop’s importance for food security. Constraints other than aflatoxin contamination is limiting export of maize from Nigeria.

26. Abt Associates | pg 26 Health Impact  Health is arguably the largest area of impact of aflatoxin contamination in Nigeria  Conclusive evidence of health impact of aflatoxin is established for liver cancer – this is quantified and monetized in the country assessment.  Impact on stunting is still inconclusive, with only one article establishing the relationship between aflatoxin contamination and stunting

27. Abt Associates | pg 27 Estimating Health Impact Aflatoxin Contamination (ng/g) Aflatoxin Contamination (ng/g) Consumption (gram/day) Consumption (gram/day) Body Weight (kg) Body Weight (kg) Exposure to Aflatoxins (ng/kg-bw/day) Exposure to Aflatoxins (ng/kg-bw/day) Shares of HBV positive population Liver Cancer Cases (number/year) Liver Cancer Cases (number/year) Exposure to Aflatoxins (ng/kg-bw/day) Exposure to Aflatoxins (ng/kg-bw/day) Population (2010 projected) Population (2010 projected) Share of HBV positive population Cancer Potency for HBV Positive (0.3 per 100,000) Cancer Potency for HBV Positive (0.3 per 100,000) Cancer Potency for HBV Negative (0.01 per 100,000 ) Cancer Potency for HBV Negative (0.01 per 100,000 ) Sum of: Population Risk (Cancers/year/ 100,000

28. Abt Associates | pg 28 Health Impact RegionHCC Cases a DALYVSL (low)VSL (high) (cancers/ year) (in millions) b North Central3,69848,161$181$1,513 North East3,07539,987$151$1,258 North West2212,864$11$90 South East2583,375$13$105 South 1632,115$8$67 South West3464,462$17$142 National7,761100,965$380$3,174  7,761 out of estimated 10,130 liver cancer cases in 2010 can be attributed to aflatoxins.  Monetized impact ranges from 0.2% to 1.6% of GDP (in 2010 Nigeria GDP was $197 billion)

29. Abt Associates | pg 29 Sensitivity Analysis of Impacts Exhibit 6 ‑ 14: Estimated HCC Cases Attributable to Aflatoxin Contamination in Nigeria for Ranges of Aflatoxin Prevalence Levels and Ranges of Food Intake Levels AFB1 Level (ppb) Levels of Food Intake by Person Weighing 60kg (g/person(60kg)/day) 124 1 1050100150200400 111594693139185371 22301993185278371742 5576462324646959271,854 101,152934649271,3911,8543,709 202,3051859271,8542,7813,7097,417 10011,5249274,6369,27113,90718,54337,085 Notes: 1.Estimated Intake of Maize and Groundnuts in Nigeria (g/person(60kg)/day)  Estimated the impact with varying food intake, and varying contamination.  Even at 20 ppb the current consumption levels of maize implies that 2,305 out of 10,130 liver cancer cases (more than 20%) can be attributed to aflatoxins.  In another sensitivity analysis, we estimate that if HBV prevalence is reduced to zero, the total number of liver cancer cases attributed to aflatoxins would reduce 3-fold

30. Abt Associates | pg 30 Opportunities for Aflatoxin Control in Africa Institutional, Policy and Regulatory Environment  Set clear division of roles and responsibilities for greater regulatory efficiencies.  Set coordinated, risk-based surveillance strategy to communicate and isolate food system threats.  Regulate raw commodities destined for domestic consumption.  Set withdrawal procedures for contaminated samples and explore alternative uses.  Disseminate codes and standards regulating food commodities, processes, and enterprises.  Strengthen institutional mandate for cross-ministerial collaboration in shifting production and consumer demand for food quality. Step 5

31. Abt Associates | pg 31 Opportunities for Aflatoxin Control in Africa  Scale ppps to increase access to agricultural inputs and practices, e.g. scaling up targeted input voucher programs for the poorest farmers.  Use mobile phone and banking technologies to design business models for that serve the poor.  Use bio-controls such as the IITA-developed Aflasafe approach or natural fungicides to reduce aflatoxin levels in soil and among treated crops, even after poor storage.  Introduce post-harvest techniques (e.g. drying above ground, solar driers to reduce adverse conditions that favor growth  Introduce improved storage methods (e.g. hermetic storage to arrest development of the responsible Aspergillus species)  Use national data on agric stressors to target market-based solutions to address threats.  Use global aflatoxin research agenda to inform and complement domestic research, and vice versa Agriculture

32. Abt Associates | pg 32 Opportunities for Aflatoxin Control in Africa  Raise awareness of tolerances and SPS practices in foreign markets of interest, and improve the compliance of growers, shippers, exporters to assure compliance  Spearhead harmonized SPS policies within West Africa that tend to reduce the mycotoxin problem (both aflatoxins and fumonisins) while facilitating cross border trade  Explore alternative uses for contaminated crops that make sense for Nigeria, and adjust official standards accordingly  Use economic incentives (carrots and sticks) to shift behaviors in the supply chain while expanding farmer access to best aflatoxin control solutions  Encourage improved storage systems at all levels to reduce deterioration and loss: –Warehouse receipts programs –Commodities exchange board and marketing boards (if revived) to improve quality, condition, and safety of agrifood products destined for human consumption Trade

33. Abt Associates | pg 33 Opportunities for Aflatoxin Control in Africa  Joint campaigns between the Ministries of Health and Agriculture to raise consumer demand for GAP and safer food  Increase awareness of food safety and nutrition in the first 1,000 days  Encourage dietary diversity of non-susceptible plant and animal products  Use behavioral change communication to promote safe household and infant food preparation and feeding practices  Upgrade the food safety control system (e.g. policies and standards for mycotoxins/aflatoxins based on average daily intake, surveillance and testing methods, withdrawal/compensation procedures, penalties for infringements  Stay abreast of global research on aflatoxin and health/nutrition linkages and explore avenues for further research Nigeria  Increase universal access to the HBV vaccine. Health

34. Abt Associates | pg 34 Conclusion  Aflatoxins are carcinogens w/other health effects  Contamination can interfere with trade & commerce  Believed to impact all of Africa, including Nigeria  Cost of inaction is high, especially in human health  Range of solutions is broad, but resources scarce  Prioritization and customization is needed  Mitigation should be multi-sectoral and coordinated