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Brent recovers slightly to $74.28pb but still below budget benchmark price of $77.96pb

Brent futures climbed by 1.31% today to $75.27pb after falling to a six-month low of $74.28pb yesterday (December 6). The price gain was buoyed by the 12.1% (1.21mbpd) increase in China’s crude imports in the first 11 months of the year. However, Brent crude price is still 4.72% below the 2024 budget benchmark price of $77.96pb, threatening fiscal consolidation. Meanwhile, for the first time this year, the oil market is trading in contango, with Brent prices selling higher in the futures market than in its spot market. This is likely to keep the price of Brent bullish in the near term.

The domestic price of corn (maize) doubles to N580,000/tonne

The global price of maize has tumbled to a 3-year low of $191.88/tonne, equivalent to approx. N235,000/tonne (using the parallel market exchange rate of N1,225/$) as production levels in the US and Brazil increased. However, the price of corn in Nigeria is more than 100% higher than the international price. This is because of restrictions on imports. It is expected that the price will fall sharply as smugglers take advantage of the arbitrage corridor. Another major reason for the price surge is the insecurity in the Middle Belt (Kaduna & Plateau), which is the maize-planting basket of Nigeria. If the insecurity situation is contained, we should witness a sharp fall in the price of maize products and its derivatives like pap, corn oil, etc.

These and other burning economic issues were discussed on the Business Morning programme on Channels TV by FDC’s Senior Analyst, Funmi Adebowale.

Click the link  to watch the video.

Enjoy your read!