Q4’24: Nigerians To Pay N1.95trn On Rice Importation

Despite the suspension of 110 per cent import tariff by the Federal Government, Nigerian merchants are to pay (N1.95 trillion) $1.3 billion to ferry 2.2 million tonnes of rice between August and December 2024.

The increase in importation of rice is largely due to Federal Government’s failure with regard to agriculture where it has spent billions of naira through various interventions with no result.

According to records, import duty on the grain was increased from 50 per cent in 2012 to 110 per cent in January 2013 to discourage importation of the grain and encourage local production, which was only three million tonnes as at 2012.

However, it was learnt that global rice shortage had worsen exports of premium varieties due to a surge in freight costs, foreign exchange and series of attacks on commercial ships by Iran-backed Houthi militants since the January 2024.

Besides freight cost, it was also revealed by the Thai Rice Exporters Association (TREA)that the price of parboiled rice has been increased from $501 per tonne to $593 per tonne in July 31, 2024.

Findings revealed that domestic production had slumped by 37.4 per cent or 3.1 million tonnes from 8.3 million tonnes to 5.2 million tonnes within two years because of the activities of bandits in the country.

According to rice miller’s, there is no enough paddy rice in Nigeria for the production in commercial quantities as they attributed it to the withdrawal of services at the farms by farmers due to insecurity.

As a result of this, Deputy Chairman of All Farmers Association of Nigeria (AFAN), Mr Shakin Agbayewa, noted that local rice production could only meet 57 per cent of the 6.5 million tonnes consumption.

He noted that rice sellers were repackaging local rice into foreign bags to sell at a higher price, adding that a situation where home based rice is repacked as foreign was not good for the country.

Also, the Lagos State Chairman, Rice Farmers Association of Nigeria (RIFAN), Raphael Hunsa, stressed the need to boost local rice production, saying the country needed more people in rice production.

Hunsa said: “We need to encourage more people, especially youths, to be engaged in rice cultivation. Presently, local rice is not available to meet the growing demands.

The Lagos State rice mill at Imota, which can produce 33,000 metric tonnes of rice per hour, is set up for the benefit of Lagos residents. “However, as we speak, the mill does not have enough rice paddy to kick off operations.

“Whereas the rice farmers in Lagos State need support to cultivate rice without dependence on outside state sources, we need increased support to also attract more rice farmers into the sector and to encourage existing farmers,” he said.

The chairman added that the Lagos State Government sourced paddy for rice mills in Kebbi, Kaduna and other northern states. Presently, 50kg of foreign rice, long grains, sells at N76,000 per bag, while short grain, depending on the quality, is sold between N75,000 and N80,000.

A bag of 50kg foreign rice was sold for between N45,000 and N60,000 as of November and December 2023. Rice was part of the items previously restricted by the Central Bank of Nigeria (CBN) from accessing foreign exchange at the official window, however, because of the new federal Government’s decision to suspend import duty on the grain, importers, who have ordered for 2.2 million tonnes can now bring the cargo to the country.

Meanwhile, the Federal Government had created centres across the country where Nigerians could purchase a 50kg bag of rice for N40,000.

According to the Minister of Information and National Orientation, Mohammed Idris, this is one of several initiatives by the President Bola Ahmed Tinubu’s administration to ease living conditions for citizens.

The minister added: “For example, at the last Federal Executive Council meeting, we announced that 20 trucks had been given to each state governor for onward distribution to those who actually needed them to the poorest of the poor in society.

“Rice is also being sold at about 50 per cent of its cost. This rice has been taken to various centres across all the states of the federation and is being sold at N40,000.”