The United States Department of Agriculture (USDA) report on Nigeria’s rice import may have been false, but it is unlikely locally produced rice will be available for most Nigerians to consume during this festive season.
Earlier this year, ‘Foreign rice’ was sold cheaper; in the N12,000 to N14,000 range whereas locally produced rice averaged N17,000. The price of locally produced rice has hardly reduced in the last two years, despite the gradual drop in costs of paddy rice, which is essentially the raw material.
Senior executives at rice milling companies had lamented at different times when interviewed, that the cost of paddy rice needed to drop in order for the cost of local rice to equally reduce. This, however, does not appear to be the reality.
From N13,000 two years ago, a jute bag of paddy rice with an average weight of 75kg now sells for N7,500 on the average; approximately N100 per kg. A recent visit to Lafiagi, a rice producing area of Kwara state, showed this as the current market price, which rice milling companies use in making their purchase from aggregators.
Muhammed Augie, chairman, Rice Farmers Association of Nigeria, Kebbi State chapter, had also recently said paddy rice costs about N8,000 per bag. The drop in price from N13,000 in 2016 to an average of N7,500 at present, represents a 42 percent drop in cost of paddy rice. Last year, paddy was sold at an average cost of N11,000 per bag and has been gradually reducing until it got to the present price.
However, the drastic drop in cost of paddy rice over time has not reflected in the cost of locally produced rice, which has reduced by at most, 10 percent in price.
Despite repeated assurances by the Buhari led administration, that from the end of this year, locally produced rice will be available for consumption by “all Nigerians”, the reality is not quite the same. Nigerian markets remain largely flooded with foreign rice, which for emphasis is not imported, but smuggled.
Even though export data from Thailand, India and other countries that previously exported rice to Nigeria show volumes have declined by over 90 percent, smuggled ‘foreign rice’ is what many in the south still find in the markets.
The smuggled rice which used to be much cheaper than locally produced rice, is now almost at par in cost, yet still enjoys patronage. A survey of major markets particularly in Lagos and Rivers States, showed the ‘foreign rice’ dominate the markets.
“If you find one local rice displayed, you will find 20 brands of foreign rice on that display as well,” Ajayi Adekunle, manager, Double Door Limited, whose company has been in the rice business for years, first as an importer, and now, a distributor of locally produced rice, told Agribusiness Insight.
At the Mile 1 market in Portharcourt, Mario, Tomato, Abiba, and Caprice which are brands of ‘foreign rice’, sold for N18700 or N19000. The locally produced rice found at the time of the market survey were Mama’s choice with a 50kg bag selling for N15,500 or N16,000 and Mama’s pride, which was sold for N16,500 or N17000. Other brands of Nigerian rice sold for an average of N15,000 per 50kg bag.
The ‘foreign rice’ which used to be cheaper now appears either more expensive or at par with the local rice depending on the market. As Amaka Nwachukwu, a Portharcourt resident described it, “the price is increased by sellers because it is foreign and they know people buy it more than Nigeria rice.”
At the Daleko market in Lagos, brands of imported rice such as Caprice, Royal Stallion and others ranged between N15,000 and N16,500 for a 50kg bag. Available brands of local rice included Mama’s choice and Mama’s pride sold for N16,500 per 50kg bag, Ahuoma rice, a brand sellers said is made in Abakaliki was sold for N16,500, while African princess, a brand of Ghanaian rice was sold for N15,000; even cheaper than most Nigerian brands of rice.
A major question remains why local rice is not only cheaper but readily available like the foreign rice. Rice millers in the country are unanimous, more or less, in the assertion that cost of production makes it less feasible for the cost of locally produced rice to be as low as the foreign rice. However, the euphoria surrounding increasing production volumes of local rice makes the situation (with high production costs) rather puzzling. With the Central Bank of Nigeria led intervention through the Anchor Borrowers’ Programme, and Federal Government’s campaign, the volume of rice production ought to have become more noticeable across markets in the country. While the cost of paddy rice appears to be coming down, and may have contributed to marginal decrease in price of some local brands of rice, the reduction however does not seem enough, at least, not in comparison to the foreign alternatives.
While Adekunle explained that people want the local rice, he says it is not readily available in the markets. Since February, he has ordered for four trucks of Lake rice, which should contain 2,400 bags, but it is yet to be delivered. In Lagos, Lake rice, which is promoted (and subsidized) by the state government is perhaps the most popular brand of local rice. In a phone interview this week, he said the rice may not be available as cheap as N12,000 which it was sold in the past.
Even as he has not taken delivery of his order or gotten a refund, Adekunle says he has now been told he would have to pay some additional money before taking delivery of his rice shipment after waiting for 10 months.
“The smuggled rice across the border is what Lagosians eat more. In fact, lake rice is not enough to take care of the people in Lagos state (alone),” said Adekunle.
CALEB OJEWALE
