Escaping from the rice trap – Punch
Nigeria has a most realistic chance of breaking free from the shackles of foreign rice imports by taking advantage of the current spiralling cost and government policy direction to advance the cause of self-sufficiency in local production. Nigerians have understandably been groaning from the weight of rapidly rising cost of the commodity that went from between N7,000 and N8,000 per 50-kilogramme bag barely two years ago to triple that amount today.
According to figures from the Ministry of Industry, Trade and Investment during the Olusegun Aganga tenure as minister, Nigeria spent N360 billion on rice imports annually before the government decided to curtail the unbridled imports two years ago. This translates to almost a billion naira a day, too much a price to pay by a country that has the capacity to produce rice, not only for local consumption, but also for export. With such high cost, especially in foreign exchange needs, continuing along this path would have been nothing short of a journey towards perdition.
But faced with the stark reality of an economy currently in dire straits, the government is doing everything within its power to cut down on its huge food import bills, especially that of rice which, over the years, has become a major staple in the country. But will Nigeria escape from the rice trap soon? The Central Bank of Nigeria says, 'By the end of 2017, Nigeria will not only meet our national demand, which is between six and seven tonnes per year, but we will exceed it and we will have rice to export to other countries.' Now, the country ranks second, next only to China, on the list of major rice importers, with consumption standing at between 5.5 million metric tonnes and six million metric tonnes annually, going by official figures. But with a ban on imports through the land borders, there is now a huge gap between demand and supply that has driven up prices alarmingly.
Naturally, the challenge now is for local farmers to fill the gap, and reports indicate encouraging responses. Addressing members of the Senate Committee on Agriculture and Rural Development, Audu Ogbeh, the Minister of Agriculture and Rural Development, told them in October to expect a fall in the prices of rice. 'By November when the full-scale harvests start, rice prices will fall,' Ogbeh said. Nigerians are, however, waiting expectantly for the predicted price tumble.
With Christmas - a major Christian festive season, when rice is usually in high demand - around the corner, some states are already making pronouncements to the effect that they can conveniently manage without imported rice. In Ebonyi State, renowned for the cultivation of the popular Abakaliki brand of rice, the Governor, Dave Umahi, has placed a ban on serving of imported rice at public occasions. 'The parboiling process of Abakaliki rice makes it durable, unlike the imported rice which does not undergo parboiling,' the governor said recently while trying to promote his state's homegrown rice.
In neighbouring Anambra, which recently played host to a Federal Government delegation, led by Ogbeh and the Central Bank of Nigeria Governor, Godwin Emefiele, the Commissioner for Agriculture, Afam Mbanefo, stated in Awka, the capital, that the state had attained self-sufficiency in rice production. 'Based on the calculation of our expected yield, we are expecting to realise over 336,000 metric tonnes of rice in 2016,' he said, which exceeds the 210,000 metric tonnes target the state had projected for the year.
Activities of rice farmers in Cross River State have also caught the attention of the CBN, which has promised to make credit available for massive rice farming there. The state Governor, Ben Ayade, said it would serve a dual purpose of food production and job creation.
Significantly, big-time players like Coscharis Farms and Dangote Farms Limited, noticing the potential in rice production, have moved in to invest heavily. While Coscharis is limiting its investment to Anambra, Dangote has spread its tentacles to Edo, Jigawa, Kebbi, Kwara and Niger states, where Africa's richest man, Aliko Dangote, promised a $1 billion worth of investment last year. Both are also promising to build rice mills, with Dangote targeting Kano and Coscharis, Anaku in Anambra State.
The massive interest in rice planting in the country has not come as a surprise. This is a country that had its foundation on agriculture before the discovery of oil and gas. Data from World Bank indicate that the country boasted 77.7 per cent arable land in 2013. Research and availability of rice varieties have also made it possible for rice to be grown across the length and breadth of the country, at any time of the year.
To achieve self-sufficiency, the government has a very important role to play. Apart from guaranteeing access to soft credit, it has to improve infrastructure, especially access roads to ensure that products are easily evacuated from the farms and waste is cut down. Besides, it is equally important to protect the nascent rice farming culture by making sure smugglers are not allowed to flood the market with cheap imported rice.
Already, there have been reports of massive imports by neighbouring countries, targeting the Christmas rush in Nigeria. They are planning to take advantage of the free trade treaty of ECOWAS, which guarantees free movement of locally produced goods among member countries, to bring in imported rice. Apart from hurting the rice farmers and, by extension, the Nigerian economy, allowing smugglers to have their way will deny government huge amounts of revenue in unpaid customs duties. This is certainly not what the country needs at this crucial stage. It is also believed that pressure is being mounted by countries such as Thailand, India and Singapore, the world's major rice producers, on Nigeria to ease the restriction on imported rice. While the Nigeria Customs Service should ensure that smugglers are shut out, the government also has to resist the pressure.
Although started as part of Goodluck Jonathan's Agriculture Transformation Agenda, the rice self-sufficiency programme has received a shot in the arm from the Muhammadu Buhari administration. While Jonathan's target of 2015 for self-sufficiency failed to materialise, it is hoped that, with steadfastness and an enabling environment for prospective investors, Nigeria's quest for producing enough rice for internal consumption and even for export in 2017 will be achievable.