Despite the challenges which rice farmers have experienced this year, ranging from border closure, global lockdown due to the COVID-19 pandemic, and flood, among others, there is a continuously high demand for local rice. JULIANA AGBO examines the efforts of stakeholders in the rice value chain to make the product available, accessible and affordable.
Before the Federal Government showed more commitment to diversification of the economy through agriculture, especially in the area of rice production, Nigeria spends about $372 million annually on the importation of rice to make up for the shortfall in production. Then, rice was said to be cultivated on about 3.7 million hectares of land, representing approximately 10.6 per cent of the 35 million hectares of land under cultivation, out of a total arable land area of 70 million hectares in Nigeria.
According to statistics from the Rice Farmers’ Association of Nigeria (RIFAN) in 2019, Nigeria currently consumes about 7.9 million metric tons of rice annually while production is at eight million metric tons.
Despite the increase in production of rice, there is a huge gap between the demand and supply of the commodity.
While farmers fear that if this gap between domestic supply and demand keeps expanding, rice will no longer be affordable or available to most Nigerians.
With the current commitment toward promoting and ensuring food security in Nigeria, Nigerians are of the opinion that this is an opportunity to empower the rural farmers to boost rice production which will aid the distribution and expansion of the supply chain in Nigeria.
The continuous increase in the demand for rice is an opportunity for investors and farmers to go into rice production since increased production of the commodity will improve the economy in many areas.
While Nigeria’s quest for self-sufficiency in rice production is fraught with issues about quality, price instability, and harvesting/processing challenges, among others, the National President RIFAN, Aminu Goronyo has assured that Nigerians should expect between nine and 11 million metric tons of rice this year.
Goronyo said the increase in the price of rice is associated with dollar appreciation against the naira as producers and processors convert naira to buy the input and other equipment.
He said plans are on to make rice available, accessible and affordable.
“We are still expecting between nine and 11 million metric tons of rice this year. Nigerians should not panic because, in the next few weeks, the prices of rice will reduce from what it is now. The Central Bank of Nigeria (CBN) has done its best for us by making farming easy for farmers. We have begun harvesting. Between now and four weeks, the prices of milled rice will reduce,” he said.
Vice-President RIFAN North West, Mohammed Auwal, said plans are on to start the dry season farming so as to compensate for whatever that is happening in any location and take care of all the losses during the year.
Auwal, who noted that RIFAN has been consulting with the government, said the second cropping season will begin immediately by the end of this month, after the first season harvest so that there won’t be a difference in output.
He said: “Despite the issue of banditry, there was a massive production of rice, people have planted en masse. Every little space that can produce rice has been cultivated; so that will compensate for whatever that is happening in any location, so in terms of the output, there won’t be any difference.
“We have been consulting with the government; we have plans in place. Instead of doing one dry season, we are going to do two dry seasons this year. So, we are going to have two cropping seasons within the dry season.
“The first cropping season will come by the end of this month, then we harvest in January, and in February, we plant again, we will harvest in June, by then, the rains have begun when we will plant again.
Furthermore, Vice-Chairman RIFAN South West, Victor Korede, who noted that despite that the farmers couldn’t access inputs on time due to the lockdown and issues with logistics, he said rice production in the South West is in progress.
He said: “A lot of our farmers recorded losses because South West was affected by drought instead of a flood. We remained undaunted and we replanted.
An Assistant Director with the CBN and member of the Rice Value Team, Dr Musa Olasupo, who explained that prices are actually controlled by demand and supply said rice was selling at a cheap rate when the market was flooded with imported rice, adding that it affected the country’s import bills which amounted to about $372 million.
Olasupo added that the CBN is encouraging producers to mill rice in those zones where there are no milling facilities so that the cost of transport logistics and the premium that is being given by distributors will be reduced to the nearest minimum.
“If you are picking price in isolation because of a particular region, then you don’t have a true reflection of what is the price of a 50kg bag of rice in states where we have a peak of production. We have these exceptions in the South where we don’t have mills and the challenge has been more of logistics.
“Kano State, for example, has the largest milling capacity in Nigeria. The cost of a 50kg bag of rice in the farm gate or factory gate is about N16, 000 while they get it in the market about N17, 000 and that explains all.
“As at now, 100kg bag of paddy is between N130, 000 and N140, 000. So, the inefficiency is an arbitrage that is being put there by distributors and those involved in logistics. It is when we are able to have efficiency along the value chain that we can have fair pricing across the entire zone, and we can have a standard price of rice nationwide,” he said.
Assuring that Lagos State’s milling capacity is about 80 per cent completion, he said the CBN will go beyond encouraging paddy production for the country to attain self-sufficiency in rice production.
He explained: “We also will require bigger mills because we have smaller mills in the South. There is a mill in Delta State; it is doing about 20 to 25 metric tons per hectare. Consumption in Delta, Benin, Rivers, and Beyalsa will be going to about 200 million metric tons. So, we need to bring in this efficiency by encouraging more people to mill beyond paddy production.
“We will have millers that will be able to deliver rice at affordable prices. We started this in 2015. Any country that has been able to attain self-sufficiency in rice production went through this path. Once we are able to produce more, the price will continually come down until it attains an equilibrium position.
“The cost of production is more of physical issues. Even if we fix the cost of paddy, fueling, labour and cost of bagging, it will continue to increase and it means the final price the consumer will pay will increase.
“This is a journey for everyone. The government is trying to increase power supply. If that comes up, it means the cost of diesel will reduce and the price of rice will finally reduce. A lot of things come into the pricing mechanism. We are trying to fix a part of it. Some other parts will also need to be fixed. That is why in 2019 we went into a collaboration to ensure that every stakeholder in this value chain comes to the realisation that we need to do more to attain self-sufficiency in rice production.
Hope for flood victims
While explaining that there are mitigants for almost every risk and pro-actively, Olasupo said the CBN has done all for the farmers to thrive after the flood incidence.
He said: “For those farmers, they have their farms covered in the area of yield index insurance scheme. What this indicates is that if there are eventualities, the insurer will be able to pay back farmers what they expect to be the yield from that farm.
“Now, we have them on the field where they are engaging the farmers. We are trying to bring the farmers back to cultivate during this dry season so that they don’t lose out thereby by getting discouraged.
He, however, assured that finance will not be a challenge for farmers who will help in diversifying the economy.