Rice traders in Lagos have expressed concerns about the inability of local rice farmers to keep up with the growing demand for rice. In interviews with the News Agency of Nigeria (NAN) on January 10th, 2023 in Lagos, several traders discussed the challenges they face in the rice market. Recently, the Federal Government reaffirmed its commitment to boosting local production of key crops, including wheat, rice, maize, sorghum, and soybeans, by providing necessary farm inputs. Despite this commitment, some traders are grappling with the rising costs of rice and the insufficient supply from local farmers.
John Nwabueze, a foodstuff trader at Alimosho, highlighted the escalating cost of rice and the current limitations in meeting the surging demand for the staple crop. While acknowledging the improved quality of locally grown rice, Nwabueze suggested that the closure of borders could drive Nigerians to embrace locally produced rice, gradually leading to meeting the demands with local farmers over time. He pointed out that poor awareness of the benefits of local rice was a key reason why many Nigerians preferred foreign rice. Nwabueze emphasized that there are high-quality local rice brands available, without stones and well-polished, but consumers remain accustomed to foreign rice. He urged the government to either enforce the complete closure of borders to curb smuggled rice or officially open borders for legal rice imports.
Some traders explain the difficulties in accessing foreign rice.
Temitayo Abdulhakeem, another rice trader, echoed similar sentiments regarding the insufficient supply of locally grown rice to meet the growing demand. Although he acknowledged an improvement in the quality of Nigerian rice, Abdulhakeem expressed concerns about the ability of local farmers to meet demands without access to smuggled rice. Abdulhakeem noted that the initial closure of borders resulted in a surge in rice prices, emphasizing the limited number of high-quality Nigerian rice brands. He called for the opening of borders for legal rice imports, anticipating that it would lead to increased competition among importers, ultimately breaking the Monopoly held by a few.
The traders revealed that accessing foreign rice has become challenging recently. In the current market, a bag of short-grain rice is priced at ₦54,000, while long-grain rice sells between ₦65,000 to ₦66,000. On the other hand, Nigerian rice is priced between ₦49,000 to ₦50,000 per bag. The concerns raised by these traders underscore the delicate balance between supporting local farmers and ensuring a stable supply of rice to meet the demands of the Nigerian population. While the closure of borders may boost the consumption of locally grown rice, there are challenges in meeting the immediate demand without access to alternative sources.
Increased mechanization needed to boost rice production.
In Nigeria, rice stands as a crucial staple with a per capita consumption of 32kg, reflecting its significant role in the country’s food landscape. Over the past decade, rice consumption has risen sharply, reaching 6.4 million tonnes in 2017, representing about 20 percent of Africa’s total consumption. Despite the government’s prioritization of rice production, there is substantial untapped potential for increased productivity. Current yields remain at two tonnes per hectare, half of the average achieved in Asia, indicating room for improvement. The mechanization gap, with Nigeria’s rate at 0.3hp/ha compared to 2.6hp/ha in India and 8hp/ha in China, is a significant barrier. Addressing this gap by increasing the mechanization rate to 0.8hp/ha in the next five years could potentially double rice production to 7.2 million tonnes, but it would require a tripling of the current machinery stock.
Globally, rice production has grown steadily, particularly in Asia, where China and India are the leading producers. In Nigeria, however, the low mechanization rate, coupled with challenges like limited access to affordable financing and technical skills, hinders progress in the rice value chain. Bridging the mechanization gap presents an opportunity to not only boost production but also enhance yields, increase labor productivity, reduce post-harvest losses, generate higher income for farmers, and promote import substitution. To unlock this potential, the Nigerian government must create an enabling environment that fosters profitable mechanization. Key priorities include addressing land tenure and ownership challenges, investing in rural Infrastructure and extension services, and ensuring transparent and accessible incentives for all potential Investors in the agricultural value chain.
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As the government strives to enhance local production, there is a need for robust awareness campaigns to educate consumers about the benefits of consuming locally grown rice. Additionally, addressing the concerns of traders by enforcing border closures or implementing effective importation policies will be crucial in shaping the future of Nigeria’s rice trade. The challenges faced by rice traders in Lagos highlight the complexities of the rice market in Nigeria. Balancing the promotion of local production with the immediate demands of consumers requires a strategic and well-thought-out approach from both the government and the stakeholders in the rice industry.