By Jimoh Babatunde & Gabriel Ewepu

John Osagie, a driver  with a blue chip company in Lagos, was in a jubilative mood when he learnt that President Muhammed Buhari has approved the immediate reopening of four of the nation’s major land borders.

His joy is based on the fact that the price of rice will come down as he claimed that the price of local rice is going beyond the reach of the average Nigerian.

Unknown to him and others who are jubilating that the borders have been reopened is that the ban on the importation of rice, poultry and others was not lifted.

Osagie, just like many other urban Nigerians with preferences for imported rice, has continued to encourage the smuggling of foreign rice into the country  because of the perceived low quality of locally produced rice and high price.

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Many will not agree  that local rice is expensive due to the cost intensive nature of the processes and that the price link to the closure of the boarder.

The country before now is known as a net importer of rice, spending billions of naira on importation, which adversely affected local production, but wanting to turn around the narratives, the government through the Central Bank of Nigeria came up with the Anchor Borrowers Programme.

The Anchor Borrowers Programme (ABP) was initiated to create a linkage between anchor companies involved in the processing and small holder farmers (SHFs) of the required key agricultural commodities like rice.

The thrust of the ABP is provision of farm inputs in kind and cash to small holder farmers to boost production of these commodities, stabilize inputs supply to agro-processors and address the country’s negative balance of payments on food.

Experts’ position

As the availability and affordability of rice in the country has continued to dominate national discourse, experts have continued to air their positions  on the issue.

Hoarders responsible for high price of rice — Ijewere

Speaking on the issue, the Vice President, Nigeria Agribusiness Group, NABG, Emmanuel Ijewere, said, “To assume that when borders were closed rice was not coming in but now that the borders are opened rice will be coming in, that is not true. Whatever was coming in before the borders were closed especially in terms of rice and chicken were, still coming in.

“The psychology of people is that the borders were closed and that is why those who do the selling and those who consume led to people hoarding rice. So the price of rice is still artificial because I know the actual landing price of rice in Lagos is somewhere around N10, 000 and N11, 000.

“It is true that some people were affected by the paddy field that were flooded but the fact that it did not have any significant effect, and even now it will not have because by the time the flood came most of the main processing companies have already put in their warehouses the paddy rice that they need to mill for this Christmas season, so those rice that were lost are the ones likely to be sold next year.

“The high  price is artificial and Nigerians should not panic and start asking that rice  be imported because local farmers are capable.  These are people making it difficult for them. A few people have so much money in their hand rather than either putting it in the bank or buying Treasury Bills which are so low now, they are using the money to buy rice and hoard, thereby making it expensive.

“First of all many of those hoarding rice will lose. We should encourage the farmers to produce and the price of rice will crash. The cost of maintaining and preserving the rice in the various warehouses where it is being hoarded is high because the rice will deteriorate, and they do not have what it takes to do so. Hence, government should not panic at all at that, and nothing emergency should be done. Instead, people should not buy more rice than they need, people should not in their individual homes hoard rice.

“Once the normal buying takes place also the selling will take place and after some time things will find their level. So farmers are now producing more and more, more and more rice shipments are coming into the country, and so no need to panic.

“In 2021, the price of rice will crash, and I believe it will because of what government has put in place. The CBN initiative is very profiting and it will encourage the production of rice mills. Although, we have problem with the value chain because of transportation and others but that is not the real reason we are having this problem. This problem is purely an artificial problem.”

‘CBN created enabling ennvironment’

A rice farmer, Segun Athoh, agreed that what government has put in place through the CBN has created enabling environment for rice production and self sufficiency.

Athoh said: “Nigeria produces about six million metric tonnes of rice yearly and we cannot consume more than three to five million metric tonnes of rice in a year. Before now we were producing about 3.5million metric tonnes and that shows we have excess of rice in the country.”

Athoh says saboteurs are at work trying to create artificial scarcity by increasing the price of local rice in the country, stating: “I was at the Lagos Food fair weekend where a 50kg bag of local rice was sold for N20,000. Also the price crisis we have today are created by traders and smugglers. I can tell you for sure that most of the so called foreign rice in the markets are local rice re-bagged by the traders because they know Nigerians like foreign rice.”

Segun Athoh said the Governor of Central Bank, Godwin Emefiele, should be commended for what they have done for rice farmers. He said a recent market survey showed that local rice is more affordable than the foreign smuggled rice.

A recently-conducted survey  showed that the prices of stoned and de-stoned local rice and tomatoes dropped when compared with October prices.

A trader, Okwu said “Many rice dealers, especially farmers flooded the market with rice, so we are forced to reduce the prices.”

Mr. Uche Ojo, a rice dealer at Agege, said although the prices of local rice dropped, the price of foreign rice has continued to soar.

Based on the available statistics that smugglers are trying to create artificial scarcity of local rice through their activities, the National President, Rice Millers Association of Nigeria, RIMAN, Peter Dama, said: “RIMAN is worried but we are happy that government still banned the importation of rice into the country.

We are happy foreign rice still banned — RIMAN

“We call on government to ensure that imported rice into the country should come only through the sea ports. We also call on government to increase the tariff of imported rice.

“Also efforts should be made to ensure that Nigerian boarders are well manned. The security agencies at the Nigerian boarders especially members of the Nigerian Customs Service should be well equipped to ensure proper monitoring of our borders.

“Any of them found

compromising should be prosecuted. Drones should be utilized to monitor the porous borders particularly the illegal entry routes.”

However RIMAN is of the opinion that the opened borders will bring serious challenge to them as such they also have to further improve on the quality of their products in order to be competitive in the market against foreign imported rice.

Dama said: “Government will also need to subsidize the farmers and rice millers just like what foreign countries do to their farmers and millers. These incentives and inputs should be given to the farmers and millers as and when due in order to meet up with demand and supply.

‘Govt should improve infrastructure’

A miller, Musa Baba said: “Infrastructure should be improved including electricity and road transportation so that production will be increased to meet up with demands in the market.

“Paddy which is the basic raw material for rice milling must be made cheaper for millers to have enough raw materials for rice milling. At the moment rice Paddy is very expensive, thus one of the reasons for high cost of locally milled rice in the market.”

Baba also said that between 2015 and 2017, one could transport a  truck of rice from Kebbi to Lagos for about N150,000 but now it is about N300,000.

A miller in Ebonyi State, Iffy Ogwu, said that providing millers with interest-free loans and simplifying the administrative procedures for access to credit would help millers to maintain their activity, in particular by supporting paddy production.

The President, Association of Outsourcing Professionals of Nigeria, AOPN, Dr Madu Obiora, said, “The poor logistics infrastructure is responsible for the high cost of doing practically every business in Nigeria. Logistics impacts on agriculture, manufacturing and even services.

“The solution lies in strong institutions like Customs. We are signing to be part of the AfCFTA and the decadence in our system is responsible for what we are going through.

“We are fond of throwing money at projects without looking at all the angles. We need to look at warehousing for our agri-commodities and also transportation. After farming, the bulk of the costs lie in these two logistics components. There also has to be a distribution strategy to move the produce from area of production to areas of consumption. Always taking a holistic approach is the way to go.

“We also need to evaluate productivity of our rice production by looking at the yield per hectare and comparing with other rice producing nations that are competing with us in the rice market.”

The Founder and Chief Executive Officer of Farmfunded, Ajisope Joshua, said, “Intervention is not getting down to the people that need them. Paddy rice is expensive at the moment, a tonne of rice is selling at N190,000+ which is making the prices to go up.

“The drive for self-sufficiency can be achieved together by all the players in the agricultural/food space.”

Dama also noted that: “The issue of security in the country has to be addressed because farmers are scared of going to the farms for cultivation for fear of being attacked or kidnapped. Generally however RIMAN appreciates that Nigeria is a signatory to various international trade protocols that does not allow boarder closures.

“Our government should not allow its investments and those of individuals to be destroyed by allowing the country to become a dumping ground for all manner of goods that will destroy our achievement in the rice value chain sector. We therefore employ the government to do its best to protect what the nation can produce to feed the nation.”