Within a period of four months (June-September), the average cost of preparing a pot of Jollof rice; a popular Nigerian delicacy for a family of five, has risen by 7.6 percent, according to the latest Jollof Index report.
The report titled ‘Brace for Impact’ by SBM Intelligence, an Africa-focused geopolitical research and strategic communications consulting firm shows that the cost increased by 7.6 percent to N9, 917 in September from N9, 220 in June.
“The cost of rice has increased for several reasons. First, the naira keeps losing value against the dollar, thus increasing the cost of purchasing foreign rice, which most Nigerians consume,” the report stated.
It further stated that the scarcity of Foreign Exchange (FX) for food purchases through official sources also adds to the increased cost.
“More concerning information is that these prices will further increase as floods destroy large rice farmlands, which supplement the imported quantities,” it added.
Using the Jollof index, SBM illustrates how food prices have changed over time. The data gathered monthly from 13 markets spread across Nigeria’s six geopolitical zones is computed using the costs of the ingredients.
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The ingredients that make up the index are rice, groundnut oil, chicken or turkey, beef, seasoning, pepper, tomatoes, salt and onions. While the index has treaded close to food inflation since collection began in 2016, it has provided a simple way of communicating the realities of inflation to the Nigerian public.
Across the 13 markets, Wuse II in Abuja is the most expensive place to make Jollof rice at N13, 150, while at N8, 510 Onitsha, Anambra is the cheapest.
According to the National Bureau of Statistics, Nigeria’s food inflation rate accelerated for the seventh straight month in September to 23.34 percent, the highest in 17 years.
While this has been rising, other countries have recorded a decline in food prices as the global food price index dropped for the sixth consecutive month.
On Tuesday, BusinessDay reported that the floods have sent prices of food items like rice on an upward trajectory. For example, some markets surveyed in Lagos found that a 50kg bag of locally produced parboiled rice sells for an average of N35, 000 as against N28, 000 a month ago.
And a 50kg bag of foreign parboiled rice now sells for N43, 000 as against N31, 000 a month ago, indicating a 38.7 percent rise in price. Traders and distributors of the commodity have said that the price could go as high as N50, 000 before December
“With the rate the prices of rice are surging daily, we might even buy it at N50, 000 before December,” said Ronke Adewale, a rice trader at Daleko Market in Mushin.
Mohammed Abubakar, chairman of the Rice Processors Association of Nigeria, said the recent surge in the price of a bag of rice is a result of a combination of issues escalated by the floods.
“The flood has submerged hundreds of rice farmlands and has caused the price of paddy to jump from N200, 000 to N300, 000 per tonne. It has also worsened the diesel and transportation situation in the North,” Abubakar added.
Flood incidents in the country, the worst in a decade, have destroyed 70,566 hectares of farmland, damaged 45,249 houses and displaced over 1.4 million Nigerians, with about 600 persons reported dead.
The SBM report also highlighted that in Nasarawa state alone, $15 million worth of rice farms were submerged by floods, which means that there is no harvest for this season for most parts until the next planting season.
“The rice harvest, which is expected for November-December 2022, has been cut off, and Nigerians have to wait till the next rice harvest season, which is August-September 2023 for the South and November-December for the North.
“This means that in about one year, domestic production of rice will reduce considerably,” it stated.
In the face of current realities, analysts at SMB recommend FX should be made available for the importation of grains and encourage importers to do so.
“For other food items that still have a ban, the government should consider a temporary suspension of these bans to help Nigerians import the quantities they need and not create more scarcity,” it added.
