President Muhammadu Buhari in his 2018 New Year’s Day address said that importation of rice will be completely stopped this year to encourage local production, a sentiment which on the surface appears to be good news for the local economy, but in reality, fraught with inadequate knowledge of current realities.
Rice importation through the ports have been technically banned since 2015 as a discouraging 70 percent tariff more or less effectively dissuaded importation through the ports, while it remained totally banned through the land borders.
The reality as BusinessDay findings show is that, as legal importation to Nigeria drops drastically, neighbouring countries such as Benin, Cameroun, Niger and others have seen their parboiled rice imports increasing. Ironically, these countries mostly consume Jasmine rice (another variant of the staple), whereas they import more parboiled rice, which in consideration of their population can last them for a decade, yet their imports continue every year. But for Nigeria, legal imports are on the decline as smuggling increases exponentially.
Data provided to BusinessDay by a source preferring anonymity, showed that Benin republic with an estimated population of 11 million people, imported 609,893 metric tonnes of parboiled rice from India in 2017, while Niger, with an estimated population of 21 million people, imported 98,179 metric tonnes, and curiously, Nigeria, with a population of 186 million imported 8,726 metric tonnes.
Also, data by the Thai Rice Exporters Association shows that Benin Republic’s imports from Thailand from January to November 2017 stood at 1.64 million metric tonnes, a 32 percent increase from 1.24 million metric tonnes within the same period in 2016, and an increment of 104.45 percent from 805,765 metric tonnes exported to Benin republic in 2015. Cameroun also imported 663, 667 metric tonnes of parboiled rice from Thailand between January and November 2017, a 47.64 percent increase from 449, 513 within the same period in 2016, and 449, 297 metric tonnes in 2015.
“Rice has been on technical ban before,” said Tunji Owoeye, managing director, Elephant Group Plc, who was previously the chairman of Nigeria’s rice importers association. “This is not new and has been part of the medium term plan. And in any case, since the inauguration of this administration, there haven’t been rice imports.”
Ade Adefeko, vice president, Olam, told BusinessDay smuggling remains the major challenge for local production of rice in Nigeria, and according to him “even though the government has been trying its best to curb smuggling, more efforts are still required.”
Major industry players believe that smuggling remains the challenge in Nigeria’s quest for sufficiency in rice production, but many do not wish to out rightly contradict the president’s hopes that sufficiency can be achieved this year, expressing belief that more positive results are still achievable.
In the views of Africanfarmer Mogaji, CEO, X-Ray Farms, the total ban on rice importation “is not achievable. We are not producing enough and we are heavy consumers. If you are going to ban something then you should be producing over 100 per cent of what you need, and as long as we are not producing enough of what we need, importation is inevitable (albeit through smuggling).”
“If we will be self-efficient in 2018, we should have felt the effect in November/December 2017,” Mogaji said.
David John DaDa, head, Out-growers Unit at WACOT rice mill, also said in a phone interview, that “The president did not tell us the measures he has put in place to achieve this (total ban on importation) because, the Anchor Borrowers’ Programme is not fully deployed by the government and it cannot help to stop importation as it is not reaching many bona fide farmers.”
He also noted that imported rice remains cheaper than the locally produced ones, hence, being at a disadvantage.
On the more optimistic side, Owoeye, who also currently chairs the Rice Investors Group, believes restrictions on importation have “some positive impacts because it is making value chain operators to look inwards and ramp up production. Maintaining the tempo of paddy production, and expanding milling capacity also needs to be stepped for Nigeria’s aspirations to be met. But, what we need Government to do is to enforce restrictions at the borders to ensure that all the smuggled rice no longer come in.”
However, like other stakeholders, Owoeye reiterates that “the major issue is still smuggling. If the issue of smuggling is not dealt with, it will set back the whole achievements (in ramping up rice production).”
CALEB OJEWALE & BUNMI BAILEY
