Christmas in Nigeria: Rice Price Surpasses Minimum Wage, Sending Bleak Festivities
Published on: December 5, 2023.
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The tradition of companies giving out bags of rice as gifts to their workers, friends, and customers is fading away in Nigeria due to various challenges. The country is currently experiencing a deficit of 2.2 million tonnes of rice, valued at N1.1 trillion. This shortage has resulted in high prices, with a bag of rice currently being sold between N45,000 and N52,000 in the market. As a result, many companies have ruled out giving rice as gifts this year.
One of the main challenges is the increase in rice consumption, which has risen by 6% from 7.15 million to 7.6 million tonnes, while production has only increased by 3% from 5.2 million to 5.36 million tonnes. This has led to a significant shortage of rice in the market. Additionally, the popular Lake Rice, produced jointly by Lagos State and Kebbi Governments, has disappeared from the market.
Rice merchants in Lagos have also expressed their complaints about the current situation. The cost of bringing rice to the market has increased by about 300% due to the high price of fuel for transportation. Previously, rice merchants could sell between 80 and 100 bags of rice in a month, when the price was between N22,000 and N28,000 per bag. However, now it is difficult to sell even 10 bags in a month due to the high prices and the general economic situation in the country.
The ban on rice importation by the Federal Government was intended to encourage local production. However, flood and the activities of bandits have hindered this initiative. Over the past eight years, most of the rice needed to meet local consumption has been smuggled from Benin and Togo. This has resulted in a loss of foreign exchange and significant spending on rice imports.
Some rice merchants have even relocated to Benin, where they can enjoy lower import tariffs to ship rice from major importers. Benin does not consume parboiled rice, and the majority of the imports are destined for the Nigerian market. Large volumes of rice are shipped from Thailand, Pakistan, India, the United States, and Vietnam to Benin for transshipment to Nigeria.
The Central Bank of Nigeria (CBN) has focused on supporting local rice production through its anchor borrower scheme. The CBN has imposed a ban on rice imports and has supported companies that produce urea, the main raw material for fertilizer production. This has led to a significant increase in the number of integrated rice processing facilities in Nigeria.
Unfortunately, floods have also been a major setback for rice production in Nigeria. Thousands of hectares of rice farms in various states in the northern part of the country have been destroyed by flooding in the last two years. This has had a devastating impact on rice farmers and has further contributed to the shortage of rice in the market.
Despite these challenges, the Nigerian government remains committed to promoting local rice production and reducing dependence on imports. The efforts of the CBN and the increase in integrated rice processing facilities in the country are positive steps towards achieving this goal.
Source: [New Telegraph NG](https://newtelegraphng.com)
