How Local Millers’ Revelation Unravels FG’s False Claim On Rice Production

Like a balloon pierced with a needle, rice farmers and millers have punctured the official line touted by President Muhammadu Buhari as his government’s signature achievement in agriculture and food security.

“We have stopped spending our foreign reserve to import rice; there is sufficiency in rice and we now produce it locally, including the Anambra rice” was the President’s claim at a campaign rally in Onitsha on January 24. In fact, it has been his refrain in virtually every stop.

“The unprecedented flooding of the nation’s major markets with smuggled imported rice is of great concern to investors in rice, Agro companies and farmers in spite of government’s ban on the products.

“We highlighted at the stakeholders meeting we just-concluded now, that almost all the varieties of rice in the market presently are foreign and they come through the land borders,” Mr. Babatunde Ajibola, Head, Media and Communications, Elephant Group Plc, said in Lagos on Friday in an interview with the News Agency of Nigeria (NAN) at the end of a stakeholders meeting.

He said massive rice smuggling into the country was killing investments, threatening the confidence and ability of local rice millers and farmers.

It was a stinging rebuttal of a story the ruling party had sewer into its efficient propaganda machine that regularly regaled Nigerians of the existence of 12 million farmers that now produce up 97 percent of the rice consumed annually.

The government’s only proof to its claim is the zero allocation of foreign exchange for rice importation. Earlier in 2016, the Central Bank of Nigeria (CBN) had placed a ban on access to official allocation of forex to traders engaged in rice importation. As the ban took effect while rice continued to be available in local markets, the federal government interpreted it as proof locally produced had taken over the market.\

Ajibola said a visit to major rice markets, such as Iddo, Daleko, Ketu, Mile 12, Alaba and Sango-Ota, revealed that the various brands on display were imported with few or no local ones.

“This is happening in spite of the fact that the importation of the product by land is prohibited. Smuggling of foreign rice into the country has become a big business which calls for a serious attention,” he said.

He warned that unless concerted measures are taken to curb smuggling of foreign rice, local producers and millers may be forced to close shop. “The influx of smuggled rice has rendered local rice milling companies and farmers inactive as the local rice produced are not patronised due to difference in their prices. “This of course, does not encourage local production or help in boosting investors’ confidence in the rice industry.”

Ajibola noted that rice smuggling into the country would soon translate into massive job loss for Nigerians working in the local rice production companies and called on the Federal Government to put a stop to the massive smuggling of rice into country if its quest to encourage local production would be realised.

The rice farmers’ revelation bolsters a report by the United States Department of Agriculture in its World Markets and Trade Report October 2018 where it unequivocally stated that contrary to the federal government’s claim that local rice production now accounts for up to 95 percent consumption in Nigeria, more than three million metric tonnes of rice had been imported into Nigeria by September even with three months left before the end of 2018. The report further stated that since 2016, Nigeria had consistently imported 3,780,000 metric tonnes annually which is a reduction from 3,941,000 metric tonnes recorded in 2015. Again, contrary to claims by the government, Nigeria’s local rice production dropped from 2016 to 2018 compared to the situation in 2015.

Mr. Godwin Emefiele, CBN governor, had led the chorus on local rice production. “Available data has shown that in 2014, Nigeria imported 1.2 million metric tonnes of rice, in 2015 it had dropped to 644,000 metric tonnes and 2016, to 58,000 metric tonnes, 23,000 metric tonnes in 2017 and 6,000 metric tonnes in 2018,” Emefiele, said at the end of the first Monetary Policy Committee meeting for 2019.

After the federal government restricted access to foreign exchange for rice importation in a bid to prop up local production, foreign rice imports by neighbouring Benin Republic, Niger and Cameroon from Thailand have spiked astronomically.

According to data from the Thai Rice Exporters Association, rice export from Thailand to Benin Republic rose from 805,765 metric tonnes (MT) in 2015, when Nigeria introduced the policy to 1,427,098 MT in 2016. It further rose to 1,814,014MT in 2017, while importation from January to May 2018 has hit 625,863 MT in first five months of the year. Cameroon also experienced an upsurge in importation from 449,297 MT in 2015 to 502,254 MT in 2016, and 749,008 MT in 2017. The central African country bordering Nigeria has recorded 185,707 MT of imported rice from Thailand from January to May 2018. Similarly, the importation of foreign parboiled rice by Togo increased from 54,086 MT in 2016 to 132,978MT in 2017 and currently stood at 100,996 as at May 2018. In effect, while rice vessels calling at Nigerian ports have continue to decrease, neighbouring countries continue to experience increase in rice vessel traffic.

Statistics showed that since 2014 when importation of parboiled rice into Nigeria decreased from 1,239,810 MT to 644,131 MT in 2015, it was continued on a downward spiral as importation through neighbouring countries surged. It further decreased to 58,260 MT in 2016 to 23,192 MT in 2017, and January to May statistics showed that Nigeria has imported a paltry 2,351MT in 2018.

Apart from massive smuggling of the product through Nigeria’s immediate neighbours with hostile tariff regimes and economic policies, rice is still been brought in illegally through the seaports. The product is shipped in containers and falsely declared as other low import duty paying items, especially Plaster of Paris (POP). All it takes for the containers to illegally leave the port is “right understanding” between the importers and officials of the Nigeria Customs Service and other agencies involved in the Comprehensive Import Supervision Scheme (CISS).

The Nigeria Customs Service (NCS) seized over 497,279 bags of imported rice between 2015 and August 2017 with a Duty Paid Value (DPV) of N3.8 billion.