The Federal Government’s 150-day duty-free window to allow the importation of husked brown rice as part of measures to combat rising food inflation could bring down rice prices in next two months.
This follows efforts by rice processors to key into the grace period to import paddy as Nigerians confront rising food prices including that of rice.
The Special Adviser to Lagos State Governor on Agriculture, Dr Oluwarotimi Fashola expressed optimism that the move will help reduce their cost of living.
Dr Fashola noted that the window has just opened and that importers would need to source for foreign exchange (forex) to enable them import rice paddy to supply the mills.
”Importation will improve the supply of paddy but the impact on processing volume and pricing would not be immediate,” he said.
He said the import process will take some time before the paddy arrived, processed and made available to local markets.
He explained that the process of importing paddy is extensive and involves a detailed understanding of the complex import regulations which can be time-consuming and labor-intensive. He noted that before commencing the importation process, it is essential for the importer to be well-versed in the regulations related to paddy imports, to confirm the quality and safety of the paddy, and to establish the most favorable conditions and terms for importation.
The Chairman, All Farmers Association of Nigeria (AFAN), Lagos Chapter, Otunba Femi expects the policy to affect the price of rice in the next two months.
He said rice prices will go down soon. “Since there is no tariff to pay, it is going to impact on the price of rice. It will lower rice prices and additional rice supply in the market will boost the availability of rice,” he said.
Chairman & Chief Executive, Hyst Global Business Ltd, Nigeria, Mr. Biodun Onalaja, sees the policy bringing rice prices down in the next two months.
Onalaja who is a rice miller said his organisation formally applied for import permit to bring in paddy.
He expressed concerns that rising dollar exchange rate might raise the cost of imported rice paddy.
To provide supply to enable processing, Onalaja, said his firm has invested in rice farms in the North to boost increased paddy productivity.
According to him, rice prices may not decline considerably from the current level due to the high cost of importing of paddy using forex.
The rice miller, however, noted, that the import duty removal will reap rewards.
The Chairman, Rice Farmers Association of Nigeria (RIFAN) in Kebbi, Alhaji Muhammed Sahabi- Augie said the initiative will have a brief impact on rice prices but will disrupt local production.
He explained that members of the association were on the way to increasing total rice output nationwide.
“Some three years ago we were producing more than 80 percent of the needed national requirement because of the interventions provided under the Anchor Borrower Programme (ABP),” he said.
Following the suspension of the programme, he said rice farmers have been unable to raise production because of rising costs of fertiliser, pesticide, equipment, logistics, and labour.
He urged the Federal Government to implement strategies aimed at mitigating domestic shortages, which include enhancing subsidies for paddy farmers and intensifying oversight of the rice supply chain. He emphasized that rice farmers require policies designed to reduce production costs and enhance their income. Furthermore, he stated that structural reforms in the financing of the rice industry, along with investments in technology and innovation, could significantly boost the productivity and profitability of paddy farming.
The decline in rice paddy availability has intensified, prompting industry stakeholders to raise local rice production prices in response to escalating costs. Additionally, heightened insecurity and changing weather conditions on agricultural lands have significantly contributed to the decrease in domestic rice output. Following insecurity paddy acreage has remained stagnant. In July the Federal Government approved a 150-day duty-free window to allow the importation of maize, husked brown rice, and wheat as part of measures to combat rising food inflation across the country. The initiative was based on the implementation of the Presidential Accelerated and Stabilisation Advancement Plan.
