In collaboration with the private sector, some states are investing in local rice production. According to experts, this strategic move will create jobs, reduce poverty and fast-track the Federal Government’s self-sufficiency plan for rice, if smuggling and policy inconsistency, among others, are addressed. Assistant Editor CHIKODI OKEREOCHA reports.
A subtle battle for the control of the rice segment of the agriculture sector is raging among some states in the country. From the Southwestern states of Lagos and Ogun to Ebonyi, Anambra and Enugu in the Southeast; the Middle Belt and Northern states of Kebbi, Benue, Borno, Kaduna, Kano, Niger and Taraba, among others, a state-led push to boost rice production, processing and distribution has taken centre stage.
For instance, the push by each state, in collaboration with private sector investors, to position itself as the number one rice producer, has seen Lagos and Kebbi states set ambitious targets of meeting 70 per cent of Nigeria’s rice needs.
This is on the strength of a recent strategic partnership that culminated in both states signing a Memorandum of Understanding (MoU) to leverage their areas of comparative advantage to develop the rice value chain.
The MoU, ratified by Governors Akinwunmi Ambode of Lagos and Atiku Bagudu of Kebbi, hopes to end the era of imported rice. “…we have the economic prowess to produce rice locally. The era of imported rice is gone,” Ambode said in Lagos, at the signing ceremony.
Nigeria, Africa’s largest rice consumer, consumes about six million metric tons of rice annually, and spends an estimated N360 billion yearly on the importation of the product. This translates to an average of N1 billion per day. While half of the volume is imported mostly from India, Thailand, and Brazil, about 2.8 million metric tons is produced locally. The country, however, targets a total rice import replacement by 2018.
The Lagos/Kebbi partnership, as well as interventions by other states, may have raised hopes of achieving this target. For instance, highlighting the Lagos’ areas of strength, Ambode said it is the largest consumer of food commodities in Nigeria, by virtue of its population, estimated at 21 million.
He said Lagos State has an estimated consumption of over 798,000 metric tonnes of milled rice per year, which is an equivalent of 15.96 million of 50kg bags, with a value of N135 billion per annum. It also has the market, with the required purchasing power.
To engage youths and boost rice production, 100 farmers have been settled on the 500 hectares of land acquired in Eggua, Ogun State through the FADAMA III additional financing programme. The Commissioner for Agriculture, Mr. Toyin Suarau, who made this known at a press briefing last week to commemorate Ambode’s first year in office, said through this arrangement, rice cultivation had improved.
“The yield has improved from less than one tonne per hectare to about three tonnes per hectare with double cropping in some areas where irrigation facilities are provided. The state government is also poised to expand its rice mill at Imota from 2.5 metric tonnes per hour to 10 metric tonnes per hour, while at the same time encouraging private sector operators to invest in rice processing,” Suarau said.
On the other hand, Kebbi State boasts of a vast arable land suitable for the cultivation of rice. It is an agrarian state with over 1.2 million hectares of arable land characterised by very large floodplains, lowland swamps and gentle slopes. In the 2014/2015 wet season, over 600, 000 hectares of land were deployed for rice cultivation in the three senatorial areas of the state.
Kebbi people are also traditionally rice farmers with average land holding of about 10 hectares. Presently, Kebbi has over 50,000 metric tonnes of paddy in store produced from the last two planting seasons.
“What we are doing is to pioneer a collaboration that will bring other states on board later as we believe that our potentials are enormous and we must have pacesetters to start that process of joint collaboration for our collective good,” Governor Bagudu said.
Anambra, Ebonyi also involved
Ebonyi and Anambra states appear determined to give Lagos and Kebbi a run for their investments. The Southeast states, as part of their plan for life without oil, are investing in rice production.
For instance, Anambra State has projected an increase in the volume of rice production from the present 80,000 metric tons to 400,000.
To achieve this, the state has begun the distribution of 120,000 metric tons of high-yielding rice species to farmers for this year’s planting season through their various cooperative societies. This, according to Governor Willie Obiano, will give the state over 300,000 metric tons of rice at harvest time.
The target is coming on the heels of the inauguration of a multi-billion naira farm project in partnership with the Coscharis Group at Anaku town in Ayamelum Local Government Area of the state. The state government, The Nation learnt, has committed N300 million to the partnership.
The project, known as the Coched Farms Project, is a joint venture between the state government and the Coscharis Group. It is expected to lead to the cultivation of 2,500 hectares of rice per season and a production capacity of 12,000 metric tons per annum in the first phase.
Obiano said the project will generate about 1,000 full-time and seasonal jobs for youths and women across the entire rice value chain.
The farm is expected to produce 8,000 to 12,000 metric tons of paddy per annum with an expected income of N400 million to N600 million per annum when fully developed. At an estimated market value of N140,000 per metric ton of processed rice, the expected income will be between N784 million to N1.176 billion per annum when the production and processing infrastructure are fully developed.
“These estimates fall nicely into my campaign promise to ‘Ndi Anambra’ that we shall drive development through agriculture to create jobs, boost our domestic economy and shore up the revenue profile of the state,” Obiano said.
According to Maduka, the project at full operation would provide 500 direct jobs and 2, 000 indirect jobs and would extend to other parts of the state. He said in addition to the rice farm, the project also had a rice mill of 20 tons per hour capacity that would provide services to local farmers.
With what the state has done in the rice sector so far, Obiano is optimistic that in few months time, the state would not only have enough rice for domestic consumption, but export the product. He hinged his optimism on the existence of a cluster of investors in the state for rice production.
Similarly, Governor David Umahi of Ebonyi State recently ordered the disbursement of N1 billion to rice farmers as a revolving loan. He said the money would not be given to the farmers in cash, but as seedlings, fertilisers, and pesticides among other facilities.
The governor, who made this known at a special stakeholder’s forum on rice production in Abakaliki, the state capital, said the money was borrowed from the Federal Government, and will be deducted from the state’s monthly allocation .
To underscore the state’s determination to be a major player in the rice business, the state government went a notch higher, compelling each public office holder in the state to cultivate at least five hectares of rice this 2016 farming season. The public office holders include state executive council members, local government area caretaker chairmen, coordinators of development centres, and council liaison officers, among others.
“We have so far acquired 54, 000 hectares for massive rice cultivation and more are expected to ensure the attainment of the rice production goal”, the state’s Commissioner for Agriculture and Natural Resources, Mr. Uchenna Orji, said.
Edo, Jigawa, Kwara, Niger, others intensify push
Anambra State is not the only state riding on the support of private sector investors to claim the number one spot in the rice business. Edo State has also opened its doors to the Stallion Group for investment in rice production. The group recently stormed Government House, Benin, the Edo State capital, to indicate its interest to invest in rice farming.
The Business Development Manager, Stallion Group, Mr. Sunil Dhermappa, said the firm has the largest capacity of rice mills in sub-Saharan Africa, with factories at strategic locations in Lagos and Kano to enhance prospects of processing local paddy and with capacity of four million bags per annum.
Interestingly, Edo State is also one of the five states across the country where foremost industrialist and President, Dangote Industries Limited (DIL), Alhaji Aliko Dangote, is investing $1 billion (about N165 billion) in rice production and processing. Others are Jigawa, Kebbi, Kwara, and Niger states. A total of 150, 000 hectares of farmland had been acquired in these five states for the project.
Expected to become the largest single investment ever made in rice production in Africa, the project, according to the MoU DIL signed with the Federal Ministry of Agriculture and Rural Development (FMARD), also involves establishment of two state-of-the-art large-scale rice mills with a capacity to mill 120,000 metric tons of rice paddy each.
This brings the total capacity to 240,000 metric tons, with plans to double the capacity within two years. The rice plant is estimated to produce 960, 000 metric tons of milled rice, representing 46 per cent of rice imported into Nigeria. “Our goal of making Nigeria a net exporter of rice will be achieved faster by this significant investment,” Dangote said. That was last year when the deal was consummated.
As an integrated operation, the Dangote farms and the mills are expected to significantly boost smallholder rice production in the regions through a nucleus and out-grower farming model, thereby transforming livelihoods in rural Nigeria. Also, the selected sites are rice-growing communities and they will be supported by Dangote’s provision of agro-inputs, training, and marketing linkages in order to improve community farming operations. Employment opportunities will also be created for at least 8, 000 Nigerians.
Smuggling, policy inconsistency, others are threats
Heart-warming as the state’s involvement in rice production is, there are formidable hurdles, one of which is the nation’s numerous porous borders through which rice smuggling thrives.
According to experts, cross-border smuggling, particularly via the Cotonou Port, remains one of the greatest huddles before local rice producers and this may frustrate the current move by state governments to take advantage of the sector to diversify their economies.
Smuggled rice often finds its way into various communities and towns in Nigeria through the neighbouring countries. The penchant of most Nigerians to consume imported rice at the detriment of local ones also fuel smuggling.
This is partly responsible for why local rice production accounts for less than 50 per cent of the country’s total consumption, leaving the huge demand gap for polished/milled rice imported mostly from India, Thailand, and Brazil.
The consensus is that until and unless government stems the rising tide of cross-border smuggling, manage the tariff regime to ensure product availability, fair/stable consumer prices, and protect local producers/processors that are rendered cost uncompetitive by environmental factors and infrastructural handicaps, among other challenges, the latest intervention by state governments may not enhance the nation’s chances of achieving the rice self-sufficiency target by 2018.
