The Nation Newspaper

Tag: rice millers

  • Rice millers’ lament

    WE are not surprised at the finding by the Rice Processors Association of Nigeria (RIPAN) that over 20 million bags of rice (approximately one million metric tonnes) were smuggled into Nigeria between January and March. According to RIPAN chairman, Mohammed Abubakar, investigations conducted by the association in the last few months indicated that “all our international borders have been converted to smugglers’ route and our markets are filled with smuggled foreign rice.”

    “Nigeria currently loses huge revenues, foreign exchange and jobs to this menace. Nigeria rice processing companies are shutting down because of their inability to gain market access. More painfully, millions of small-holder farmers are stuck with their paddy because the millers can no longer afford to buy from them”, he told newsmen in an interview in Abuja, last week.

    He did not spare officials of the Nigerian Customs Service (NCS) at the borders, some of whom he accused of colluding with smugglers to undermine the nation’s quest to attain self-sufficiency in rice production, warning that the magnitude of loss to stakeholders would be too devastating to cope with.

    “The development, if left unchecked, could impact negatively on the integrated rice processor’s capacity, which had increased from 800,000 metric tonnes in 2014 to 1.6 million metric tonnes in 2018″, he said.

    We sympathise with the millers’ body. Indeed, the threat from smuggling, given their exposure to other players in the rice value chain, borders on an existential one. The issue, however isn’t that the problem of smuggling, particularly of rice, is a recent phenomenon but the failure of the Federal Government to recognise it for what it is – a serious act of economic sabotage – and confront it accordingly. Surely, the Federal Government has a surfeit of intelligence to  stamp it out. For instance, only last December, Heineken Lokpobiri, Minister of State for Agriculture had cause to decry the abuse of the Economic Community of West African States protocol allowing neighbouring countries to bring in rice into Nigeria.

    According to Lokpobiri, “people from Thailand would go to Benin Republic with their parboiled rice and then re-bag them as though they were produced in Benin Republic and then smuggle them into Nigeria, thereby denying the people of Benin the opportunity to grow rice and then benefit from the Nigerian market”.

    Earlier in 2018, Vice President Yemi Osinbajo, acting on intelligence on three shiploads of 120,000 metric tons of Thailand rice headed for Nigeria via Benin Republic could not but raise the alarm. The preceding Christmas, he spoke of some 500,000 metric tons of rice also denied entrance from the same country.

    Unfortunately, as if part of an incipient culture of denial, the Federal Government continues to tout the decline in import of Thai rice from 644,131 metric tonnes in 2015, to 58,260 metric tonnes in 2016, and 23,192 metric tonnes in 2017 as achievement while pretending to be oblivious of the corresponding figures from our other neighbours. For instance, rice imports from  Benin Republic rose geometrically from 805,765 metric tonnes in 2015, to 1,427,098 metric tonnes in 2016, and 1,811,164 metric tonnes in 2017.  Cameroun also witnessed a surge in Thai rice imports from 449,297 metric tonnes in 2015, to 505,254 metric tonnes in 2016 to 744,508 metric tonnes in 2017. In the circumstance, only the Federal Government still lives under the illusion that those dramatic surges in imports are headed anywhere other than Nigeria – sadly for an administration that has acquired a reputation for aggressively pushing for self-sufficiency in the nation’s major staples which the illegal trade directly undermines.

    We  agree with RIPAN that the time to tackle the menace of rice smuggling is now; just as we shudder to think of the grave risk of the failure to act on the initiatives and the linkages that they have spawned in the rice value chain. While we agree that the customs management can do more to curb corruption and indolence in the ranks of its men, the nature of the problem is such that require engagement between the Nigerian government and our ECOWAS neighbours. For far too long, our ECOWAS neighbours have taken advantage of our good neighbourliness to undermine our economy; the rice issue obviously provides one avenue for the Federal Government to demonstrate, for once, a clear resolve to defend our national interest.

  • Fed Govt suspends quota issuance to rice millers

    Fed Govt suspends quota issuance to rice millers

    The Federal Government has suspended the issuance of quota to millers for rice importation.

    The Permanent Secretary, Ministry of Agriculture and Rural Development, Mr. Sonny Echono, said there would be no issuance of quota to any intending importer for now pending the review of the policy which gave preferential treatment to some importers.

    Echono, in an interview with reporters in Abuja at the weekend said the suspension became necessary because of abuse of the policy by rice millers, adding that only those who were paying 70 per cent import duty would be allowed to bring in rice for now.

    He said there is no subsisting allocation for this year as the allocation for last year had expired.

    The permanent secretary said the volume of rice that would be allowed into the country would be limited to the current supply gap.

    He said the country had a supply gap of about 1.5 million tonnes between national rice demand and supply, blaming the situation on insufficient local milling capacity.

    Echono however said the Ministry was addressing this challenge.

    He also said the Ministry would seek clarifications on measures put in place by the Nigeria Customs Service (NCS) to ensure that importers pay appropriate duty for rice imported through land borders.

    Mr. Echono said the clarification became necessary following the lifting of the ban on importation of the commodity through land border by the  NCS last week.

    “I will be meeting with the Comptroller-General of Customs in the interest of the principle of consistency in policy. As long as the machinery for the importers to pay the appropriate duty is in place on the land borders, it should not be a problem.

    “Rice importation through land border was earlier banned because the machinery for proper duty collection at the borders was not in place.

    “But if they put in place the right policy to ensure that the routes are clearly defined and duties are paid before they bring rice in, then, we need to get the assurance on how the mechanism works. That is why I need to meet him,” he said.

    The permanent secretary said lifting of the ban was not a problem, adding that the ban was earlier placed because of lack of machinery for proper collection of duty at the borders which had no defined routes to check smuggling.

  • Crackdown on rice millers: Investors accuse NCS of undermining rule of law

    Crackdown on rice millers: Investors accuse NCS of undermining rule of law

    Rice millers have accused the Nigerian Customs Service of undermining the law by its persistent crackdown on rice importers into the country. They said the continued shut down of their  warehouses is  undermining the spirit of the rule of law which the federal government promises to uphold.

    They said the behaviour of the operatives of the NCS in sealing their warehouses without due process, “is a total affront to the gospel of the rule of law which the President Buhari administration promises to uphold.

    “The recent physical crackdown by officers of the Nigerian Customs on companies allegedly owing excess duties levied after customs had cleared their goods for importation, is believed to be an effort to paint the present Customs administration white and escape the cleansing brush of this administration.

    “If the administration swallows the hook, it will spare the leadership and prolong its stay at the helm of affairs of the highly lucrative border agency, the importers said, adding that the sudden crackdown by Customs, in the face of court orders restraining them from taking action against the companies until the various court cases instituted in this respect are vacated, is a clear evidence of  flouting the laws of the land.

    It will be recalled that early in the week of 27 June, heavily armed men of the Nigerian Customs invaded premises of seven companies alleged owing N23.6billion on account of unpaid levies in respect of rice importation. Customs alleged that the companies had imported rice in excess of quotas granted them by the Federal Government in its Rice Policy circular. They demanded payment of 40  per cent levy on the deemed excess, imported between June and December 2014.

    “One would have asked if Customs officers had access to this policy paper ahead of the importation and admittance of the goods through our ports. One would have wanted to know if Customs was aware of the conditions of the incentives attached to these policy initiatives and the conditions under which the incentives could be availed.

    “Knowing how thorough our Customs men are, they would have scrutinized the policy document and referred it to their legal officers for advice before implementation. Based on their interpretation of the Rice policy circular,  they accepted documents submitted by importers operating under this incentive programme at point of importation, and allowed their cargo be cleared by paying the prescribed 10 per cent duty and 20 per cent levy. They accepted this rate repeatedly for six months until December 2014, when the Federal Ministry of Agriculture woke from its slumber and remembered that it had failed to convene a meeting of the inter-ministerial committee as directed by the government or issued quotas to bona fide rice value chain operators as required by the directive. The inter-Ministerial Committee was saddled with the task of determining the supply shortfall in rice to be made up by importation and the allocation of quotas to bona fide investors.

  • Fed Govt adopts credit scheme for rice millers

    Fed Govt adopts credit scheme for rice millers

    The Federal Government has designed a credit scheme for 10 initially pre-qualified firms to set up 17 model rice processing mills in the country.

    Investigations revealed that estimated cost of each mill is N1.4 billion and would be financed by 40 per cent by the Federal Government’s rice fund credit and 60 per cent by the beneficiary firms and commercial banks.

    Sources said the credit facility, which is mainly to finance plant and machinery and associated costs, would be for a tenor of 20 years with five years moratorium at an interest rate of four per cent per year. Six out of the 10 applications that were able to meet the Federal Government /BoI requirements have been approved by BoI for N5.040 billion

    To create room for more entrepreneurs in the sector, the Federal Government came up with a new initiative in the industry by setting up 100 rice mills billed to be located in the 36 states where interested entrepreneurs and investors will be encouraged to take over these mills in a public private partnership (PPP) arrangement.

    BoI’s Acting Managing Director, Waheed Olagunju, said rice millers, United Nations Industrial Development Organisation (UNIDO) and BoI are also supporting the establishment of Abakaliki Power Plant Limited in Ebonyi State in order to use rice husks from three rice milling clusters in the state for bio-fuel production.

    Others are long term loans to be obtained through UBA under the Central Bank of Nigeria (CBN) Intervention Fund and business model and technology that has been tested in Asia.

    The idea, according to him, said is to transform the nation’s agro-economic sector from primary to manufactured products, traditional technologies to modern technologies and innovation. He hinted that the bank plans to tap into where the nation has comparative advantage and competitiveness.

    He pledged the government’s commitment to providing an enabling business environment with strategic infrastructure, technical assistance and financial services.