Our rice, fertiliser revolutions
Today, we want to share with you, the giant strides that the Buhari Administration has made in two key areas: The Rice Revolution and the Fertilizer Revolution!
But before I go into details, let me say this: The country has never been closer to self-sufficiency in rice, a national staple, than now. Our target is to achieve self-sufficiency in our paddy production in two years, by 2020.
This has been made possible by the purposeful leadership of President Muhammadu Buhari, who has consistently said that this nation must produce what it consumes. Recall that President Buhari launched the
Anchor Borrowers’ Programme on Nov. 17th 2015. The programme aims to provide farm inputs, in cash and kind, to smallholder farmers to boost local production of commodities, including rice, stabilize inputs supply to agro-processors and address the country’s negative balance of payments on food.
The result is the exponential growth in local rice production that has now moved us closer to ending rice importation. Within two years, rice importation from Thailand fell from 644,131 Metric Tons (in Sept 2015) to 20,000 MT (in Sept. 2017). That’s over 90% drop! Let me put things in perspective. So far, less than 100 billion Naira has been spent on the Anchor Borrowers’ Programme that has achieved so much. Meanwhile, in April 2008, the federal government had to quickly release 80 billion Naira from the Natural Resources Development Fund to import 500,000 MT of rice in order to cushion what it said was the effect of a global disaster. Imagine that we have ploughed that money into rice production in 2008! We would have been exporting rice by now.
Where we stand in rice farming, rice milling and distribution today
– According to the Rice Processors Association of Nigeria (RIPAN), there are more than 11 million rice farmers in Nigeria today, up from
5 million in 2015.
– RIPAN’s total investment in the Nigerian economy is in excess of N300b. Upcoming investments will amount to N250b.
– The new investments will add 5,000 jobs and additional 1,775,000MT of integrated rice milling capacity.
– It will save $300m FOREX from import substitution through local processing.
– Nigeria’s rice paddy production has seen significant growth in the past 3 years, from 4m MT to 7m MT.
– Nigeria’s rice import bill, hitherto at $1.65 billion annually, has dropped by over 90%
Self-sufficiency in rice production
– As I said earlier, our target is to achieve self-sufficiency in our paddy rice production by 2020
– Nigeria’s current rice consumption is approximately 6m MT of milled rice.
– In 2015, Nigeria produced 2.5m MT of milled rice. By 2017, it rose to 4m MT, leaving a gap of 2m MT. Our target is to fill that gap by 2020.
– In 2015, there were only 13 Integrated mills. By 2017, the number rose to 21, after 8 more were added (please note that the new investments were made when Nigeria was in recession, indicating investors’ confidence in Mr. President and the Nigerian economy)
– The investments have not stopped. 15 more mills are about to take off, including the Dangote Rice Mills to be established in six states with a total capacity of about 1m MT.
Job creation from increased rice production
– RIPAN members presently employ 5,000 skilled Nigerians (Direct Employment)
– 5Five million farmers (Indirect Employment)
– Over 500,000 input suppliers (Indirect Employment)
– Hundres of thousands of unskilled workers, including labourers (Indirect Employment)
– You can then do the maths yourself to see the total number of jobs that have been created by RIPAN alone. Remember that there are small scale rice millers all over the country who are not RIPAN members.
The challenge of rice smuggling
– Rice smuggling is the biggest challenge facing rice production in Nigeria. According to the Rice Millers Importers and Distributors Association of Nigeria (RIMIDAN), over 2m MT of parboiled rice were smuggled into Nigeria in 2017
– Smuggled rice is primarily sourced from Thailand and India and comes
into Nigeria through the country’s borders with Benin, Niger and Cameroon.
– Let’s look at rice smuggling through Benin. The total demand for white rice (white rice is consumed in Benin, against parboiled rice in Nigeria) is 400,000 MT. Yet the country, with a population of about 11 million, imports between 1m and 1.2m MT of rice annually. Who are they importing for? Nigerians of course. In fact, as Nigeria’s rice import falls, Benin’s rice import increases. Most of the parboiled rice imported by Benin eventually lands in Nigeria through smuggling.
– Both Cameroon and Benin Republics have lowered tariff payable on rice to zero and five per cent respectively to encourage importation and subsequent smuggling of the product into Nigeria.
Why imported rice is cheaper than local rice and what can be done to reverse this?
– Presently, smuggled rice costs between N11,000 and N13,000 per 50kg
bag. Nigerian processed rice sells for between N14,500 and N15,000 per
50kg bag. Smuggled rice is sourced mainly from Thailand and India, which gives a high level of subsidies to rice farmers and rice processors. In fact, rice receives the largest amount of agricultural subsidy in the world.
– Local rice producers have made some representation to the government
on how Nigerian rice can compete favourably, in terms of pricing, with the
heavily-subsidized imported rice.
The role of fertilizer in the rice/agric revolution
Fertilizer production in Nigeria today is a success story. Recall that President Buhari set up the Presidential Fertilizer Initiative (PFI) in December 2016 to deliver commercially-significant quantities of affordable and high-quality fertilizer at the right time to the Nigerian farmer. The PFI has turned out to be a magic wand in fertilizer production.
– Recall that the agricultural sector and the country’s food production were negatively impacted in 2016, as farmers became exposed to high and rising prices for key agric inputs
– In 2017, PFI delivered 10 million 50kg bags (500,000MT) of NPK
20:10:10 fertilizer at a price of N5,500 in time for the wet season. That’s down from the price of N9,000 per 50kg bag in 2016 – a 40% reduction in price.
– In 2018, PFI targets the delivery of 20 million 50kg bags (1 million MT), double the figure for 2017
What PFI has achieved
– Before PFI, each imported fertilizer bag was subsidized to the tune of N6,000 per bag. In 2017, PFI saved the government N60b in would-be subsidies.
– The FOREX savings in 2017 was $150m, thanks to the substitution of imported inputs of NPK with locally-sourced inputs. Limestone is sourced locally. Urea is sourced locally. Phosphate is imported on from Morocco, with which we have negotiated a long-term bulk purchase agreement. Mr President personally led the negotiations with the King of Morocco and his team on the long-term bulk phosphate supply agreement.
Potash is imported from Europe.
– 11 moribund fertilizer blending plants with a combined capacity of over 2m MT have been revived. 12 more are to be revived to bring to 23 the total number of plants that will partake in 2018 PFI.
– Over 6m bags of fertilizer have been sold to farmers at N5,500 per bag.
– There is now a higher patronage for the country’s rail network due to movement of raw materials and finished goods.
– Also, the bag-making sector of the economy boosted, with over 10mpackaging bags produced exclusively for PFI
– 60,000 direct jobs and even higher number of indirect jobs have been created.
The agricultural revolution in general and the rice revolution, in particular, have taken millions of Nigerians out of poverty. As a matter of fact, today, 60% of rice eaten in Nigeria is produced in Nigeria. In the words of the rice processors, the rice revolution alone is enough to guarantee re-election for President Buhari, if he decides to run again!
We want to use this opportunity to appeal to Nigerians to complement the efforts of the government by consuming only locally-grown and processed rice. It is fresher. It is tastier. It is healthier. It has not spent months on the high seas and warehouses. We don’t know where or how imported rice is made or how old it is? It is reported that most of the rice dumped on us are old and probably rejects. The citizens of those countries do not eat this rice. The citizens of Benin also do not eat it. But they send it to us. Unhealthy foods are dangerous to health. So let’s eat what we can vouch for.
But Nigerians should remember that every time they eat imported rice, they are eating the jobs that would have been created for Nigerians and instead funding the creation of jobs in the source countries. Just imagine that less than three years into the rice revolution, millions of jobs have been created in the whole value chain.
It is important for Nigerians to know that when they consume imported rice, they are creating jobs in India and Thailand and destroying jobs across our country. Today we have rice farmers in all states and all geopolitical zones. In fact, most of us have friends and relatives who are farming rice. So if we don’t patronize their product, we are destroying their livelihoods.
In this regard, we are embarking on a massive nationwide campaign to sensitize our compatriots to the need to support the rice revolution by consuming local rice. Nigerians are patriots. They want more jobs. They will support the rice revolution and Nigeria will become self-sufficient in rice sooner than we have stated.
*Alhaji Mohammed is Nigeria’s Minister of Information and Culture