NIGERIA – Nigeria is expected to import 2.3 million metric tonnes of rice in 2024, a 10 percent increase from the 2.1 projected this year making it among the world’s largest buyer of the staple.
This is according to the United States Department of Agriculture (USDA), in its 2023-grain report on Nigeria.
Import forecasts for Nigeria, Africa’s most populous nation, were raised due to stronger than expected demand caused by both high domestic rice prices and quality concerns according to the USDA.
Experts suppose that Nigeria may see the cost of its rice imports for the 2023/24 marketing year outstrip the cumulative N1.08 trillion spent under the Anchor Borrowers (ABP) – a scheme that provides farmers with critical funds and inputs needed to boost local production in eight years.
Currently, a metric ton of parboiled rice sells for US$568 per ton, data from the International Grain Council shows.
This means that Nigeria may spend a whopping US$1.31billion importing rice in 2024 (2.3MMT multiply by US$568 per ton).
Using an exchange rate of N900/$, the country will spend N1.2 trillion (US$1.31bn) to import parboiled rice, which exceeds the total funding for ABP by N100 billion.
“Insecurity in farming areas, high input prices, and inadequate mechanisation favours rice imports over the possibility of encouraging more production due to higher prices,” said the report.
Annual inflation in Nigeria increased to 27.33% in October, up from 26.72% in September, the country’s National Bureau of Statistics said on Wednesday.
Food inflation jumped to 31.52% in October, compared to 23.72% recorded over the same period last year.
Inflation has risen to a 20-year high and the local currency naira has weakened by more than 40% since June after President Bola Tinubu’s removal of a fuel subsidy and lifting of exchange controls.
In October, the Central Bank of Nigeria (CBN) restored the 43 items, including rice, it prohibited from access to foreign exchange (FX), after eight years.
The move analysts say will further increase the importation of rice next year owing to Nigerians high prference for local parboiled rice and quality issues.
Despite the increase in productivity per unit of cultivated land and the expansion of mills in the last four years, the quality of most local varieties has remained perpetually poor, thus fuelling consumers’ preference for foreign varieties.
The US Department of Agriculture’s report showed Burkina Faso is also among the African countries expected to significantly increase its imports next year to 525,000 tonnes due to reduced domestic production.
Global rice trade in calendar year 2024 is projected at 52.85 million tonnes, the report said.