Importers To Pay N300bn Freight Rates On Foreign Rice To Nigeria, Others
Foreign rice importers will pay a total of N300 billion ($579. 75million) to shipping lines as freight rates by the end of this year.
The rice importers, who are expecting their consignments from Thailand and other Asian countries are from Nigeria, Republic of Benin, Togo and Ghana, it was learnt.
Last Thursday, the Nigeria Customs Service, Federal Operation Unit (FOU) Zone ‘A’ said, confiscated 13, 342 bags of 50kg just within the last five weeks.
Investigation revealed that in the first week of October, 2021, the shipping lines imposed $150 on a ton of parboil rice valued at $405 because of scarcity of containers.
According to Thai Rice Exporters Association (TREA), of the total amount, Nigerian rice merchants, who have ordered for 2million tons of the grain would pay $300million; Benin, $81million for 540,000 tons; Togo, $56.25million for 375,000 tons and Ghana, $142.5million for 950,000 tons.
Sources at the Federal Ministry of Finance said the shift away from container to bulk shipments have affected the cost of foreign rice importation to Nigeria and other West Africa countries from Thailand, Singapore, India and other Asian countries in the last quarter of this year.
As we are now in the month of December and preparing for the new year, a bag of foreign rice sells between N29,000 and N29,500 for the long grain and small grain variety in Nigerian market, while a bag of the local grain is sold between N22,000 and N25,000 and depending on the quality, the brand and the marketer.
Statistics by a global trade portal, Index Mundi revealed that the country imported 1.8million tons or 28 per cent of local consumption last year despite stringent measures by the government as local production of the milled rice dropped from 5.04million tons to 4.7million tons in the period.
The Thailand exporters have complained that container freight costs from Asian origins such as Thailand and India were almost twice the levels of break bulk ships loaded with rice arrived in West Africa amid clogged ports.
Thailand rice exporters have already cut the price of the grain from $507 to $405 in October, 2021 in order to enable them to supply their cargoes to West African buyers.
The development is coming as planned to achieve self-sufficiency in rice production by the Federal Government in 2022 is shaking as the country still depend on 1.8million tons of smuggled rice from the neighbouring country to meet local consumption despite the agreement entered into by Federal Government and the Republic of Benin in Abuja to end the smuggling of rice.
Investigation by Economic Confidential revealed that rice smuggling is now a big business as many Customs officers have lost their lives while carrying out their core responsibility of combating rice smuggling through our porous borders.
For instance, between late September and October this years, three Customs officers were murdered in Ogun State by the smugglers.
Although, government has been making substantial efforts for a decade to encourage rice cultivation in order to eliminate imports through subsidised loans, cheap fertiliser, free farmland and tax rebates, it was gathered that some farmers have refused to pay back their loans to the Central Bank of Nigeria (CBN).
According to the Rice Farmers’ Association of Nigeria (RFAAN) Niger State Chapter, some farmers had been dragged to court for defaulting in the repayment of loans taken from the CBN.
The association noted that farmers, who benefitted from the CBN special intervention project for rice farming were expected to return a certain amount of their harvests as loan repayment.
But the state’s Coordinator of the project, Idris Makaranta complained that they had refused to redeem the return expected from them from their last season harvest as agreed.
Makaranta explained the inauguration of the centre coordinators of the state RIFAN/CBN Special Project in Bida that: “From the 40,000 farmers, who participated in last season’s rice farming, we were supposed to recover between 300,000 and 400,000 bags of paddy rice but as we have only recovered about 100,000 bags.
“We have handed the defaulters over to court to recover our return for us while anyone who has brought more than 60 per cent of the returns would be considered for dry season farming.”
It would be recalled that the Federal Government had made moves to attract N250 billion investments in rice production following plans to establish an additional 14 rice mills in the country.
However, efforts to boost domestic production have been curtailed by smuggling through the porous borders.
Findings revealed that between January and April, 2021, the FOU in Lagos seized 41,652 bags of 50 kilogrammes smuggled parboiled rice from Idiroko and Ipokia in Ogun State and Lagos.
Also in Ogun State, 20,538 bags of rice were intercepted by the service between March and April, 2021.
No wonder, the National Chairman of Rice Processors Association of Nigeria (RIPAN), Alhaji Mohammed Abubakar Maifata has said that smuggling of foreign rice would soon come down to zero level, while the local rice would fill the gap conveniently if farmers received necessary support from the government and patronage by Nigerians.
