Dealers Sell Rice at New Rate After Christmas as Imported Grains Change in Prices
- The price of rice has risen again after a brief fall in December 2024 and January 2025 as dealers blame various factors
- Findings show that a 50kg bag of rice, which dropped to between N65,000 and N67,000 in December, rose to N75,000
- Agricultural consultant, Muhammadu Sanusi, says rice importation will not meet Nigerians' demand owing to country's population
Legit.ng’s Pascal Oparada has reported on tech, energy, stocks, investment and the economy for over a decade.
The price of rice has risen again after crashing during the Christmas and New Year holidays.
Feelers show that the price of the commodity, which sold for between N65,000 and N67,000 per 50kg bag, rose again and caused panic in many households after a brief respite.
Source: Getty Images
Rice prices skyrocket again
Findings show that the price of a 50kg bag of imported Indian short grain, which crashed from N90,000 in December to N65,000 and N67,000, had risen to about N75,000 with traders expecting further increases.
Imported Thai grain, which sold for as much as N100,000 during the December period dropped to N88,000 and N89,000 in January. However, the price has skyrocketed to N92,000 and N105,000, depending on the brand.
Locally produced rice has also risen in price as 50kg Bull rice went from N85,000 to N90,000, while Abakaliki rice sells for N85,000 and N90,000 in major cities across Nigeria.
Several Nigerians attributed the crash in prices in January to the naira’s value, which surged from N1,600 per dollar to N1,475.
Surveys around popular markets in Lagos showed that importers attributed the brief fall in rice prices to the strengthening of the local currency and better land border conditions.
Rice price increase: production drops
The Nation reports that rice production dipped in the 2024/2025 season to 5.23 million metric tons from 5.61 million metric tons experienced in the 2023/2024 season.
That is according to data from the United States Department of Agriculture (USDA), with one report estimating that the dip could be between 15 and 23%.
The data shows that figure is the lowest Nigeria has seen since 2020 when the COVID-19 pandemic halted farming.
Source: Getty Images
Farmers disclosed that rice earnings and profits are affected by the rising cost of inputs, with insecurity, climate change, and the import of cheaper foreign grains affecting agro-based companies from making a profit.
In 2024, the Nigerian government suspended the Anchor Borrowers Programme, which was touted as an initiative that boosted rice production in the country.
Importers blame exchange rates
The government alleged fraud was the reason for halting the initiative, saying farmers were not repaying their loans.
According to reports, millers blamed the shortfall in production and rising input costs as paddy rice prices soared by 10% to N70,000 and N80,000 per 80kg bag.
Chiwendu Chikwere, a rice wholesaler in Lagos said the current crash in exchange rates is affecting importers.
He disclosed that sourcing forex for imports is as hard as paying Customs levy which fluctuates daily due to exchange rate volatility.
“Importers are in limbo regarding the exchange rate. Most times, you don’t know how you can get the exchange rate for imports. So, importers are left speculating and that leads to inflated prices. Also, import duties are not pegged. Import duties are tied to exchange rate volatility, making it difficult for importers to plan,” he said.
Rice price hike: Expert warns of Impending food crisis
Agricultural consultant, Muhammadu Sanusi, has expressed concerns over the recent increase in rice prices in Nigeria which has been attributed to exchange rate volatility and import duty uncertainty.
Sanusi, in a chat with Legit.ng, said there is panic in the market due to speculations of importation of grains.
He noted:
"The drop in prices is transient because production cost is still high and also the cost of farming inputs and energy is high."
According to him, prices will continue to rise if nothing is done to improve security in the country.
As he aptly put it:
"Prices will continue to rise if nothing is done to improve security to allow farmers access to the lands. Also, if nothing is done to drop energy costs and the cost of farming inputs, the situation will persist."
On the possibility of importation meeting the country's demands, Sanusi said it is not a viable solution.
He concluded:
"Importation cannot meet our demands in Nigeria due to our population, hence investment in primary production remains the surest way to drop prices.”
Report predicts the price of local rice in 2025
Meanwhile, Legit.ng earlier reported that the price of locally-produced paddy rice in Nigeria was expected to rise by about 55% during the 2024/2025 season, worsening high living standards.
A new report by Afex Wet Season Crop Production 2024 showed a steady increase in rice prices, stating that during the season, rice prices rose 78%, with the average price hitting N630,000/MT.
PAY ATTENTION: Сheck out news that is picked exactly for YOU ➡️ find the “Recommended for you” block on the home page and enjoy!
Source: Legit.ng
