Rice millers decry import waiver, rising production costs

Local rice millers in Nigeria are facing an existential crisis, warning that a government import waiver, while benefiting consumers with lower prices, is actively destroying the domestic industry. Peter Dama, National Chairman of the Rice Millers Association of Nigeria, highlighted the stark contrast between the waiver's impact on consumers and its devastating consequences for local businesses.

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This importation, Lagosians are saying that they are happy because of the waiver. They can now buy rice for N48,000 and N49,000, and they are happy because the waiver is working for them. The waiver is working for them but killing the industry in Nigeria.

"The waiver is working for them but killing the industry in Nigeria," Dama told Sunday PUNCH, referring to consumers in Lagos who can now purchase rice at significantly lower prices. He explained that countries exporting rice to Nigeria heavily subsidize their agricultural sectors, allowing them to produce and export at costs Nigerian millers cannot match. "India subsidized their farmers. China subsidized its farmers. Malaysia subsidized its rice farmers. Japan subsidized its rice farmers," he noted, underscoring the global disparity in agricultural support.

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Because the government is importing, but the other countries are subsidizing their own agriculture. Nigeria is not subsidising anything.

In contrast, Nigerian farmers and millers receive little to no meaningful support. Dama lamented the lack of agricultural subsidies in Nigeria, stating, "The fact of the matter is that the subsidies are not there." This absence of support, coupled with rising production costs, makes it impossible for local millers to compete. Dama illustrated the dire situation: "So for example, you use N10 to produce your rice, and then at the end of the day you go and sell your rice for N3. Is that a gain or are you just completely collapsing?"

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So for example, you use N10 to produce your rice, and then at the end of the day you go and sell your rice for N3. Is that a gain or are you just completely collapsing?

Further compounding the industry's woes are escalating labor and transportation costs. Dama cited the daily wages for laborers, which have risen sharply, making processing and moving rice increasingly expensive. The inability to compete with subsidized imports and the escalating domestic costs paint a grim picture for Nigeria's rice milling sector, which Dama described as "unsustainable."

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You produce at a higher rate. And you know, for example now, if you go and pick up a labourer, and tell them to come and work, let them be, you know, drying or washing, you know, your rice, your paddy. Every blessed day, they work, and they work based on hours. And they charge you, say for example, a day is N5,000. How can you cope?