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Nigeria Annual Rice Report 2004
USDA, April 22, 2004
Nigeria’s rice production in MY2004/05 is forecast at 2.3 MMT, up from 2.2 MMT in MY 2003/04. The projected increase is based on a combination of improved input supply and favorable weather outlook. President Obasanjo has a new special initiative to promote self-sufficiency in rice production. A key element of the initiative is the GON’s subsidy on basic farm inputs, especially improved rice varieties. The government is promoting the adoption of the new hybrid rice varieties to help boost rice production. These new varieties are high yielding, early maturing, disease resistant, and high in protein content. Despite this initiative, however, Nigeria will continue to depend on imports to satisfy a growing consumer demand.

Rice imports account for close to half of Nigeria’s total rice supplies. Imported parboiled rice is directed at meeting consumer demand in urban areas where incomes are highest. Locally milled rice is of poor quality and is consumed mainly in the rural areas. Imported parboiled rice competes effectively against other basic food staples, which explains why import volumes have trended upwards in recent years.

Over the past year, the retail price of rice increased on average by about 30 percent reflecting the increase in the import duty and a devaluation of the local currency. However, the consumption level has remained fairly stable. Rice remains a regular item in the diet of most Nigerians, largely because of the convenience and the variety of ways it can be prepared. In Nigeria, rice is served as the main dish, not as a side food as in most other countries.

Post forecast Nigeria’s rice imports in MY2004/05 at 1.7 MMT, up from the revised MY2003 estimate of 1.6 MMT. The projected increase is due to limited supply of locally produced rice and other alternatives such as yams and beans.

Trade estimates of Nigeria’s wheat imports used in this report include all parboiled rice shipped to Cotonuo port. Following a collaborative study initiated by FAS/W in early 2004, we gathered that virtually all parboiled rice shipped to Benin Republic are actually destined for the Nigeria market. Nigeria is the only market for parboiled rice in the West African sub-region; Benin Republic is a market for regular milled white rice.

The GON’s prohibitive duty on rice imports is encouraging cross-border smuggling of the product. The import duty on rice is 100 percent. When port charges and other taxes are assessed, the effective duty on rice entering Nigeria through Nigerian ports is 119 percent. On the other hand, imports to Benin Republic attract only 35 percent duty, representing a $200 per ton price advantage over imports through Nigerian ports. Nigerian importers simply land their imports in Benin and then smuggle them into the country. Some importers ship to Cotonou port (Benin) and declare them as transit goods destined to the land-locked countries of Niger and Chad. Transit goods attract only five percent duty in Benin. The rice is subsequently smuggled into Nigeria.

Currently, U.S. milled parboiled rice can only compete for a share of the top niche segment of the Nigerian market. U.S. rice exporters are encouraged to collaborate with leading Nigerian importers to boost sales of their products. Promotional activities should target the growing middle to high-income consumers. These segments of the market are willing and able to pay for premium quality U.S. rice. Given appropriate marketing support, this market segment can increase commercial import purchases from the U.S. to 100,000 tons annually, up from the current level of less than 1,000 tons within three years.
MGR Archive 23.4.2004
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Region Type Price  
Russia Rapan $ 700
USA Jupiter Rice $630
USA Calrose #1 $830
USA Calrose #1 Paddy $480
EU Prices Baldo €660
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