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CBN’s forex policy on rice triggers fear among rice farmers, processors in Kano

The recent federal government’s announcement of lifting forex restrictions on 43 items has generated serious tension within the agro-business community, especially in the rice production…

The recent federal government’s announcement of lifting forex restrictions on 43 items has generated serious tension within the agro-business community, especially in the rice production sector, as fear has gripped many farmers.

It was gathered that the lift has generated a serious concern, especially by medium and mega rice farmers in the state as many of them perceive that the already established rice value chain sector would be in limbo. There is the fear that rice farming would be at great risk following the lifting of the ban on forex, which could lead to massive job losses as many milling companies would have to close down. And rice farming is likely to face extinction threat due to the level of competition that may emerge.

A rice farmer, Malam Usman Bello Barkum, said the news of the lifting of the ban, which is perceived to culminate into border opening, was the worst thing he heard in recent years because the already established sector would crumble. Meaning, there would be no business for farmers like him who have invested heavily in rice production.

“As rice farmers, we made good efforts to come this far. We made a lot of sacrifices to see that the rice value chain developed, but this speculation of border opening has ruined my efforts. Lifting the ban on forex is indeed a serious threat that may lead to rice farming extinction in Nigeria,” he said.

Similarly, the deputy secretary-general of the Rice Farmers Association of Nigeria (RIFAN) in Kano, Malam Ado Hassan, said it was important for a country of over 200million people to be 100 per cent self-reliant in food production. He, however, added that the lifting on forex ban on rice may not affect local production because it is apparent that land borders are still closed and the current dollar exchange rate may not complement the importation of the commodity into Nigeria.

He said what the government ought to have done was to mechanise and subsidise agriculture in terms of fertiliser availability and affordability.

“What Nigerian farmers really need is to move from local agricultural practices to more subsidised mechanised agricultural practices that will allow for mass production. There are millions of farmers that are currently cultivating rice, but the lifting of the ban on forex sent an unnecessary concern. But we told our members not to be scared because things will be fine,” he said.

However, rice millers in Kano State said there was no cause for alarm as Nigerian land borders remained closed for rice importation. According to the managing director, Gerawa Rice Mills, Kano, Alhaji Muhammad Isyaku, the announcement by the federal government is only on forex ban lifting, so rice farmers should not panic.

“Indeed, there is need for clarifications on the new directives, but as its stands, our land borders remain closed for rice importation. However, no doubt, the lifting of ban on forex may not have an immediate negative effect on the rice production sector, but it is obvious that it will have that impact in the long run; therefore, farmers and millers should not worry for now,” he said.

He further explained that with the lifting of ban on forex, rice is automatically out of the question because the exchange rate would not allow importers to import rice. He added that at the international market, a kilogram of rice is selling at $1.4; and with shipment fees, coupled with tax, a 50kg of rice will cost not less than N75,000 when imported to Nigeria legally.

 

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