Why the Price of Rice Will Keep Increasing

Rice dealers in Nigeria have attributed the rise in price as well as the scarcity of the commodity to the activities of the government and some specific stakeholders.
Just a year ago a bag of rice that was sold at N9000 is now sold at N18500. Although prices have plunged temporarily in a few state owing surplus availability of the commodity. Ganiyu Quadri, chairman of Alimosho LGA, says a bag of rice will drop to N9000 in Lagos before December. But the question is how long will it last?
Retailers are of the opinion that the raising price of rice is due to the ban of its importation. They believe that the hike in price is due to the activities of some individuals who monopolize the market. Since the marketers got their Form M approved last year, it is said they began stockpiling the now scares commodity. This of course made it easy to monopolize the market after the ban was instated.
Retailers are also of the opinion that the government also influenced the price of the commodity by applying the expert hands of the customs in seizing most brands excepts the brands which belong to the importers.
In march, 24 trucks of rice were seize in Owerri, on May 3, 8000 bags of rice were also seized in Lagos, May 27, 575 bags of rice were confiscated and of course just recently 2500 bags of rice were withheld by the Nigeria Custom Service.
According to retailers, rice are not bought from distributors except from the few brands for the fear the fear of their products being impounded. 
A trader said “Before we talk of banning importation we must first increase local production to avoid scarcity”. Nigeria consumes 5 million tons of rice yearly and currently produces less than 2.5 million tons. Obviously with rice being the staple food of the Nigerian population, it is not producing nearly enough to fight food scarcity.
Contrary to Mr Gniyu Quadri’s claims, the probability of the commodity price falling to as low as N9000 is simply false hope. Not when the Christmas celebration is just around the corner. If at all a miracle happens and the price of rice falls, it won’t be as low as N9000 and defiantly won’t last long as Nigeria is not self sufficient and does not have the necessary infrastructures such as silos to store the commodity.

If rice is to sell N9000 by December the government might have to temporarily lift the ban of the importation of the commodity or the commodity may well sell at over N20,000 by Christmas.



By Samuel George
Adeleke university Ede.

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By Unknown on Tuesday, 30 August 2016