By Gabriel Ewepu
Peter Dama takes a deep breath before saying slowly: “Yes. Rice price has crashed, and Nigerians are benefiting. But as local producers, we are losing big.
We are losing billions. “ He singles out import duty waiver to select importers, which has flooded markets across the country with imported rice and crashed price, but to which local producers of the staple food are losing big, as the main cause of their woes.
Local producers are losing significantly because their products cannot compete with cheaply imported rice, largely due to the high cost of production. From the tone of Dama’s voice, you can understand his disappointment that the business in which he and his colleagues have invested massively doesn’t appear to be giving them the returns they envisaged.
“Go to the market, you will see that rice has flooded the entire place. We have always said that importation should be stopped. “For rice, through what they call import waivers, to continue to flood our markets, to crash prices, it should be stopped”, he says as he raises his voice. Sunday Vanguard had visited him in his rice mill to get his perspective on the crash of the price of rice as Christmas approaches. Rice sells like hot cake as Christmas looms every year. Compared to last year, the price of the staple food has crashed by at least 30 percent. For instance, a 50 kilogram bag of rice, depending on the brand, currently sells for between N55, 000 and N70, 000 as against N105, 000 it sold for around this time in 2024.
Is the crash due to massive production of local rice? Dama, who is the National President of Rice Millers Association of Nigeria, RIMAN, shakes his head before narrating the woes of farmers and millers owing to the flooding of Nigeria with imported rice.
According to him, the crash is mainly due to the implementation of the waivers granted to some importers to bring in about N2 trillion grains to tackle food inflation under a 150-day duty-free window, aka Presidential Accelerated Stabilisation and Advancement Plan, an initiative of President Bola Tinubu, in 2024.
The Minister of Agriculture and Food Security, Senator Abubakar Kyari, had announced the measure, saying the grains included rice. As the imported rice came in, price began to fall.
Meanwhile, local producers, including farmers and millers, who have invested billions in the sector and contending with high cost of production, cannot compete with the importers who have had to bring in cheap, duty-free rice. Worse still, it is harvest period for farmers, meaning that there is surplus of rice paddy which millers cannot uptake and process for consumption because the market is saturated with imported rice.
Dama, who himself is not immune from the issues in the sector as he has had to shut down his rice mill due to the inclement situation, narrates the high cost of producing local rice which makes it more expensive than imported brands.
“As we always say, the prices of inputs have not gone down. Has petrol, transportation for those who are milling who have big factories gone down, has the cost of electricity gone down?” he explains. “These are the variables we have always been talking about and saying that government should look into and help the average investor not only in rice, but also in all the sectors, so that people will have the funds to be able to buy, and government should also stop all these waivers.
“Some rice mills are running, some are not running. I’ve told you even availability of the funds to pick up the paddy, it is just not there. “There is no money in circulation that people will be able to go pick up as much as they want. But some people have just little, just to satisfy their immediate customers. That is the situation. “These machines don’t run on water or air, they run on electricity or fuel, and those things are very expensive.” Saying the importation going on threatens the local industry, he describes it as a red flag to food production and affordability in the nearest future.
Farmers, according to him, will not to be on their farms in 2026 because of poor sales they are recording this year as less of rice paddy is bought by millers due to low consumption of local rice. “Farmers, we are not sure if they will go back to the farm after this harvest. “Yes, there is paddy, but if there is paddy, do we have the money to uptake it?
“If you have 50 metric tonnes of harvested paddy, and you want to uptake paddy, let us say, maybe 32 or up to 100 tonnes, but then do you really have the funds to go and uptake it? You don’t have the funds. “Except if you are in a lucrative position, where you have excess amount of money, or you are a salary earner, and you are earning a fantastic salary such that you will be able to uptake this rice.
“For example, minimum wage is N70, 000. Rice is going for N50, 000 and if you buy for N70, 000, how much do you have left? So, would you invest all your monthly salary to uptake rice? “No. So, the money is just not there, and this also impacts on the industry.
Those who are able to mill are not finding it easy”. ‘Reality’ The Chief Farmer of Africa and Representative of Youth in Agriculture, Jerry Olanrewaju, echoed Dama’s position as he welcomed the crash of rice prices but lamented that local producers of the commodity are not benefiting from the whole process. Olanrenwaju said: “About a year ago, the average price of a 50kg bag of rice ranged between ¦ 80,000 and ¦ 100,000, depending on the brand and location. “Today, that same bag sells for between ¦ 55,000 and ¦ 70,000 in most markets in Nigeria.
This represents a significant 30% to 45% price crash within one year.” According to him, while consumers may view this drop as a relief, the reality behind the price movement reveals deep structural issues within the rice value chain and the wider agricultural economy.
Besides the waiver granted to some importers to bring rice into the country which Dama stressed, he said the strengthening of the Naira and improved foreign exchange liquidity, among other factors, has reduced the landing cost of imported rice His words: “Several factors are responsible for this decline. “The strengthening of the Naira and improved foreign exchange liquidity has reduced the landing cost of imported rice. “At the same time, the influx of rice from neighbouring countries—much of it smuggled through unofficial borders— has increased supply beyond local demand.
“Reduced consumer purchasing power has also forced traders to lower prices in order to sell off existing stock. “Additionally, the ongoing dry-season harvest contributed more volume to the market, while earlier speculative pricing by traders has now corrected itself, leading to the current crash. “Unfortunately, local producers are not benefiting from this development. “Production and processing costs remain extremely high due to rising fertilizer prices, diesel costs, labour, transportation, and mechanization expenses. “As a rice farmer and processor producing D’More Rice, our cost of production continues to increase while market prices keep dropping. “This imbalance places local producers at a severe disadvantage, especially when competing against imported rice produced by farmers who are supported heavily by their governments”. ‘Deliberate, strategic actions’ The odds are stacked heavily against rice farmers and millers but Olanrewaju suggests the way out His words: “To protect the local rice industry, Nigeria must take deliberate and strategic actions.
“These include reducing production costs through subsidies on inputs, strengthening border controls to stop smuggling, and providing accessible, lowinterest financing for farmers and millers. “Stabilizing agricultural policies, investing in irrigation infrastructure, and supporting local rice mills to operate at full capacity are also essential. “Introducing a minimum support price for paddy could prevent farmers from selling at a loss during market downturns. “In conclusion, the current price crash is not sustainable.”
Meanwhile, Olanrenwaju warns, “If government does not address the root causes quickly, many local producers may be forced out of business, increasing Nigeria’s dependence on imported rice. “Supporting local rice farmers is not only an economic necessity—it is critical for national food security.” ‘Mixed bag’ For his part, the President of the Nigeria Agribusiness Group, NABG, Kabir Ibrahim, describes the situation in the rice subsector as a mixed bag. Ibrahim says: “What is happening today is a mixed bag of many things. Unless you bring down the cost of inputs, it will be very difficult for any farmer to go back to the farm because the purchasing power of the typical Nigerian is affected drastically by the value of the Naira. “So even if the price of rice is less than N50, 000, how many people can buy it? “The biggest problem is twofold – farmers are crying of poor prices, and the consumers are crying of high prices. “Even at that low price, it’s still high for the consumers because their salaries are fixed.
“The purchasing power of the Naira is not good, and you need to balance that. “You have to balance production and marketing to have seamless agribusiness.” PAGE 14 — SUNDAY VANGUARD, DECEMBER 21, 2025 According to him, following the price of rice going down, farmers and millers have been boxed into a corner, and possibly may not return to the farms. “Once one is low and the people doing that are complaining, then it doesn’t work at all because what it means is that these farmers who are complaining will not necessarily be there to produce it next year.” ‘Food inflation in 2026’ He projects that with the high cost of inputs and if nothing is done about it, inflation will get worse, saying this will be at the detriment of Nigerians.
“So there is a possibility of having (food) inflation next year. This is the obvious implication that if people are having lethargy in producing something; that means it will become scarce”, Ibrahim affirms. “And scarcity is a component of inflation because when there is low demand and there is high supply, you have deflation or you have a fair price. But when there is very high demand and low supply, you have inflation, you have high skyrocketing price.”
The NABG boss calls on the Federal Government to declare state of emergency on the prices of farming inputs to ensure a more sustainable way of keeping food production going and food prices at a low and affordable margin. His words: “We have a state of emergency on food prices now; you should also have a state of emergency on input prices. “Liberalize fertilizer, for instance. During the Buhari administration, we had the Presidential Fertilizer Initiative. In 2010, fertilizer was being sold at N5, 100. “Then during COVID, it became N5, 000, and fertilizer was available to Nigerians just like CocaCola. “The price in Abuja was the same thing as the price in my village.
“So, that’s the regime that we want and the price of fuel is high in terms of running the machine. “The price of fuel is causing a lot of problems in distribution. “Let us say, food system, every food system, depends on production, processing, distribution, storage, and even consumption. “So, high price of fuel will give rise to a high price of distribution such that if at Farmgate, you say you bought something for N10, 000 in Funtua, if you’re bringing it to Abuja, you have to add N3, 000 per bag, and then you must look at the person doing the business also to put their markup. “The noise in the public domain is that these food items are cheap, but the people producing them are not making noise, but they are taking decisions.
“It’s in the larger interest of government to intervene such that prices become low.” Price reduction does not reflect cost of production – AFAN leader The Chairman of the All Farmers Association of Nigeria, AFAN, Federal Capital Territory, FCT, Chapter, Dr Nkechi Okafor, also weighs in, lamenting the high cost of production in the rice value chain compared to the current price of rice in the market. Okafor says: “The cost of production is not going down but the price of produce is very down.
“The challenge now is that farmers are still buying inputs at an exorbitant prices including payment for labour, transportation, and security also gulps huge amount of money. “Meanwhile, their output, which is their produce, the price is very low that farmer may be sent out of production.” She points at the influx of rice through the land and sea borders “currently inflicting pain on rice farmers and leading to huge losses made in their investments locally to produce, feed Nigerians and make profit.
“The Federal Government has opened the borders, and rice is coming in, and those at the receiving end of these massive importations are local farmers”, Okafor adds. The AFAN leader who is also a rice farmer asks the Federal Government to look beyond importation and low prices of rice and other commodities but should come up with long lasting solutions.
“We appreciate them for the prices of the food but as they have done well to find a solution to make the prices of food come down, they should only work on the cost of production”, she pleads.
“As government is working on making food available, which is the prayer of everybody, farmers and consumers alike, they should only help us to work on the cost of production – fertilizer, chemical, access to finance, access to markets, among others.
“This will enable farmers produce at low cost, and will also sell at low prices instead of producing at a high cost and sell at a low price, it does not encourage farmers”.
‘Rice farmers need to do more’ In another response, the Chief Executive Officer, EA Daniel Farms, Daniel Ijeh, describes the coming down of the price of rice as a confirmation that there has been inefficiency in rice production. “We are seeing the price of rice coming down.
You may recall that in December 2024, the price of rice rose to N98, 000, and almost the same period in 2025, the price is N58, 000 which is 41% difference”, Ijeh tells Sunday Vanguard. “Rice production does not really need government’s intervention as people are calling for because government doesn’t have business with rice production, and if they are doing interventions, it is only promoting inefficiency”.
He argues that farmers need not depend on government to produce rice, but rather should apply best agricultural practices to compete with importers and prove their expertise in the business. “We don’t need to blame government for the price crash. Rice farmers in this country are to work hard to prove that they can change the narrative by bringing their expertise to the industry. “We don’t have producers, let them import”.
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