The United States Department of Agriculture (USDA) report which asserted that Nigeria will be the second-largest importer of rice in 2019 has been found to be grossly inaccurate, according to BusinessDay’s analysis of export data involving over 150 countries. Findings show that not only did the USDA make inaccurate assertions in its estimation of Nigeria’s rice imports; it also got it wrong with several other countries’.
The analysis is based on exports data from Thailand and India, which both account for nearly half of global rice exports. India’s 2017-18 non-basmati rice exports stood at 8,633,237 metric tonnes, while basmati rice export is put at 4,051,896 according to data from the website of All India Rice Exporters Association (AIREA). The data was further denoted to have been sourced from India’s Directorate General of Commercial Intelligence and Statistics (DGCIS).
On the other hand, data on the website of the Thailand Rice Exporters Association showed that 11,674,331 metric tonnes of rice was exported to 185 countries in 2017, and as at September 2018, exports across the world stood at 8,121,579 metric tonnes.
For Nigeria, the USDA claimed the country imported 2.1 million metric tonnes of rice in 2015/16; 2.5 million metric tonnes in 2016/17; and 2.6 million metric tonnes in 2017/18, with projected import of 3 million metric tonnes of rice in 2018/19. This is however false, at least going by export data from Thailand and India, which were Nigeria’s largest rice suppliers before the country stiffened rice importation.
For instance, at the end of 2017, exports to Nigeria from both countries were cumulatively 63,605.72 metric tonnes, whereas the USDA claims Nigeria imported 2.5 million metric tonnes in its October 2018 report titled, “Grain: World Markets and Trade.” The difference of 2.43 million metric tonnes simply cannot be accounted for, especially not by the USDA whose data gathering process is unknown. Emails seeking clarification on data sources, sent to the press unit of USDA, as well as three personnel: Rachel Trego, Nicole Podesta, and Andrew Sowell were not replied at the time of publication.
Since 2015, rice importation through the borders has been banned in Nigeria, and while it remains permissible through the ports in the spirit of world trade, it attracts an import duty of 70 percent. This has effectively eroded the motivation for those who were erstwhile rice importers; the impact of this is reflected in the constantly declining volume of rice exported to the country. Rice coming through the land borders is smuggled; illegally brought in for consumption, which in reality augments inadequate local production. However, no data exists anywhere capturing this volume, much less the unsubstantiated claims by the USDA.
“The figures are completely overstated, especially when the increasing investments in local rice production are considered,” said Tunji Owoeye, managing director, Elephant Group Plc, who is also Chairman, Rice Investors Group of Nigeria.
Nigeria’s rice imports from Thailand have been declining in the last four years, and as at September 2018, data by the Thailand Rice Exporters Association shows that only 5,161 metric tonnes of rice has been exported to Nigeria. For the full year 2017, volume of rice exported to Nigeria was 23,192 metric tonnes, a reduction from 58,260 metric tonnes in 2016. This was an even bigger decrease from 644,131 metric tonnes of rice exported to Nigeria in 2015.
On the other hand, Nigeria’s shipments from India have also been declining. The country had 3,443 metric tonnes of both basmati and non-basmati rice shipped from India in 2017/2018; a decline from 40,413.72 metric tonnes shipped to Nigeria in 2016/2017, which was itself a decline from 53,796.05 metric tonnes in 2015/2016.
However, while the USDA has ranked Nigeria high on rice importation, and projects it to be the second-largest importer by 2019, going by 2018 exports data, Nigeria with 5,161 metric tonnes of rice ranks 78th on Thailand exports to 185 countries. Furthermore, with 3,443 metric tonnes, Nigeria ranks 68th in India’s exports to 159 countries.
Further analysis of the data from Thailand rice exports to West Africa, shows that Nigeria ranks 12 out of the region’s 16 countries. On India rice exports, Nigeria ranks 14 out of the 16 countries in West Africa.
Other flaws and implications for Nigeria
Apart from the unsubstantiated estimates attributed to Nigeria by the USDA, a major flaw could be seen in the figures attributed to some other countries.
Nigeria’s neighbour, Benin Republic, remains the highest importer of rice from Thailand, not only in West Africa, but the world with 1,144,001 metric tonnes already exported there as at September 2018. Benin imported 1,814,014 metric tonnes from Thailand in 2017 and 1,427,098 metric tonnes in 2016. The volume of rice exported to Benin has continued to increase, even though Nigeria’s imports have been decreasing.
In non-basmati rice, which has the highest volume of exports from India, Benin Republic occupies the second position in West Africa, importing 778,920 metric tonnes in 2017/18, an increase from 702,181.65 metric tonnes recorded in 2016/17, and 623,348.2 metric tonnes in 2015-16.
However, Benin Republic according to the USDA imported 450,000 metric tonnes of rice in 2015/16, 525,000 metric tonnes in 2016/17, and 550,000 metric tonnes in 2017/18 with a projection of 650,000 metric tonnes for 2018/19.
A simple addition of the exports from Thailand and India alone shows that 2.05 million metric tonnes of rice were exported to Benin in 2016, against 450,000 metric tonnes the USDA claims. The USDA figure only represents 21 percent of what Benin imported from just Thailand and India; its total imports understated by at least 79 percent.
Also, whereas exports to Benin in 2017 was at least 2.51 million metric tonnes from India and Thailand alone, the USDA stated the country had a total import of 525,000 metric tonnes.
Cameroon, another country which shares borders with Nigeria, had 47,345 metric tonnes of rice shipped to it from India in the 2017-2018 period, 48,260.75 metric tonnes in the 2016-2017 period, and 85,655.86 metric tonnes in 2015-2016. From Thailand, Cameroon had a shipment of 280,872 metric tonnes of rice as at September 2018, while in 2017 a total of 749,008 metric tonnes was shipped, and 505,254 metric tonnes in 2016.
The USDA stated that Cameroon imported 500,000 metric tonnes of rice in 2015/16, increasing to 600,000 metric tonnes in 2016/17, and 650,000 metric tonnes in 2017/18. The country is projected to import 700,000 metric tonnes of rice in 2018/19.
However, from just two countries; India and Thailand alone, 797,268.75 metric tonnes of rice were exported to Cameroon in 2017, which is almost 200,000 tonnes more than the figure indicated for the country by USDA. A similar discrepancy exists in the 2016 estimate, and even though the figure may look marginal, the fact that exports from only two countries far exceed USDA’s total import data leaves much to be desired.
Cameroon’s estimates may appear passable, but that of Benin Republic, and especially Nigeria suggest a highly distorted data released to the international community by the USDA.
The potential damage of such misleading data for Nigeria is enormous considering that in the last three years, there have been multi-million dollar investments as the country which aims for self-sufficiency in rice production. Even though the local production of rice is yet to attain a level where it is abundantly available, inaccurate information suggesting the country will throw its ports open to a volume of ‘legal’ imports which has not been seen in over five years, is capable of discouraging potential investors.
In the last three decades when Nigeria suddenly relied on massive importation of rice, many erstwhile farmers abandoned their farms, as their production could not make any realistic market. In addition, those who had grown businesses around milling rice paddy were affected.
Akai Egwuonwu, CEO, Anambra Rice Limited had told BusinessDay during a visit to his mill in Amichi, Anambra state that, after the mill commenced operation in 2008, it was shut down after a year (in 2009) till 2012 due to “excess importation of foreign rice that we cannot compete against.”
The report by the USDA would only have brought back such scary memories to local producers such as Egwuonwu , who are only just getting the courage to go back to production.