Nigerian Rice Industry Crumbles as Imports Hit N51bn

Nigeria spent N51 billion ($34.4 million) on foreign rice in 2024, signaling a sharp reversal of the self-sufficiency gains claimed by the previous administration. Data from UN Comtrade confirms that local rice has become uncompetitive against cheaper imports. High production costs and expensive energy are pricing Nigerian farmers out of their own market. President Bola Tinubu’s food security agenda now faces a significant hurdle as the sector contracts.

Farmers in key regions like Kebbi and Jigawa are abandoning their fields in record numbers. In Kebbi, less than 30 percent of rice fields were cultivated last year as growers switched to hardier grains like sorghum. The lack of demand for local paddy stems from a massive wave of mill closures across the country. Farmers cannot find buyers for their harvests because the processing middleman has disappeared.

Over 90 rice mills have shut down operations because they cannot compete with the price of foreign grain. Small-scale millers are particularly vulnerable to the rising costs of diesel and high interest rates on loans. The Rice Millers Association of Nigeria warns that the local industry is on the brink of collapse. Most surviving mills operate with massive unutilised capacity, which drives up their overhead costs per bag.

Nigeria currently faces a shortfall of 6.2 million metric tons of paddy to meet domestic demand. While the country needs 11 million metric tons of paddy, it produces only 4.8 million. This gap is being filled by both legal imports and a surge in smuggling through porous borders. Benin and Togo collectively spent nearly $800 million on rice imports last year, much of which likely crossed into Nigeria illegally.

The federal government’s decision to grant import waivers on essential goods has created a policy paradox. While the duty-free window eased the pressure on food inflation for consumers, it effectively squeezed the margins of local producers. Farmers now describe rice cultivation as a loss-making venture. Without a competitive edge, the massive investments made in milling infrastructure over the last decade sit idle.

Agricultural experts fault the current trade policy for prioritising short-term price stability over long-term industrial growth. The Rice Processors Association of Nigeria notes that the industry has the capacity to process 7.5 million metric tons if the environment were stable. Instead, the influx of cheaper foreign brands is making it impossible for local brands to stay on shelves. Nigeria is effectively outsourcing its food security to foreign exporters.

The collapse of the rice value chain threatens to undo years of rural development and job creation. If the government does not address the high cost of inputs and energy, the transition away from rice will become permanent. A country that cannot feed itself remains at the mercy of global price shocks and currency fluctuations. The N51 billion spent on imports is more than a fiscal drain; it is a sign of a domestic industry in retreat.