The cost of a 50kg bag of rice has fallen to around N58,000 in several parts of Nigeria, particularly in remote areas, according to a new report by S&P Global.
This development comes amid a surge in rice imports flowing in from the Republic of Benin.
S&P Global’s findings reveal that the West African parboiled rice market has sunk to its lowest point in nearly two years, largely due to the massive influx of supply after India scrapped export duties on parboiled rice.
Consequently, the price of a 50kg bag of rice has tumbled from highs of N80,000 to N58,000, fueled by the steady entry of Indian rice into Benin Republic and its subsequent movement into Nigeria.
Citing insights from Platts, a division of S&P Global Commodity, the report noted that Benin’s warehouses have been filled to capacity with the lower-cost rice from India, as confirmed by several market sources.
Between September and December last year, India exported about 2.11 million metric tonnes of parboiled rice to West Africa, a massive leap from the 720,000 metric tonnes recorded in the same period of 2023.
Over the course of 2024, total exports from India to the region reached 5.35 million metric tonnes, up from 3.9 million metric tonnes in 2023, according to the Agricultural and Processed Food Products Export Development Authority.
Speaking to the current market mood, a trader based in Togo remarked, “The current situation in almost every region of West Africa is the same, quiet and bearish.”
Nigeria, being the primary destination for rice imports into Benin, has seen a sharp drop in both locally-produced and imported rice prices over the past fortnight.
Reports indicate that the price of local rice has declined from between N80,000 and N90,000 to N60,000, while imported Indian rice now sells for around N80,000.
“Despite the price decline, demand has not risen correspondingly. With prices continuing to slide daily, buyers are adopting a cautious approach, waiting for stabilisation before making purchases,” the report added.
Another trader operating from Benin suggested that demand may only pick up when preparations for the Christmas season commence around September.
Field reports also highlight Nigeria’s significant role as the main consumer of rice funneled through Benin Republic. In some border towns in Ogun State, the price of a 50kg bag of rice has dropped below N50,000, thanks to their closeness to Benin.
Even with the federal government’s ban on rice importation still in place, rice remains the most smuggled product into Nigeria, leaving the Nigerian Customs Service grappling with the relentless challenge of intercepting smugglers.
