Rice prices double as cost of living worsens in Nigeria

NIGERIA – Data from the National Bureau of Statistics (NBS) indicates that the average price per kilogram of local rice sold in bulk reached approximately 1,022 naira (US$0.65) during the past month, double the rate a year ago.

Rice is the second most consumed cereal after corn in Nigeria.  The country, which produces around 70% of its consumption, imported more than $2.3 billion worth of rice in 2022 to meet its needs, according to data compiled on the Trade map platform.

According to  NBS report, over the same period, the tariff for broken rice increased by more than 95% to 1,107 naira ($0.70) while the price of imported rice increased by 78% to 1,322 naira (US$0.84). 

This sharp increase in rice prices on the local market is part of an economic context marked by an increase in annual inflation, which reached 29.9% in January 2024, its highest level in 28 years. 

Food inflation, the main driver of this growth, on the other hand, reached 35.41% in January, compared to 24.32% a year earlier.

The data marries with a recent prediction by AFEX, a leading commodities market player that maize and paddy rice prices would increase by 25% and 40%, respectively in Nigeria in 2024.

The forecast was contained in the report released on Wednesday, January 25 in Lagos.

The report noted that the price of maize in Nigeria has been highly volatile, reaching a high of N550,000 (US$612) per metric tonne in the third quarter of 2023, before falling to N480,000 (US$534) per metric tonne by the end of the year. 

The increase was attributed to reduced input usage and the impact of the Russia-Ukraine crisis on fertiliser prices.

On the global scene, the report said, Predictions for 2024 global commodity prices suggest a downward trend due to factors such as improved supplies and the expiration of certain trade policies.

However, the direction of this trend can be significantly influenced by numerous factors, each capable of either posing a downside or upside risk to commodity prices.

“Energy prices are expected to drop by five per cent in 2024 and then further decrease by 0.7 per cent in 2025, while agriculture commodities are projected to decrease by two per cent in 2024 and three per cent in 2025, provided that the Middle East conflict de-escalates.”

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