Connect with us

Markets

FG: Rice Could Sell for N40,000 by December Unless Production Expands

Published

on

Rice

The federal government at the weekend warned that unless Nigerians ramp up the production of rice, a major staple in the country, and take advantage of current agricultural policies, the product could sell for as much as N40,000 a bag by December.

The government noted that with over 3.5 million tonnes deficit in the national supply of rice, there was the dire need to put emergency measures in place to curb the rising price of the commodity, disclosing that President Muhammadu Buhari already ordered an unfettered access to his office to discuss the way forward  as part of measures to reverse the trend.

The Minister of State for Agriculture and Rural Development, Senator Heineken Lokpobiri, who spoke during a town hall meeting with farmers and other stakeholders in Bayelsa State, maintained that the $22billion spent annually on the importation of food was adversely affecting the economy, given that the dollars to import the product was no longer available.

The minister, who also visited some privately-owned farms in the state, with a view to partnering them in agricultural production, noted that the situation was even scarier with the recent  projection that by 2050, Nigeria’s population would have increased to 450 million.

“We were told that our population will be 450 million by the year 2050, that is 34 year from now, that is, our population will be three times this number and if we cannot feed ourselves now, how do we feed ourselves in the next 34 years.

“We have to start today, not just in production but on the entirely value food chain. Those growing the crops will only get 20 per cent of the entire food value, but those in other value chains like processing, marketing get the huge part of the value than those who are actually planting the crops.

“For your information, we spend $22 billion a year importing food into Nigeria. We don’t have any more dollars to import. That is why you see the price of rice going higher.  A bag of riwas 12,000 some months ago, but now it’s 26,000 and if we don’t start producing, by December it could be N40,000,” the minister warned.

Lokpobiri disclosed that since rice matures in three months, it was not too late for farmers to take advantage of the scarcity as there still remains a huge market for the product in the Nigerian market.

“The government has four farms in the state in our records. The average land you see in Bayelsa can grow rice, so the colonial masters were not wrong in their assessment when they said Niger Delta could feed not only the Nigerian but also the entire West Africa sub-region.

“Unfortunately, agriculture till today, is not a priority of the Niger Delta as far as the state governments are concerned because of oil,” he lamented.

He said the states in the Niger Delta had yet to give priority to agriculture the way the North-west states such as Kebbi, Jigawa, Kano as well as other states like Lagos, Ebonyi, Anambra, prioritised it, stressing that Anambra State was not owing salaries even without oil.

The minister was at the one-day interactive session with many agric supporting agencies, including the West Africa Agricultural Productivity Programme, WAAPP, which he said brought along about 3,000 disease-resistant stems of cassava and 8,500 improved yam seedling for Bayelsa State  farmers.

He decried the destruction of the region’s resources by militants, noting that agriculture was one sure way of discouraging militancy.

“The only way we can take our people out of militancy is actually through agriculture and this is also an opportunity to tell our people that the most important resources to any man is land and water resources.

“By the time you are blowing up pipelines, you are actually damaging the water resources. Today,  people say it will take 20 years to clean up Ogoni and we are blowing up our pipelines.

“We are the people suffering from our own decision, from our own wrong action. So, the time has come for change from blowing up pipelines as a way of drawing attention  to constructive engagement.

“There is no point for anybody to blow up pipelines, after all, you are killing the fishes in the river, you are doing more damage to our ecosystem. I want to use the opportunity to appeal to our youths to desist from destroying their own resources.

“The water resources around the environment are not even enough, so if you destroy them, you are destroying your own resources,” he said.

In his comments during the session, the President, Ijaw Youth Council Worldwide (IYC), Mr. Udengs Eradiri, said agriculture remained the sure way of taking Nigeria out of the security and economic challenges confronting her.

He said for the government to be able to woo people into agriculture, the farmers should be given adequate incentives, insisting the real farmers, not portfolio farmers, should be empowered with processing and storage facilities to give value to their produces.

“Give the fishermen, for instance, the right incentive. We have a big problem in the Niger Delta.  Agriculture is the sure way to solve the Niger Delta crisis. It is multidimensional.  If the Ministry of Agriculture, with all the stakeholders put their machinery together properly,  we can use it to solve the Niger Delta crisis.

“Young people are ready, it is just that with politics, blackmail and all that, people are discouraged. But we need to put the right machinery in motion.

“Brass fertiliser is very important to us. Government should look at the project and give the final support necessary so that the agric sector will have a lot of fertiliser from the oil and gas.

“And this will create a lot of jobs and these crises will be minimised. Agriculture is where the world is going now. The richest nations in the world are agro-based nations but they use their brains properly with technological inputs to drive the process,” Eradiri argued.

The Chief Executive Officer, Achievers Farms Limited, Dr. Jonathan Omu, said access to capital remained a critical problem confronting farmers in the country.

Omu added that even when the banks gave  loans, they usually gave loans that were  grossly inadequate, saying it was high time they started taking banks that refused to give loans to farmers to court.

Other supporting agencies and institutions whose officials attended the event with the minister, aside WAAPP, were the Bank of Industry (BoI), Bank of Agriculture (BoA), Nigerian Agricultural Insurance Corporation (NAIC) and the Nigerian Incentive-based Risk Sharing System for Agricultural Lending (NIRSAL).

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

Continue Reading
Comments

Crude Oil

Dangote Mega Refinery in Nigeria Seeks Millions of Barrels of US Crude Amid Output Challenges

Published

on

Dangote Refinery

The Dangote Mega Refinery, situated near Lagos, Nigeria, is embarking on an ambitious plan to procure millions of barrels of US crude over the next year.

The refinery, established by Aliko Dangote, Africa’s wealthiest individual, has issued a term tender for the purchase of 2 million barrels a month of West Texas Intermediate Midland crude for a duration of 12 months, commencing in July.

This development revealed through a document obtained by Bloomberg, represents a shift in strategy for the refinery, which has opted for US oil imports due to constraints in the availability and reliability of Nigerian crude.

Elitsa Georgieva, Executive Director at Citac, an energy consultancy specializing in the African downstream sector, emphasized the allure of US crude for Dangote’s refinery.

Georgieva highlighted the challenges associated with sourcing Nigerian crude, including insufficient supply, unreliability, and sometimes unavailability.

In contrast, US WTI offers reliability, availability, and competitive pricing, making it an attractive option for Dangote.

Nigeria’s struggles to meet its OPEC+ quota and sustain its crude production capacity have been ongoing for at least a year.

Despite an estimated production capacity of 2.6 million barrels a day, the country only managed to pump about 1.45 million barrels a day of crude and liquids in April.

Factors contributing to this decline include crude theft, aging oil pipelines, low investment, and divestments by oil majors operating in Nigeria.

To address the challenge of local supply for the Dangote refinery, Nigeria’s upstream regulators have proposed new draft rules compelling oil producers to prioritize selling crude to domestic refineries.

This regulatory move aims to ensure sufficient local supply to support the operations of the 650,000 barrel-a-day Dangote refinery.

Operating at about half capacity presently, the Dangote refinery has capitalized on the opportunity to secure cheaper US oil imports to fulfill up to a third of its feedstock requirements.

Since the beginning of the year, the refinery has been receiving monthly shipments of about 2 million barrels of WTI Midland from the United States.

Continue Reading

Crude Oil

Oil Prices Hold Steady as U.S. Demand Signals Strengthening

Published

on

Crude Oil - Investors King

Oil prices maintained a steady stance in the global market as signals of strengthening demand in the United States provided support amidst ongoing geopolitical tensions.

Brent crude oil, against which Nigerian oil is priced, holds at $82.79 per barrel, a marginal increase of 4 cents or 0.05%.

Similarly, U.S. West Texas Intermediate (WTI) crude saw a slight uptick of 4 cents to $78.67 per barrel.

The stability in oil prices came in the wake of favorable data indicating a potential surge in demand from the U.S. market.

An analysis by MUFG analysts Ehsan Khoman and Soojin Kim pointed to a broader risk-on sentiment spurred by signs of receding inflationary pressures in the U.S., suggesting the possibility of a more accommodative monetary policy by the Federal Reserve.

This prospect could alleviate the strength of the dollar and render oil more affordable for holders of other currencies, consequently bolstering demand.

Despite a brief dip on Wednesday, when Brent crude touched an intra-day low of $81.05 per barrel, the commodity rebounded, indicating underlying market resilience.

This bounce-back was attributed to a notable decline in U.S. crude oil inventories, gasoline, and distillates.

The Energy Information Administration (EIA) reported a reduction of 2.5 million barrels in crude inventories to 457 million barrels for the week ending May 10, surpassing analysts’ consensus forecast of 543,000 barrels.

John Evans, an analyst at PVM, underscored the significance of increased refinery activity, which contributed to the decline in inventories and hinted at heightened demand.

This development sparked a turnaround in price dynamics, with earlier losses being nullified by a surge in buying activity that wiped out all declines.

Moreover, U.S. consumer price data for April revealed a less-than-expected increase, aligning with market expectations of a potential interest rate cut by the Federal Reserve in September.

The prospect of monetary easing further buoyed market sentiment, contributing to the stability of oil prices.

However, amidst these market dynamics, geopolitical tensions persisted in the Middle East, particularly between Israel and Palestinian factions. Israeli military operations in Gaza remained ongoing, with ceasefire negotiations reaching a stalemate mediated by Qatar and Egypt.

The situation underscored the potential for geopolitical flare-ups to impact oil market sentiment.

Continue Reading

Crude Oil

Shell’s Bonga Field Hits Record High Production of 138,000 Barrels per Day in 2023

Published

on

oil field

Shell Nigeria Exploration and Production Company Limited (SNEPCo) has achieved a significant milestone as its Bonga field, Nigeria’s first deep-water development, hit a record high production of 138,000 barrels per day in 2023.

This represents a substantial increase when compared to 101,000 barrels per day produced in the previous year.

The improvement in production is attributed to various factors, including the drilling of new wells, reservoir optimization, enhanced facility management, and overall asset management strategies.

Elohor Aiboni, Managing Director of SNEPCo, expressed pride in Bonga’s performance, stating that the increased production underscores the commitment of the company’s staff and its continuous efforts to enhance production processes and maintenance.

Aiboni also acknowledged the support of the Nigerian National Petroleum Company Limited and SNEPCo’s co-venture partners, including TotalEnergies Nigeria Limited, Nigerian Agip Exploration, and Esso Exploration and Production Nigeria Limited.

The Bonga field, which commenced production in November 2005, operates through the Bonga Floating Production Storage and Offloading (FPSO) vessel, with a capacity of 225,000 barrels per day.

Located 120 kilometers offshore, the FPSO has been a key contributor to Nigeria’s oil production since its inception.

Last year, the Bonga FPSO reached a significant milestone by exporting its 1-billionth barrel of oil, further cementing its position as a vital asset in Nigeria’s oil and gas sector.

Continue Reading
Advertisement




Advertisement
Advertisement
Advertisement

Trending