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$3 Billion Nigeria Bound Rice Stuck in Benin Republic

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Rice
  • $3 Billion Nigeria Bound Rice Stuck in Benin Republic

Rice worth over $3 billion meant for the Nigerian markets are said to be stuck in various warehouses in Benin Republic due to the federal government’s policy banning importation of the commodity through land borders and fierce customs anti-smuggling drive.

Findings revealed that the annual routine of importing rice into the neighbouring countries from July to December to make massive sales in Nigeria during yuletide has hit a brickwall as the Comptroller General of the Nigerian Customs Service (NCS), Col. Hameed Ali (rtd) has insisted that his men tighten the borders.

Nigeria shares major borders with Benin Republic at Seme Border (Lagos), Idiroko (Ogun State), Shaki (Oyo State),Chikanda (Kwara State) and other smaller openings. Prominent among them is Seme where the highest volume of trade and largest smuggling opportunity exists because of its easier access to Lagos, Nigeria’s commercial capital city.

Seme border, which hitherto was a major transit point for foreign rice importation and smuggling also became a no go area for the commodity as almost daily seizures of 50kg bags of it have taken a good portion of the government warehouse .

A competent source in Benin said that most of the warehouses where the bagged rice are kept before shipment into the country are now battling for space.

According to the source, who does not want his name in print, “some consignments of imported rice into the small West African country that had no space at the usual and popular stores were moved to makeshift storage areas and are exposed to rains, weevils and other unhygienic forms of storage.

The source said: “Popular warehouses no longer receive rice shipments as thousands of bags earlier delivered to them since July could not be evacuated into Nigeria as planned and as the usual case in previous years. Popular Cherika warehouse in Akpakpa near Cotonou with a capacity to hold 25,000 bags is fully loaded with Thailand rice with no hope of evacuating them into Nigeria except government relaxes its policy disallowing rice imports through border or customs softening their round the clock enforcement in Seme.

“Defezi warehouse close to the Cotonou Port with is filled with over 40,000 units of 50kg bags of Indian and Thailand rice. Defezi got occupied earlier due to its proximity to the port but was not evacuated as the owners could not risk entering Nigeria with it. Cica warehouse in Missebo area of the Cotonou outskirts that suffered lack of patronage in the past due to distance from Seme border and bad road presently have over 15,000 bags. Some are getting moulded, caked with their bags torn and quantity reduced while under storage in several odd arrangements endlessly awaiting shipment into Nigeria.”

Checks revealed that while hope of smuggling them into Nigeria gets dim by the day, there is a conscious efforts at attempting the smuggling of the commodity without using bags.

The unwholesome methods, our findings revealed, require pouring grains of rice into various compartments of vehicles like the booths, bonnets, inner part of the doors, under the seats and other spaces meant for spare tyres and tools.

Sources disclosed that attempts to try bringing in some hundreds of bags failed as the smuggling bags ended up inside the customs warehouse in Seme and Idiroko as seizures.

The seized rice, some of which are closed to expiring and unwholesome for human consumption have become bad and unqualified for donation to Internally Displaced Persons (IDP) camps as was done in the recent past.

Numbers made available by the NCS revealed that over 37,000 bags of rice have so far been seized in Seme and Idiroko between January and September 2016 with a recent clamp down on 13 vehicles at a go in the Ogun State area all laden with smuggled rice.

Nigeria Customs had in an October 2016 press statement reiterated government’s ban on rice importation through the borders. The statement signed by customs spokesman, Wale Adeniyi, reinforced its resolve to protect government’s attempt to improve local rice capacity.

According to him, ”We like to reiterate the position that importation of Rice remains banned through our Land Borders, and we have the commitment of Partner Government Agencies and Stakeholders to enforce this restriction. While this restriction is in force, Rice imports through the Ports are still allowed subject to payment of extant charges.”

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Markets

SEC To Ban Unregistered CMOs From Operating By Month End

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The Securities and Exchange Commission (SEC) says it will stop operations of Capital Market Operators (CMOs) that are yet to renew their registration on May 31, 2021.

This was contained in a circular signed by the management of SEC in Abuja on Monday.

On March 23, SEC had informed the general public and CMOs on the reintroduction of the periodic renewal of registration by operators.

The commission noted that the reintroduction of the registration renewal was due to the need to have a reliable data bank of all the CMOs registered and active in the country’s capital market.

“To provide updated information on operators in the Nigerian Capital Market for reference and other official purposes by local and foreign investors, other regulatory agencies and the general public, to increasingly reduce incidences of unethical practices by CMOs such as may affect investors’ confidence and impact negatively on the Nigerian Capital Market and to strengthen supervision and monitoring of CMOs by the Commission,” SEC explained.

According to the circular, the commission said CMOs yet to renew their registration at the expiration of late filing on May 31, would not be eligible to operate in the capital market.

It explained that CMOs were required to have completed the renewal process on or before April 30, however, the commission said late filing for renewal of registration would only be entertained from May 1 to May 31.

SEC also said that asides from barring the CMOs who failed to comply accordingly, their names would be published on its website and national dailies.

It added that names of eligible CMOs would be communicated to the relevant securities exchanges and trade associations.

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Crude Oil

A Threat to Revenue As Nigeria’s Largest Importer of Crude, India slash Imports By $39.5B

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Crude oil

Nigeria’s revenue earning capacity has come under threat following the reduction of importation of crude oil by India.

India, Nigeria’s largest crude oil importer, reduced crude oil imports by $39.5bn in April, compared to the same time the previous year, data from India’s Petroleum Planning & Analysis Cell showed.

According to the Indian High Commission in Nigeria, India’s crude oil imports from Nigeria in 2020 amounted to $10.03bn.

This represented 17 percent of Nigeria’s total crude exports for the year according to the Nigerian National Petroleum Corporation, as quoted by OilPrice.com.

As Nigeria’s largest importer of crude oil, lockdowns in India’s major cities from the COVID-19 surge in April had ripple effects on Nigeria’s oil sales.

The NNPC was prompted to drop the official standard price of its main export streams, Bonny Light, Brass River, Erha, and Qua Iboe, by 61-62 cents per barrel below its April 2021 prices. They traded at $0.9, $0.8, $0.65, $0.97 per barrel respectively, below dated Brent, the international benchmark, as Oilprice.com showed.

India had been buying the not-too-light and not-too-heavy Nigerian crudes that suited its refiners.

Reuters reported that the Indian Oil Corporation’s owned refineries were operating at 95 percent capacity in April, down from 100 percent at the same time the previous month.

An official at the IOC was quoted as saying, “If cases continue to rise and curbs are intensified, we may see cuts in refinery runs and lower demand after a month.” Hundreds of seafarers risked being stuck at sea beyond the expiry of their contracts, a large independent crude ship owner reportedly told Bloomberg.

India reportedly bought more American and Canadian oil at the expense of Africa and the Middle East, reducing purchases from members of the Organisation of the Petroleum Exporting Countries to around 2.86 million barrels per day.

This squeezed the group’s share of imports to 72 percent from around 80 percent previously, as India’s refiners were diversifying purchases to boost margins, according to Reuters.

India also plans to increase local crude oil production and reduce import expenses as its population swells, according to Bloomberg.

A deregulation plan by the Narendra Modi-led government to boost national production to 40 million tonnes of crude oil by 2023/2024, an increase of almost eight million tonnes, had already been initiated.

According to Business Today, an Indian paper, the country currently imports 82 percent of its oil needs, which amounted to $87bn in 2019.

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Energy

Invest Africa and DLA Piper Partner to Support ESG Best Practice in African Renewable Energy Projects

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Invest Africa - Investors King

The global law firm, DLA Piper, has partnered with Invest Africa, the leading trade and investment platform for African markets, to support the development of ESG best practice in African renewable energy projects.

Clear Environmental, Social and Governance (ESG) targets and measurements have become an increasingly important part of fundraising as investors seek to align their portfolios with sustainable growth. For a continent boasting ample natural resources, this presents a significant opportunity for Africa’s green energy sector. However, renewable does not always equal sustainable and developing and articulating ESG metrics can pose a significant challenge to projects as they prepare investment rounds.

The project will assemble experts from the worlds of impact investment, development finance and law. Across a series of online meetings, participants will discuss strategies to improve ESG practices in African renewable projects from both a fundraising and operational perspective.

Amongst those speaking in the inaugural session on Thursday 13th May are Cathy Oxby, Chief Commercial Officer, Africa GreencoDr. Valeria Biurrun-Zaumm, Senior Investment Manager, DEGOrli Arav, Managing Director – Facility For Energy Inclusion (FEI) – Lion’s Head Global PartnersBeatrice Nyabira, Partner, DLA Piper Africa, Kenya (IKM Advocates) and Natasha Luther-Jones, Partner, Global Co-Chair of Energy and Natural Resources, International Co-Head, Sustainability and ESG, DLA Piper.

Veronica Bolton-Smith, COO of Invest Africa said, “Africa is particularly vulnerable to the impact of climate change despite contributing very little to global emissions. As the price of renewables fall, they will form an ever more important part of Africa’s electrification. In this context, it is essential that projects be given the tools to apply best practice in ESG not only from an environmental perspective but also in terms of good governance, fair working conditions and contribution to social inclusion. I look forward to working closely with DLA Piper on this important topic.”

Natasha Luther-Jones, Global Co-Chair Energy and Natural Resources and International Co-Head Sustainability and ESG at DLA Piper also commented, “Climate change is one of the biggest challenges companies, and people, face today and when we look at its reduction – whether that be in how we power our devices, what we eat or how we dress, where we live or how we work – all roads come back to the need to increase the amount of accessible, and affordable, clean energy. However, renewable energy companies are not automatically sustainable as sustainability is a focus on all ESG factors, not just environmental. We know the need for renewable energy is only going to continue to rise, and therefore so will the number and size of renewable energy companies. The additional challenge is to make sure they are truly sustainable organisations and that’s what we’re excited about discussing during the webinar.”

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