Faced with just N500million monthly to address the challenges of governance, infrastructure and other capital projects, Ebonyi State government had no choice but to redirect the people to the farms as a survival strategy in this recession period. The state commissioner for Information, Senator Emmanuel Onwe took journalists down the route of the rice farms revival efforts.
The beginning of the rice revolution
It’s been such a great narrative about how Nigeria needs to diversify its economy. We took that to heart. Ebonyi has nothing else going for it other than allocation from the centre and we realise that allocation from centre is dwindling. In the month of April, Ebonyi got only N450m There was a time Ebonyi used to receive N6b. Former governor, Martin Elechi had an average income of N5.5b throughout the period of eight years he was in power. That is verifiable. The current government has an average of N2.1bn and of that; N1.6bn goes to overheads, subvention to universities, Colleges of Education, general hospitals and so on.
Incidentally, we have a governor who is very interested in infrastructure given the fact that he is an engineer. But beyond being an engineer, Abakaliki hasn’t had a capital until the current effort that is being made. In the last 18 months, he has constructed about 250km of roads within the urban areas. But it quickly dawned on us that allocations might end tomorrow and if it did, Ebonyi is one of those states identified as probably not viable once allocation ends. Because of our peculiar history, the possibility of returning to a situation whereby Ebonyi is part of a larger political entity where nothing happens in that section and those here from the South- East will probably understand that Ebonyi basically has been the weeping child of the South East since the period we had Eastern region.
So, one of the fascinating stuff that happened was that there was a troubling headline about the governor of Ebonyi and EFCC recently. I chose to ignore that until there is this other headline that a bag of rice sells for N8,000 in Ebonyi state. That is true in one sense depending on the type of rice and the stage of processing you are talking about. If it is unprocessed rice because when the CBN Governor and the Chairman of Presidential Task Force on Rice Production and the Minister of Agriculture visited Ebonyi last week, they went to a very large farm complex, which is basically the centrepiece of Ebonyi rice production. The local farmers made a case that with the assistance of the Anchor Borrower Scheme that the CBN is doing, Ebonyi was able to borrow certain amount of money and gave to farmers by way of inputs like fertilizers, herbicides and grains. They said rice is now moving from N5, 000 to N8,000 per bag. He was talking about unprocessed paddy rice, which will normally yield eight barns.
In Ebonyi, state, the price is between N6,500 to N9,000. Two of those will make 50kg. 50kg of rice from Ebonyi is between N13,000 and N18,000 depending on the quality. We wanted to follow up on that. It happens that right now, we are harvesting. Ebonyi is making the largest proportion of its harvest of rice since history. That was possible because the government borrowed N2b from CBN, bought about 50 tractors and gave to Cooperative Societies and individuals who have the capacity to produce. I own a rice farm of about 100 hectares, which I am also harvesting right now. The challenge was to break the jinx of not being able to harvest up to 4,5,6 metric tonnes of rice per hectare. We are doing that right now which is why I’m confident that by the end of harvest season this year, Ebonyi would have reached the mass of production that will satisfy local needs. If we are successful in the dry season farming we are trying to embark on from December to April, we would have satisfied local needs and then be able to saturate selected markets in Lagos, Port Harcourt and Abuja with Ebonyi rice. One positive thing today is that Ebonyi rice, which used to be called Stoneville or Stonefest, has changed. If you eat Ebonyi rice today and you encounter stone in the rice, then forget about it.
Relationship between Ebonyi and Kebbi rice production
Across the country, Kebbi state is doing extremely well. Kebbi state is a very large state in terms of its landmass and its potentials. The difficulty they have is a very limited rainfall, which is about 2.5mm of rainfall. In Ebonyi, we have about 4mm; but Ebonyi is only about 4,500 square kilometers while for a state like Kebbi, it is up to 18,000 square kilometers. This means Ebonyi can fit into Kebbi state three, four times. Therefore, they have a much larger disposable and cultivable land for rice.
But I think the advantage we have is our rice does not require much of fertilizer.
You may have seen some news spreading in the social network about some people in China using plastic to produce pellets as rice. How true that is, I have no idea but the truth is most of the rice imported to Nigeria has been in storage for about 10 years. Such rice cannot be good for local consumption. Ebonyi has the record of being the only state in this country to produce organic rice. The price may be premium but why spend money buying food supplements when actually you can eat healthy? That is why Ebonyi state governor has banned the sale and consumption of foreign rice.
Impact on employment drive in the state
Very positive. I will use a personal experience. I use a combination of mechanisation and direct labour on my farm. From the process of clearing the bush, tilling the land, transplanting and broadcasting of rice, application of fertilisers and the harvesting, which are ongoing now. But above all, we concentrated in employing local labour to do that. As at last week Friday, 3,000 people have worked on my farm and that has happened across all the farms in Ebonyi state, including the governor’s own farm. Every member of the Ebonyi state cabinet has at least two hectares of rice farm. It was made compulsory. All portions of land that were lying fallow were distributed to cabinet members and that was to give impetus to all citizens to buy into the idea of rice cultivation because if the governor is doing it, if the commissioners are doing it, then there should be no reason why everybody else is not doing it. Youth unemployment is being reduced.
N250,000 was made available for about 7,000 youths and women to participate by way of soft loans through the N2b loan that the state government got from CBN at an interest of about nine percent. The government has taken responsibility of paying the nine percent. The CBN economics of rice production is N248, 000 per hectare. So, we gave N250,000 per farmer. The additional money on top of the N250, 000 is for ongoing maintenance because rice production is a very tedious process. You have to clear the bush. You have to till the bush. You have to do a nursery where you first broadcast rice that you transplanted on the field after tilling it. Then, you weed. After that you apply NPK fertiliser. After two weeks, you apply Urea fertiliser. You weed again and then you ensure that you take measures to prevent pest, especially birds. Then you harvest and thresh and bag. After that you parboil. The parboiling process is one of the most convoluted processes one can think about. You put quantity of rice in a big drum overnight. The next day you pour it out and then put it in the same drum. This time, you do not fill it with water until the steam comes out. Then you dry it, bag it again. You then take it to the processing mill where ultimately the chaffs are removed and you have your grain rice. That is so labour intensive. By the time you’ve done all of that, at least 20 people will be involved in the processing of 100kg of rice.
We don’t have farmer’s congress. Farmer’s congress is just another bureaucratic organ that will completely kill the whole thing. It is like a trade union. But we have Cooperative Societies. In every ward, we have at least 10 Cooperative Societies. It’s a good policy the CBN set up; that is they can only disburse funds to Cooperative Societies. The maximum is 25 farmers per cooperatives. We have more than 200 farmers’ cooperative societies in Ebonyi.
Agriculture is the flagship of this administration’s agenda. We have nothing else. If we don’t do this, we’ll sink. It is a swim and sink situation for Ebonyi.
FG Paying N1.1 Billion Per Day as Subsidy
The recent jumped in crude oil prices means landing cost of Premium Motor Spirit (PMS), popularly known as Petrol, has increased but the Federal Government has maintained the old pump price of N161 – N165 per litre.
In a series of reports, the Petroleum Products Pricing Regulatory Agency (PPPRA) open market price, the price fuel marketers are expected to sell, is N183 per litre as of yesterday. A break down showed N160 is the landing cost per litre while the additional N23 is the Petroleum Products Pricing Regulatory Agency (PPPRA) pricing template.
Therefore, with the payment of additional N23 as stipulated in the PPPRA pricing template and the national petrol per day consumption figure at 50 million litres, the Buhari led administration is offsetting about N1.1 billion on petrol consumption daily.
The Nigerian National Petroleum Corporation (NNPC) has been deducting the amount before remitting balance of oil sales to the Federation Account, according to a Businessday report.
An anonymous person in the oil marketing industry said: “We are back to the era of subsidy and Nigeria is bleeding badly because of this.”
“With deregulation, the current price of petrol should not be less than N181, so who is funding subsidy of the product for Nigeria to buy at the current fixed price?“.
Another oil marketers said, “the government does not have the boldness to allow full deregulation of petrol because of the spiral effects on Nigerians, and bearing in mind that Nigerians are in very hard times.”
Alao Abiodun, the Head of Energy Research, New Nigeria Foundation, explained that “Because of the loans from the IMF and World Bank that they got with the condition that petrol should be deregulated, I believe the government is trying to manage the problem.”
Nigeria’s Big Oil-Refining Revamp Gets Off To A Slow Start
A year after shutting down all of its dilapidated refineries to figure out how to fix them, Nigeria still can’t say how much it will cost to do the work or where the money will come from.
Nigerian National Petroleum Corp. said it has finished the appraisal of its largest facility, but hasn’t completed the process at two others. Refining experts said the extended halt means the plants are at risk of rotting away and unlikely to restart on time.
“Things haven’t been looking good lately,” with Nigeria’s plants probably “completely out of action for some 18 months,” said Elitsa Georgieva, Executive Director at Citac, a consultant that specializes in African refining.
The dysfunction of its domestic refineries has long put Africa’s biggest oil producer in an ironic situation. It exports large volumes of crude to plants overseas, then pays a premium to import the fuels its customers produce.
Pledges to fix the facilities have been made and broken again and again over the years. For at least a decade, NNPC’s 445,000 barrels a day of refining capacity barely processed 20% of that amount.
The latest effort to fix the refineries was supposed to be different to the failed attempts that came before. The company had totally shut all three plants down by January 2020 to do a comprehensive appraisal, and set the ambitious target of having them all back up and running at 90% of capacity by 2023.
“The refineries have been deliberately shut down to allow for a thorough diagnosis,” said Kennie Obateru, an Abuja-based NNPC spokesman. “They can be fixed based on what the diagnosis reveals.”
The appraisal of the 210,000-barrel-a day Port Harcourt refinery has been completed and NNPC has called for bids for the necessary repairs, Obateru said. The company hasn’t determined how much the work will cost.
“It is when we close the bids, everything is analyzed and presented that we will know how much we need,” he said.
The diagnosis is underway at the 125,000-barrel-a-day Warri facility and should be complete before the end of the year, he said. After that, the study of the 110,000-barrel-a-day Kaduna plant will commence.
One year into the process, refining analysts are skeptical that all this work can be done by 2023.
“I don’t think anyone has a good understanding technically of what’s wrong with those refineries,” said Alan Gelder, vice president of refining, chemicals and oil markets at Wood Mackenzie Ltd. “They’re probably corroding, which makes it a very difficult proposition.”
NNPC reaffirmed its deadline and said there’s no reason the refineries, which are at least 40 years old, can’t be restored to full operation.
“There are refineries that are over a hundred years old still running, so age is not necessarily an impediment,” Obateru said.
There are parallel efforts backed by private companies to add to Nigeria’s capacity. Aliko Dangote, Africa’s richest person, is building a state-of-the-art 650,000 barrel-a-day refinery, which Citac estimates will start production in 2023.
Bringing NNPC’s Port Harcourt refinery to the same clean-fuel standards as Dangote’s modern plant would cost about $1.3 billion for the equipment, on top of whatever other repairs are required to get the facility running, Georgieva said.
NNPC is talking to oil-trading firms about $1 billion of prepayment deals that could finance the repairs at Port Harcourt, Reuters reported last week. Obateru declined to comment on the report, but said “I don’t envisage that we will have a problem getting people to invest.”
Food Inflation Hits Record High of 19.56 Percent in December 2020
Food Index, which measures prices of food items, grew by 19.56 percent in the month of December 2020 amid herdsmen attacks and flooding.
In the latest report from the National Bureau of Statistics (NBS), increases were recorded on Bread and cereals, Potatoes, Yam and other
tubers, Meat, Fruits, Vegetable, Fish and Oils and fats.
On month on monthly basis, the food sub-index rose by 2.05 percent in December 2020, 0.01 percent from 2.04 percent recorded in November 2020.
“The average annual rate of change of the Food sub-index for the twelve-month period ending December 2020 over the previous twelve-month average was 16.17 percent, 0.42 percent points from the average annual rate of change recorded in November 2020 (15.75) percent” the report stated.
Headline inflation number increased by 15.75 percent in the month of December 2020, up from 14.89 percent.
The report noted that increases were recorded in all COICOP divisions that yielded the Headline index.
On a month-on-month basis, “the urban index rose by 1.65 percent in December 2020, same as the rate recorded in November 2020, while the rural index also rose by 1.58 percent in December 2020, up by 0.02 percent above the rate that was recorded in November 2020 (1.56 percent).”
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