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Surprise Resurgent of Rice Farms in Ebonyi

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david-umahi

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.
Farmers’ congress

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.

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.

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Economy

Federal Government Set to Seal $3.8bn Brass Methanol Project Deal in May 2024

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Gas-Pipeline

The Federal Government of Nigeria is on the brink of achieving a significant milestone as it prepares to finalize the Gas Supply and Purchase Agreement (GSPA) for the $3.8 billion Brass Methanol Project.

The agreement to be signed in May 2024 marks a pivotal step in the country’s journey toward industrialization and self-sufficiency in methanol production.

The Brass Methanol Project, located in Bayelsa State, is a flagship industrial endeavor aimed at harnessing Nigeria’s abundant natural gas resources to produce methanol, a vital chemical used in various industrial processes.

With Nigeria currently reliant on imported methanol, this project holds immense promise for reducing dependency on foreign supplies and stimulating economic growth.

Upon completion, the Brass Methanol Project is expected to have a daily production capacity of 10,000 tonnes of methanol, positioning Nigeria as a major player in the global methanol market.

Furthermore, the project is projected to create up to 15,000 jobs during its construction phase, providing a significant boost to employment opportunities in the country.

The successful execution of the GSPA is essential to ensuring uninterrupted gas supply to the Brass Methanol Project.

Key stakeholders, including the Nigerian National Petroleum Company Limited and the Nigerian Content Development & Monitoring Board, are working closely to finalize the agreement and pave the way for the project’s advancement.

Speaking on the significance of the project, Minister of State Petroleum Resources (Gas), Ekperikpe Ekpo, emphasized President Bola Tinubu’s keen interest in expediting the Brass Methanol Project.

Ekpo reaffirmed the government’s commitment to facilitating the project’s success and harnessing its potential to attract foreign direct investment and drive economic development.

The Brass Methanol Project represents a major stride toward achieving Nigeria’s industrialization goals and unlocking the full potential of its natural resources.

As the country prepares to seal the deal in May 2024, anticipation grows for the transformative impact that this landmark project will have on Nigeria’s economy and industrial landscape.

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IMF Report: Nigeria’s Inflation to Dip to 26.3% in 2024, Growth Expected at 3.3%

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IMF global - Investors King

Nigeria’s economic outlook for 2024 appears cautiously optimistic with projections indicating a potential decrease in the country’s inflation rate alongside moderate economic growth.

The IMF’s revised Global Economic Outlook for 2024 highlights key forecasts for Nigeria’s economic landscape and gave insights into both inflationary trends and GDP expansion.

According to the IMF report, Nigeria’s inflation rate is projected to decline to 26.3% by the end of 2024.

This projection aligns with expectations of a gradual easing of inflationary pressures within the country, although challenges such as fuel subsidy removal and exchange rate fluctuations continue to pose significant hurdles to price stability.

In tandem with the inflation forecast, the IMF also predicts a modest economic growth rate of 3.3% for Nigeria in 2024.

This growth projection reflects a cautious optimism regarding the country’s economic recovery and resilience in the face of various internal and external challenges.

Despite the ongoing efforts to stabilize the foreign exchange market and address macroeconomic imbalances, the IMF underscores the need for continued policy reforms and prudent fiscal management to sustain growth momentum.

The IMF report provides valuable insights into Nigeria’s economic trajectory, offering policymakers, investors, and stakeholders a comprehensive understanding of the country’s macroeconomic dynamics.

While the projected decline in inflation and modest growth outlook offer reasons for cautious optimism, it remains essential for Nigerian authorities to remain vigilant and proactive in addressing underlying structural vulnerabilities and promoting inclusive economic development.

As the country navigates through a challenging economic landscape, concerted efforts towards policy coordination, investment promotion, and structural reforms will be crucial in unlocking Nigeria’s full growth potential and fostering long-term prosperity.

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South Africa’s March Inflation Hits Two-Month Low Amid Economic Uncertainty

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South Africa's economy - Investors King

South Africa’s inflation rate declined to a two-month low, according to data released by Statistics South Africa.

Consumer prices rose by 5.3% year-on-year, down from 5.6% in February. While this decline may initially suggest a positive trend, analysts caution against premature optimism due to various economic factors at play.

The weakening of the South African rand against the dollar, coupled with drought conditions affecting staple crops like white corn and geopolitical tensions in the Middle East leading to rising oil prices, poses significant challenges.

These factors are expected to keep inflation relatively high and stubborn in the coming months, making policymakers hesitant to adjust borrowing costs.

Lesetja Kganyago, Governor of the South African Reserve Bank, reiterated the bank’s cautious stance on inflation pressures.

Despite the recent easing, inflation has consistently remained above the midpoint of the central bank’s target range of 3-6% since May 2021. Consequently, the bank has maintained the benchmark interest rate at 8.25% for nearly a year, aiming to anchor inflation expectations.

While some traders speculate on potential interest rate hikes, forward-rate agreements indicate a low likelihood of such a move at the upcoming monetary policy committee meeting.

The yield on 10-year bonds also saw a marginal decline following the release of the inflation data.

March’s inflation decline was mainly attributed to lower prices in miscellaneous goods and services, education, health, and housing and utilities.

However, core inflation, which excludes volatile food and energy costs, remained relatively steady at 4.9%.

Overall, South Africa’s inflation trajectory underscores the delicate balance between economic recovery and inflation containment amid ongoing global uncertainties.

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