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CBN: Local Rice Production Records 70% Increase

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bags of rice
  • CBN: Local Rice Production Records 70% Increase

The Central Bank of Nigeria (CBN) has stated that the production of rice locally has increased to 70per cent following the introduction of the Anchor Borrowers Programme by the federal government.

Head of Development Finance Department of the Bank, Mr. Chukwudum Nzelu, who disclosed this in Calabar, Cross River State, at the weekend, said before the introduction of the scheme, local rice production stood at 30per cent.

Speaking at a CBN Fair staged to educate the people on financial literacy and the workings of bank, Nzelu said with the increase in rice production locally, Nigeria has saved a lot of foreign exchange.

He noted that if the trend in rice production continues, the country would have succeeded in creating jobs through a new generation of farmers, distributors, transporters, marketers and allied industries associated with rice production.

Nezlu said that the market is inexhaustible because the nation’s population is huge, and there is huge demand for rice in the country.

“So we did an experiment with rice through what we called the anchor borrowers programme, where a rice miller comes as an off taker for small holder farmers who would produce for him and then he takes from them and mills.

“Factories that were operating at 30 per cent now are operating at 70 per cent production capacity after the experiment. With this increase we have created jobs. That is why between 2016 and 2017, we have a lot of local rice in the market. So many local factories that were dormant became active again,” Nezlu said.

Nzelu, who led the Team from the CBN, said they were also intervening in an accelerated agricultural development scheme, aimed at engaging a minimum of 10, 000 youths between the ages of 18 and 35 from the 36 states and Abuja.

“If we are able to take out 10, 000 unemployed people out of the market, you can imagine when you multiply that by 36 states and Abuja,” Nzelu said.

Nzelu said though the core mandate of the CBN requires that they intervene in other sectors to develop the economy, the bank was also saddled with the responsibility of ensuring price and financial system stability.

He said the CBN was concerned that if the country continues importing what can be produced locally, it would deny the people the jobs that would have been created.

In his remarks, the Cross River State Branch Controller of the CBN, Dr. Graham Kalio, urged the participants in the fair to make effective use of the forum because the bank wants the prosperity of everyone Nigerian.

“Put whatever you learn into practice. We want to make sure your money is safe and you have a way of making that money, so you can live well. We want to enjoy everyone enjoys the riches of Nigeria,” Kalio said.

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.

Crude Oil

Oil Dips Below $62 in New York Though Banks Say Rally Can Extend

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Oil Dips Below $62 in New York Though Banks Say Rally Can Extend

Oil retreated from an earlier rally with investment banks and traders predicting the market can go significantly higher in the months to come.

Futures in New York pared much of an earlier increase to $63 a barrel as the dollar climbed and equities slipped. Bank of America said prices could reach $70 at some point this year, while Socar Trading SA sees global benchmark Brent hitting $80 a barrel before the end of the year as the glut of inventories built up during the Covid-19 pandemic is drained by the summer.

The loss of oil output after the big freeze in the U.S. should help the market firm as much of the world emerges from lockdowns, according to Trafigura Group. Inventory data due later Tuesday from the American Petroleum Institute and more from the Energy Department on Wednesday will shed more light on how the Texas freeze disrupted U.S. oil supply last week.

Oil has surged this year after Saudi Arabia pledged to unilaterally cut 1 million barrels a day in February and March, with Goldman Sachs Group Inc. predicting the rally will accelerate as demand outpaces global supply. Russia and Riyadh, however, will next week once again head into an OPEC+ meeting with differing opinions about adding more crude to the market.

“The freeze in the U.S. has proved supportive as production was cut,” said Hans van Cleef, senior energy economist at ABN Amro. “We still expect that Russia will push for a significant rise in production,” which could soon weigh on prices, he said.

PRICES

  • West Texas Intermediate for April fell 27 cents to $61.43 a barrel at 9:20 a.m. New York time
  • Brent for April settlement fell 8 cents to $65.16

Brent’s prompt timespread firmed in a bullish backwardation structure to the widest in more than a year. The gap rose above $1 a barrel on Tuesday before easing to 87 cents. That compares with 25 cents at the start of the month.

JPMorgan Chase & Co. and oil trader Vitol Group shot down talk of a new oil supercycle, though they said a lack of supply response will keep prices for crude prices firm in the short term.

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Crude Oil

Oil Prices Rise With Storm-hit U.S. Output Set for Slow Return

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Crude oil

Oil Prices Rise With Storm-hit U.S. Output Set for Slow Return

Oil prices rose on Monday as the slow return of U.S. crude output cut by frigid conditions served as a reminder of the tight supply situation, just as demand recovers from the depths of the COVID-19 pandemic.

Brent crude was up $1.38, or 2.2%, at $64.29 per barrel. West Texas Intermediate gained $1.38, or 2.33%, to trade at $60.62 per barrel.

Abnormally cold weather in Texas and the Plains states forced the shutdown of up to 4 million barrels per day (bpd) of crude production along with 21 billion cubic feet of natural gas output, analysts estimated.

Shale oil producers in the region could take at least two weeks to restart the more than 2 million barrels per day (bpd) of crude output affected, sources said, as frozen pipes and power supply interruptions slow their recovery.

“With three-quarters of fracking crews standing down, the likelihood of a fast resumption is low,” ANZ Research said in a note.

For the first time since November, U.S. drilling companies cut the number of oil rigs operating due to the cold and snow enveloping Texas, New Mexico and other energy-producing centres.

OPEC+ oil producers are set to meet on March 4, with sources saying the group is likely to ease curbs on supply after April given a recovery in prices, although any increase in output will likely be modest given lingering uncertainty over the pandemic.

“Saudi Arabia is eager to pursue yet higher prices in order to cover its social break-even expenses at around $80 a barrel while Russia is strongly focused on unwinding current cuts and getting back to normal production,” said SEB chief commodity analyst Bjarne Schieldrop.

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Crude Oil

Crude Oil Rose Above $65 Per Barrel as US Production Drop Due to Texas Weather

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Crude Oil Rose Above $65 Per Barrel as US Production Drop Due to Texas Weather

Oil prices rose to $65.47 per barrel on Thursday as crude oil production dropped in the US due to frigid Texas weather.

The unusual weather has left millions in the dark and forced oil producers to shut down production. According to reports, at least the winter blast has claimed 24 lives.

Brent crude oil gained $2 to $65.47 on Thursday morning before pulling back to $64.62 per barrel around 11:00 am Nigerian time.

U.S. West Texas Intermediate (WTI) crude rose 2.3 percent to settle at $61.74 per barrel.

“This has just sent us to the next level,” said Bob Yawger, director of energy futures at Mizuho in New York. “Crude oil WTI will probably max out somewhere pretty close to $65.65, refinery utilization rate will probably slide to somewhere around 76%,” Yawger said.

However, the report that Saudi Arabia plans to increase production in the coming months weighed on crude oil as it can be seen in the chart below.

Prince Abdulaziz bin Salman, Saudi Arabian Energy Minister, warned that it was too early to declare victory against the COVID-19 virus and that oil producers must remain “extremely cautious”.

“We are in a much better place than we were a year ago, but I must warn, once again, against complacency. The uncertainty is very high, and we have to be extremely cautious,” he told an energy industry event.

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