Rice Price Hike Looms as Tinubu Administration Faces Tough Choice on Imports and Rising Costs
- The FG is considering closing rice import windows after a policy committee warned that Nigeria’s rice surplus depends heavily on imports
- Although imports helped reduce rice prices and food inflation in 2025, experts caution that shutting them down too quickly could raise prices again
- The government now faces the challenge of protecting local farmers and foreign exchange while avoiding another rise in rice prices
Legit.ng journalist Victor Enengedi has over a decade's experience covering energy, MSMEs, technology, banking and the economy.
Rice prices in Nigeria may start rising again in the coming months. This is because a government-backed policy group has advised the Federal Government to officially close all existing rice import channels.
If this advice is followed, the amount of rice available in the country could drop, putting pressure on prices, Punch reports.
Source: UGC
The recommendation came from the National Agribusiness Policy Mechanism (NAPM), a presidential body that guides food and agriculture policy. The group believes Nigeria’s current rice surplus depends too much on imports, not on strong local production.
Recently, rice prices fell in many markets. A 50kg bag dropped from around N76,000 to about N55,000 after the government allowed more imports to reduce food inflation. Closing import windows could undo these price drops.
Heavy imports hide weak local production
In 2025 alone, Nigeria spent over N1 trillion importing about 2.4 million metric tonnes of rice. At global market prices, this meant a large loss of foreign exchange. Rice imported from Thailand and India accounted for most of this cost.
NAPM pointed out that food inflation had dropped sharply from over 26% in January 2025 to about 11% by December. Because inflation eased, the committee said emergency rice import waivers were no longer necessary.
Nigeria produced about 6.07 million metric tonnes of rice in 2025 and imported 2.4 million tonnes, bringing the total supply to roughly 8.66 million tonnes. This was more than enough to meet demand, leaving a surplus of about 1.1 million tonnes.
However, the committee stressed that this surplus mainly existed because of high imports, not because farmers produced more rice locally.
Farmers struggle as costs rise and prices fall
Despite the rice surplus, experts warned that shutting imports too quickly could cause problems. Surveys showed that rice production fell by nearly 8% during the 2025 wet season due to high input costs and low prices paid to farmers.
Research across 13 states and over 33,000 farmers found that many rice and maize farmers made losses after import windows were opened. While costs for fertiliser, fuel, and irrigation stayed high, rice prices dropped, hurting farmers’ incomes.
The committee also noted that farmers were not protected by any price support system, such as a guaranteed minimum price. Poor extension services made things worse, with one extension officer serving over 6,000 farmers, limiting access to better seeds and farming methods.
Source: UGC
Because of these challenges, many farmers are reducing rice production. About 10.6% of rice farmers plan to switch to vegetables, wheat, or export crops in the next farming season.
Industry leaders warn that without subsidies and proper support, more farmers and rice millers will quit, leading to job losses and future shortages.
Analysts say the government now faces a tough choice: support local farmers and save foreign exchange, while making sure rice prices do not rise again and worsen the cost of living for Nigerians.
Smuggled rice worsens Nigeria's Forex crisis
Meanwhile, Legit.ng earlier reported that the Nigerian Customs Service warned that bringing banned items like rice and petrol into the country illegally is hurting the economy.
Customs officials said smuggling reduces government revenue and increases pressure on foreign exchange.
A Customs Area Controller explained that stopping rice smuggling is important so local rice millers can grow, create jobs, and compete fairly in the market.
Source: Legit.ng
