Fuel Subsidy: Nigerians Groan As Rice Prices Surge 123%, 50kg Sells For ₦130,000

Nigerians are now paying around N105,000 for a 50kg bag of locally-produced parboiled rice, surpassing the new minimum wage of N70,000.

This rise follows the removal of the petrol subsidy and the devaluation of the naira, pushing local rice prices up by 123% over the past year.

Imported rice has also become costly, with a 50kg bag now priced at N130,000, according to a recent BusinessDay market survey.

The steep increase in rice prices highlights the limited capacity of smallholder farmers to meet local demand, due to challenges like insecurity, high input costs, and logistical difficulties.

In Lagos, traders are holding back stock in anticipation of higher prices as the festive season approaches, when demand traditionally spikes.

“The cost of local rice keeps climbing because millers are burdened by high production costs,” said Bose, a trader at Daleko Market in Lagos, attributing the hike in imported rice prices to foreign exchange fluctuations. Bose called for government intervention to ease the impact on Nigerians.

Although the federal government announced in July a suspension of import duties on rice and other essential items to tackle food insecurity, the policy has yet to be implemented, and food prices continue to rise.

“We still don’t grow enough rice to feed our population, and issues like insecurity and kidnappings threaten food security,” said AfricanFarmer Mogaji, CEO of X-Ray Consulting.

Mogaji pointed out that recent flooding and a grain export ban by Nigeria’s northern neighbor, Niger, have further hindered rice production.

“This export ban limits the supply of paddy for local millers, as much of it comes from neighboring countries,” Mogaji explained, adding that insecurity has left many farmlands abandoned.

This sentiment reflects the recent economic data showing a slowdown in the agricultural sector, with second-quarter GDP growth at 1.4%, down from 1.5% in the same quarter last year.

Struggling consumers, like Chioma Okeke, a teacher in Lagos, are feeling the strain. “How can I afford N105,000 for a bag of rice when I only earn N100,000? There’s barely anything left for my family’s needs,” she said. “Prices keep going up, and the subsidy removal has only made things worse,” Okeke added.