The global price of rice has plummeted to its lowest level in 16 years, according to the Thai Rice Exporters Association. The sharp decline follows India’s recent decision to relax its export restrictions, leading to a significant drop in rice prices that have not been seen since 2008.
India, a leading exporter of rice to both Asia and Africa, made the policy shift after assessing its domestic rice output. As a result, the Thai white rice price broke the Asian 5% benchmark, dropping to $509 per ton, marking the steepest decline in more than 15 months.
Africa to Benefit from Decline in Rice Prices
Africa, a major importer of rice, is expected to benefit significantly from the global price drop. Countries such as Senegal, which rely heavily on imports from India and Thailand, could see substantial relief in food costs. Rice is a staple food across the continent, accounting for about 60% of many diets. With lower import costs, the decline is likely to improve food accessibility for millions, especially in regions where rice is a primary dietary component.
The drop in rice prices is also anticipated to help stabilize inflation in these countries, offering relief to consumers who have been grappling with rising food prices amid economic challenges. Lower import costs could ease inflationary pressures, making rice more affordable and accessible for everyday consumption.
Nigeria’s Restriction on Rice Importation Limits Benefit
Despite the global drop in rice prices, Nigeria may not immediately benefit due to its federal policy on rice import restrictions. The Nigerian government has implemented a backward integration program aimed at boosting domestic rice production, part of its broader effort to promote self-sufficiency in agriculture. While Nigeria’s rice production reached approximately five million metric tonnes in 2023, this covers only about 60% of the country’s consumption needs, creating a shortfall that has led to illicit rice imports and a significant increase in market prices.
Since the implementation of the rice import ban, rice prices have continued to surge, despite heavy government investments in the sector. Initiatives like the N1.1 trillion Anchor Borrowers’ Programme have been aimed at increasing local rice output. However, between 2016 and 2023, rice prices have risen sharply, exacerbating inflation.
Call for Importation amid Rising Inflation
Amid rising food inflation in Nigeria, which hit 37.52% year-on-year according to the National Bureau of Statistics (NBS), some stakeholders have renewed calls for the government to reconsider its restrictive import policies. Although the government recently waived import duties on certain food items such as wheat, maize, brown rice, and beans to curb inflation, implementation has been slow.
Some industry experts have suggested that the government should wait until the agricultural harvest season before fully enforcing its import waivers, ensuring that local producers are not adversely affected. As inflation continues to rise, many Nigerians hope that easing import restrictions could help reduce food prices, providing much-needed relief for households struggling with the high cost of living.
While global rice prices have reached historic lows, Nigeria’s unique policy environment may prevent the country from reaping the full benefits of this development, as domestic production challenges and inflation concerns persist.
