2013 Christmas: Nigerians decry hike in prices of goods

With just a few days to Christmas, traders in major markets in the country especially in Lagos are lamenting low patronage even as prices of foodstuffs and other household goods take the usual dimension of increment.

When Saturday Vanguard visited some markets in the metropolis, it was discovered that the usual crowd witnessed in markets was not there.

Even those who came to buy things in the markets could not buy as much as they can because of the economic situation of the country. A trader at Balogun market, Alhaja Bilikisu Ayinla, expressed dissatisfaction with the level of sales this yuletide season, attributed the low patronage to the economy of the nation which has taken a negative turn on the people. She observed that despite the increase in the prices of foodstuffs which is like a tradition every yuletide, people still buy what they need for the festive period if the money is available. metro-market “As usual, prices of things have skyrocketed but the truth is that there is no money in the country.

Many people are thinking of how to take care of themselves and their families because if they spend the only money they have on christmas and new year celebrations, how are they going to survive after the celebrations in a country where you cannot predict anything? As you can students will be going back to school and most parents will be saving for their wards school fees. Alhaji Abubakar, at Sura market, who sells livestocks including chicken, turkey among others also lamented low rate of patronage as the celebrations draw closer, saying that the goods he bought for three weeks are yet to be sold.

According to him, a giant agric turkeys which used to be N10,000, now goes for N13, 000, while a giant local turkey which was sold for N6000 before the festive period now goes for N9,000, which he attributed to increase in the price of turkey feeds from N1700 to N2000. “By this time last year, despite the complaint over inadequate money, people were seen buying things for Christmas especially when it was just a few weeks to the celebration. But, this year, things are different. Everything is dull and the market looks as if nothing special is going on. ”Surprisingly, the price of rice and beans have gone up more than expected. The reason for this has not known as our government seems to have turned deaf ear to our plight”. This is the submission of Mrs Bisi Bankole, who deals on wholesale goods at Daleko market. She sells rice and beans of all kinds.

Unlike the past years, Madam Bisi says, the increase in prices of rice have affected her sales negatively. ”For instance, 50kg bag of caprice which was sold at the rate of N10,500 last year now goes for N14,500. Mama Gold is next on the list as 50kg is sold for N14,400. She also said a 50kg bag of Royal Stallion rice which was N9, 500 now goes for N11, 900. While the prices of other types have also increased by five percent. A tomatoes seller, Mohammed Bala who said the price of tomatoes has been fluctuating, attributed it to high transportation cost, just as he said the price for a basket of onions was N20,000.

At the popular Ojuwoye market in Mushin, a wine and beverage seller, who identified himself as Chairman as he is popularly called said, “the prices for most of our goods have changed while some have not. For instance, the prices of goods like malt, juice and other beverages have remained the same.” He however said with the introduction of new products in the market there has been a boom in the sales of beverages, adding that, “the christmas season has ushered in a good time for the business.” Similarly, while some shoes, bags and clothes dealers said they had been enjoying increased patronage as a result of the season, others say market has been dull. There was also a noticeable boom in hair dressing business as well as sales of clothing materials.

Christmas decorations were also on display for those who want to beautify their homes for the celebrations. In spite of the notable activities going on, traders in the market complained of low patronage as they said those who would have bought from them have travelled down to their various states to celebrate the christmas there. “We are not experiencing much sales because by now, people have started travelling to their villages for the christmas celebration,” Chinedu, one of the traders said. Already, prices of edibles and other cooking ingredients are shooting up. Various food items prices that have skyrocketed during this season are rice, groundnut oil,tomatoes, pepper,chicken, beef,onion and many others. This clearly revealed that the closer to yuletide, the higher the prices of food items.

At Ile-Epo market in Abule Egba, a trader miss Aminat at Ile-Epo market, said a 5-litre of Gino groundnut oil that sold for N1,200 in October is now N1,800; a sachet of knorr that cost 300 now costs N380. “Festive period is a time where traders like me have a high expectation of making increased sales. But what we experience now is just worrisome. Despite the crowdiness of the market, we have low sales and we can not get our goods at the usual price. The prices have been inflated.” She further said the reason for the hike is as a result of hoading of food items from the part of the manufacturers and their companies. “The major reason for the hike in prices of food items is that most of the manufacturers hoad their goods and sell little quantity to us the traders. ”Usually,most companies would seize the high demands during festive period to make excessive gains.

Buyers always throng this market in large numbers to make purchases and do last-minute shopping but the stress of selling in a crowded market where there is uneasy moment and all sorts of haste also causes fatigue with little to show for it”. She also chided that another reason for low sales is the creation of new markets and different shopping malls. “Another problem that is affecting our sales is all these new shopping malls scattered round the country and some people even go for on line shopping leaving our pocket almost without profit”. Another trader, mallam Ibrahim is of the opinion that sales during this period last year is far better than what they are experiening now in Ile-Epo market. Mallam Ibrahim said he is of the opinion that the poor economy is the reason for their low sales.

“The Nigerian economy is very hard on an average Nigerian and many Nigerians find the items too expensive. After parading the market, most of them go home without buying anything. It is not our fault that prices of food ingredients go up, it is from the manufacturers because it is what they sell to us that we will buy and resell. I think it is just natural for items to be expensive during this season.” But Adeife Salami differs on this trader’s line of thought. She said “It has become common for Nigerians, be it manufacturers or the traders, to always increase prices of foodstuff at festive period. Whenever there is any festivity, they see it as an opportunity to make extra gain, and that is greed.”

Apart from the hike in prices of food items so also is the increase in the demand of second hand clothes popularly known as Okirika. Many Nigerians now prefer okirika to new clothes due to different reasons especially at this period. However, a dealer of Okirika in Super market, Abule Egba, Mr Awodi expressed how this festive period turned sour for his business instead of the other way round. “this season is supposed to be our smiling time but the federal government has been on our neck and hindering trucks with our goods easy flow into the market.

The few truks that scale through their net,will increase the price of clothes. ”A pair of cloth that is supposed to be around N200 will get to us at N300 leaving us with no choice than to increase our prices. I plead with the government to see to it.” Chioma, a buyer at the market said the traders are only been exploitative. “somethings happen in this country that the government can not be blame for it. These traders just like to take advantage of the season to exploit us.”

Source: Vanguard

Ahead of 2013 Christmas: Price of rice goes up

Price of rice has hit the roof and low quality brand has flooded the market just as farmers have threatened to stop rice cultivation according to Tunji Owoeye, Chairman of RIMIDAN (Rice Millers Importers Association of Nigeria).

He said that farmers have threatened to stop production of rice as the Millers/ Processors are no longer buying from them. The Processors stopped buying because they could not compete with the smuggled imported rice.

The price of rice is soaring at a very alarming rate. Presently, a good brand costs N13, 000 and above. The fear is that prices of rice will further go up as Christmas and New Year festivities approach. While smuggled imported rice cost about N10, 000 in the open market locally produced rice cost as much as N13, 000. The quality of the smuggled rice is of low grade.

According to Financial Vanguard market survey since the imported rice in the market do not go through official channels like the Customs and Standard Organisation of Nigeria (SON), all imaginable types are now smuggled in. It is a situation of “anything goes”that is available in the markets place now; most of them are re-bagged in Nigeria and of very low quality standards. A lady, Mrs. Toyin Adegbenro, who does her shopping at Agege market axis, complained that rice in the market has become tasteless, no matter how well the stew or soup is prepared. The fall out of current policy on rice policy therefore is an influx of sub standard rice into the Nigerian market and this is very dangerous to the health and well being of the Nigerian consumers.

FG to rethink policy

THERE is however strong indication that the Federal Government may have a rethink about the high tariff on rice. This indication was given by the Chairman, Presidential Committee on Trade Malpractice, Alhaji Dahiru Ado-Kurawa, who said Government would soon review tariff on rice, to tackle smuggling and revenue loss.
Ado-Kurawa said in Lagos that the planned downward review was aimed at reducing the level of smuggling of the commodity from Benin Republic. He observed that the Federal Government introduced the rice policy of 110 per cent duty and levy in January, to boost local rice production.

“The Federal Government will likely adjust the policy because it has escalated the influx of smuggled rice from neighbouring countries. Benin Republic is one of the highest importers of parboiled rice, the country that ordinarily imports about 230,000 tonnes  per annum now imports about 2 million tonnes. The two-million-tonne parboiled rice imported by Benin is all smuggled into Nigeria,” the chairman said.

He recalled that the stakeholders met recently in Abuja and advised the Federal Government to review the rice policy and sift out the grey areas. This, he said, was to ensure that the government’s quest to halt rice import was achieved. Ado-Kurawa lamented that Nigeria lost over N2 billion to smugglers through land borders. According to him, Nigeria that used to be the highest rice importer, had suddenly relinquished the position to Benin Republic.  

Rice farmers say smuggling will hinder success of rice importation policy

Meanwhile Chairman, Rice Farmers Association of Nigeria (RIFAN), South-West zone, Mr Olusegun Atho, has said that unless smuggling is tackled, the current policy on imported rice will yield no result. He identified smuggling as the major factor that would hinder any ban on the imported commodity, just as it had adverse effect on local rice production. According to him, “Government needs to come out and deal with the issue of smuggling, in order to encourage local growers.’’ The RIFAN chairman also advised the government to provide adequate funding by way of grants or loans to farmers. “These factors are very important and must be put into consideration, before the proposed ban. If these things are not in place, the ban cannot be realistic.

Until when government begins to do something about it, that is when we can see the seriousness.” Atho also appealed to government to construct more dams and provide mini-pumping machines for farmers to prepare them for irrigation farming as well as introduce modern rice production technology. “If government can provide all these to farmers, that is when government can boast of self-sustainability.”  

Local rice farmers to be given incentive

Meanwhile, the Federal Ministry of Agriculture and Rural Development also said that local rice farmers would be given incentives for increased rice production. Dr Kayode Oyeleye, a Special Assistant to the Minister; Dr Akinwumi Adesina, said that the gesture was to make the price of locally produced rice competitive to the imported variety. Oyeleye said that the tariff on imported rice remained high because the Federal Government was encouraging the consumption of locally produced one. The special assistant also said that this would also strengthen the economy of the country as importation of rice would reduce.  

Nigerians applaud policy but... 

Much as Nigerians applaud the efforts of the Minister and other Officials of the agric ministry, in their attempt to boost and encourage local production; they deplore the hasty introduction of the high import tariff when a thorough analysis of the situation on ground has not been done. They argued that it is dangerous to play politics or score cheap political points with issues that affect the masses directly. It will be recalled that Vanguard on October 7, 2013 did a report on the situation of rice business in Nigeria.

The report highlighted the fact that importers have stopped bringing in rice through the Nigerian sea ports because of the high import tariff regime and that all brands of rice in the Nigerian market are smuggled in through the Nigeria – Benin land borders, even though import through the land route is officially prohibited. The report also predicted that the situation will result in scarcity of rice during the “Ember months” as smugglers and local producers will not be able to cope with demand since rice has become Nigeria’s most staple food. The local production that the tariff was meant to protect is also affected by the smugglers activities. The gainers are the smugglers and the Customs officials who will have to be settled at the various border points If the current tariff is to work, the Customs Department must put a stop to the activities of smugglers.

This appears to be a Herculean task for them to perform. If the customs are unable to perform, the land border should be open to all so that the government can earn duties, instead of allowing a few unscrupulous elements to make a gain from the situation. In the interim, stakeholders say that government can reverse the import tariff back to its previous position, so that importers can start bringing in rice. This will discourage the activities of the smugglers as it will not be profitable for them to bring in rice through Benin, as the tariffs will now be almost at par with what obtains at the ports.

 Way forward

At present local production is not strong enough to have any impact on rice importation, the quantity produced is not significant in percentage terms. Mr. Tunji Owoeye, suggested that the government should form a body of key stake holders he termed” Chain Drivers.” They are to work together with key government departments to set a realistic time table for local production. There should be a monitoring team to determine the true position of local production and the actual quantity of local rice that is going into the markets.

When Vanguard visited the markets in October, it did not find any local brand of rice on display for sale. It is clear that there is a great disparity between what is being quoted as local production/importation and the reality on ground. Right now, the market is in crisis; how does the common man get rice to eat this December?

The government should immediately set machinery in motion to facilitate urgent importation at an encouraging tariff rate to importers. This will serve as an ad-hoc measure for sufficient rice to be available in the market during the season. After the season, the Minister can assemble a committee of all stakeholders in the rice business to fashion out a way forward.

Price of foreign rice may crash this Xmas

The price of foreign rice may fall ahead of this yuletide as the federal government wants to review downward the 110 percent  import duty and levy it slammed on the commodity January this year to boost local production. Currently, the market price for full bag of rice goes for N9, 500 and N4, 800 half bag depending on the brand.

Chairman, Presidential Committee on Trade Malpractices, Alhaji Dahiru Ado-Kurawa, who gave the hint while fielding questions from journalists in Lagos said the decision by government to review the tariff downward was because the policy has escalated smuggling of the commodity and loss of revenue to the government to the tune of N2 billion in the past eleven months.

“Benin Republic is one of the highest importers of parboiled rice this year. This is the country that ordinarily imports about 230,000 tons per annum. The two million tons parboiled rice imported from Benin was all smuggled to Nigeria,’’ said Ado-Kurawa.

According to him, the stakeholders met recently in Abuja and part of the resolution was to advice the federal government to review the rice policy and sift out the grey areas where improvements could be made with a view to ensuring that the government’s quest to halt rice import was achieved.

According to him, the review is not a policy somersault but  an approach to create a healthy mechanism for Nigeria to be self sufficient in rice production and earn income from imported rice

The chairman disclosed that the government would also give  incentive to  to rice millers into backward integration. According to him, government’s policy on rice has greatly deepened local production, which was geared towards attaining self-sufficiency in the product.

He noted that local milling capacity has increased to 200 percent and there has been an increment in production of about four million tons of local rice, thereby driving the production of paddy rice to an all-time high.

President, Millers, Importers and Distributors Association of Nigeria, Mr. Tunji Owoeye, commended the federal government for looking into the challenges facing the rice sub-sector. He listed the challenges as smuggling of foreign rice brands through the Benin Republic border as well as incentives to rice farmers and processors.