The refusal of the Central Bank of Nigeria (CBN) to grant letters of credit (L/Cs) to the country's rice buyers has failed to dampen imports according to a trade organisation.

Nigeria's Rice Millers, Importers and Distributors Association (RMIDA) claims the country's rice production represents just 56 per cent of consumption, a figure that is at odds with official figures.

Objectives missed

According to RMIDA, there is little evidence that the CBN's restrictions on L/Cs have achieved their objective.

Nigeria consumes 4.5 million metric tons of rice annually and is dependent on imported rice to meet demand according to the association.

It says the country's rice deficit amounted to 2 million metric tons over the last year while importers brought into Nigeria 2.3 million metric tons of rice valued at around US$1.2 billion.

Official view

The CBN's refusal to grant L/Cs was intended to boost production of Nigerian rice, which officials hoped would mean 90 per cent of rice demand was met by local producers.

Nigeria's ministry of agriculture and rural development claims this level of market penetration has been reached.

This article represents the views of the author and not necessarily those of the ICC or Coastline Solutions.