Friday, April 12Inside Business Africa

Bumps on Lagos path to generating N60b yearly from Imota Rice Mill

Efforts to make Nigeria self-reliant in the area of rice production and reduce the amount spent on importation of the item yearly, led to scaling up rice farming in the country. Taking up the cue, Lagos State invested in the construction of a 32 metric tonne per hour rice mill, with the hope that it will produce 115,200 metric tonnes milled rice yearly.

With this, the state government also hopes to supply the Nigerian market about 2.4 million bags of 50kg rice yearly, which according to expert, is capable of generating N60b revenue yearly.

Aside the huge revenue, over 250,000 jobs would be created in both the upstream and downstream sectors of the rice value chain of the mill.

Speaking on the likely economic impact of the mill, when it becomes functional, the Chief Executive Officer of Abadini Group, Abraham Ogebe Adonduwa, with an arm into rice production, explained that the revenue from a 32mt per hour rice-milling project should be anything from N60b yearly, if effective management is in place.

He, however, said this is only possible, if the state government effectively manages the mill, there are a myriad of potential pitfalls that can hamper such laudable venture in the country.

He listed power, availability of clean water, constant supply of raw paddy, logistics for easy movement of raw paddy and finished products and warehouses or silos for proper storage to preserve quality, as some of the stumbling blocks to realising the dream.

“Another very key factor is proper and effective management,” he said. “This alone can be the bane of the business because of corruption, especially in the public sector. It is too prevalent and may be the downfall of this enterprise.”

On how to overcome the challenges, Ogebe suggested public/private partnership to mitigate the risks. “With the right people in place and effective management, this project could change the trajectory of rice production in Nigeria and would be a huge booster for our local economy,” he said.

The integrated rice mill at Imota is a 22-hectare facility, with the rice mill taking about 8.5 hectares, consisting of a complete set of new mills, two warehouses, 16 silos with a storage capacity of 40 metric tonnes each, water treatment plant, effluent processing plant, staff quarters, administrative block, car park, and firefighting facility, among others.

The immediate past Agriculture Commissioner in the state, Gbolahan Lawal, noted that though the 32-metric tonnes mill should be able to cater for the rice needs of a substantial percentage of Lagosians, it is a far cry from the overall rice need of the people, particularly since rice consumption rate of an average person in this part of the world hovers between 32 and 40 kilograms, which explains why the state government is collaborating with the South West and Northern states, as well as the Rice Farmers Association (REFAN) for the supply of rice paddy.

The Chief Executive Officer, Bama Farms Limited and a former Chairman, Lagos Chambers of Commerce and Industry (LCCI) Agric and Agro Allied Group, Prince Wale Oyekoya, noted that Nigeria is not lacking of good policies, but implementation is usually the issue. In his view, one of the key challenges the mill would grapple with is the raw material, paddy rice to service the mill.

He said: “I believe it is an elephant project, in the sense that if you look at Lagos State, how many people are planting rice and how many farmers have been encouraged to plant rice? The rice being planted, are they highbred that could give high product? And if you look at the rice mill that Fashola started, it was not even managed well, despite the fact that it was of a lesser capacity compared to what they have now. Even with that less capacity, they could not run the mill well. I was there several times. It was more like a showcase. If they do not have the raw materials to feed it, it is going to be underutilised, which will lead to wastage.

“I believe they should concentrate more on how to directly get the raw materials, not contracting it to other states, which have their own problems. This is aside the fact that they need rice too. I learnt that they have partnered Ondo, Ekiti, Ogun and Oyo states to plant rice, acquiring land for the planting. With the climate change, it is going to be very big issue, not only on rice.”

He advised the state to avoid running the mill. Rather, it should give it to the private sector to manage, if it is to be successfully managed.

“Whatever business government runs has never been successful,” he said. “We can see the example in what happened at Araga. Everything was run down. And it was because it is a state farm estate. If you go there now, it is a ghost town. They said they wanted to revive it, and every year, money is pumped into it. I hope this one will not end up like that.”

Another issue the mill could face is not getting enough farmers to produce the paddy rice, which might be a big problem. “It is not just about having gigantic machines. What about running cost? The logistic to bring the paddy rice to Lagos from other states will make the cost high, just like what happened with Lake Rice. The logistic to bring the rice to Lagos was responsible for its high cost. They have to really empower and encourage local farmers, so that it will be easy for them to produce the paddy rice.”

With about four months to the delivery date of the rice mill, the state government is not relenting in its effort to ensure its materialisation. During the week, it said about 800 rice farmers were empowered to grow more paddy rice, with preferred high yielding Farrow 44 seeds, brand new high quality knapsack sprayers, rain boots and farm coats.

The State Acting Commissioner for Agriculture, Ms. Abisola Olusanya, who gave out the empowerment tools at the beginning of a three-day capacity building and training of rice farmers on current production practices in the rice value chain, explained that the state government’s strategic intervention was informed by the need to boost farming activities of rice farmers in the state.

She pointed out that the empowerment programme was also geared towards ensuring the sustainable supply of paddy, particularly bearing in mind the imminent completion of the state-owned Imota Rice Mill project.

“It is expected that if these farming techniques are adopted by the farmers in the next planting season, it will result in an increase in paddy production in the state to an expected average yield of four tonnes per hour,” she stated.

She said the training would also expose the farmers to efficient harvesting methods, by using the most up-to-date agricultural practices to ensure maximum output, improved yield, as well as derive maximum return on investment.

She said: “Due to the fact that the state has limited agricultural cultivable land area, and with the increasing rate of small and large scale rice mills across the nation, there is a strain on the state getting constant supply of paddy to feed the mill, when it becomes fully operational.

“It is to this end that the Ministry has embarked on the sensitisation of rice farmers to train and disseminate the current production practices and empowerment geared towards sustainable supply of paddy by Lagos Rice farmers towards the Imota Rice Mill project.”

She explained that the training was necessary to bridge the rice demand deficit of residents and the Federal Government’s current ban on importation of rice.

She disclosed that the training would take place in 20 locations cut across Ikorodu, Epe, Badagry, Gboyinbo, Idena, Obada, Ito Ikin, and Ise.

“We would be monitoring these farmers to see how their yield improvement is going to be, such that we can take the training forward from there, while also helping them around empowerment issues, including land clearing tractorisation, swam buggies and others, which I believe we would be able to provide for them,” she said.

Source: Guardian

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