Why price of milled rice is high – Labana Rice GM

Abdullahi Idris Zuru is the General Manager (GM) of Labana Rice Mill. In this interview, he speaks on the reasons for increase in the price of rice and how floods wreaked havoc on rice farms in Kebbi State. How has it been since Labana Rice Mill started production? #EndSARS: Oluwo Seeks Inclusion Of Traditional Rulers […]

Abdullahi Idris Zuru is the General Manager (GM) of Labana Rice Mill. In this interview, he speaks on the reasons for increase in the price of rice and how floods wreaked havoc on rice farms in Kebbi State.

How has it been since Labana Rice Mill started production?

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It has been very beneficial to both the paddy rice farmers and the rice milling companies. Millers as investors have been able to create wealth for the farming family and the business communities, as well as creating employment opportunities for the younger ones.

Labana Rice Mill started production in 2014 with 16 metric tonnes per hour. However, we are undergoing an expansion process now to 20 metric tonnes per hour. By the end of 2020, we hope to achieve 36 metric tonnes per hour. This indicates that we will be processing 360 metric tonnes per day.

Despite the rice revolution in the country and the increasing number of milling companies, the price of milled rice seems to be going up, what is responsible for this?

At the beginning of the rice revolution in Nigeria, there were only 15 standard integrated rice mills in the country and six years after there are about 60 standard rice mills.

When Labana Rice was established in 2014, it was the only standard rice mill in the whole of Kebbi State, but within a short time two more were established, apart from medium and small scale rice mills that dot the state. So with this number of rice mills in place, you can imagine the volume of demand for paddy rice. This even led to a competition among the milling companies for the procurement of paddy rice from farmers. This actually brought about a sharp increase in the price of rice. This is healthy for the economy as farmers will continue to produce.

Most often, when situations like this occur, those that are not within the production chain suffer a lot; as is the case now.

All sectors of the economy went through one economic stress or the other at the peak of COVID-19, what was the situation like for rice millers?

During the COVID-19 lockdown, some of the rice mills had to reduce their staff, some could not even source for paddy rice for production to continue, while others were forced to close down. Farmers could not go to farms because of the lockdown, crops dried off and many suffered complete losses of their crops. These, and coupled with many other reasons led to acute scarcity of paddy rice. The scarcity affected mills’ capacity of utilisation as production level dropped. This is one of the causes of the high price of rice.

Floods recently wreaked havoc in Kebbi State and destroyed many rice farmlands, what effects do millers in the state envisage from this?

The flood disaster in the state shattered the entire dream of rice farmers as their farms were washed away. The 10,000 hectares of rice farm belonging to Labana Rice Mill in Bagudu Local Government Area was also lost to the flood.

Prior to the flood disaster, Labana Rice Mill was expecting to harvest six to seven tonnes per hectare, but three weeks to harvest, flood destroyed everything. This means the company lost about 50,000 tonnes of paddy rice to the flood.

How can rice production bounce back without recording another increase in the price of the commodity?

The recent flood disaster has drawn us back to square one. However, we have what we call post-flood recovery plan, and the good news is that the Federal Government, the Central Bank of Nigeria (CBN) and Rice Processors Association of Nigeria (RIPAN) are all involved in the plan. The government is expected to support farmers with hybrid seeds and other inputs, as well as adequate cash. All forms of intervention by the government must be made available to the farmers at the right time because as the flood recedes, farmers must be mobilised back to their farms.

How is your mill carrying local farmers along?

In 2012, Labana Rice signed an MoU with USAID. Under this arrangement, USAID provides technical capacity to the farmers on high tonnage per hectare, and on the other hand, Labana Rice provides loans of agricultural inputs, water pumping machines and cash to the farmers. The company also established aggregation centres in some selected locations across the state. Under this arrangement, farmers are expected to bring their produce to the centre located close to them than spend much in transporting same to Labana Rice Mill in Birnin Kebbi.

The company also sought the support of the Kebbi State Government and 15 extension workers were loaned to the company; who the company provided with brand new machines with a view to provide technical assistance to rice farmers in the state.