The Nigerian Rice Economy: Policy Options for Transforming Production, Marketing, and Trade

319 Pages·2016·15.436 MB·English

by  Kwabena Gyimah-Brempong, Michael Johnson, Hiroyuki Takeshima

THE NIGERIAN RICE ECONOMY
POLICY OPTIONS FOR TRANSFORMING
PRODUCTION, MARKETING, AND TRADE
EDITED BY
KWABENA GYIMAH-BREMPONG,
MICHAEL JOHNSON,
AND HIROYUKI TAKESHIMA
The Nigerian Rice Economy
I Thi book is published by che Universiry of Perrnsylvania Press
(UPP) on behnlf of the Internacional Food Policy Research lnstirure
(IFPRI) a pare of a joint-publicacion series. Books in the series pre
sent research on food security and economic devdopmenc with the
aim of reducing poverty and eliminating hunger and malnua·icion
IFPRI in developingnacions. They are the produce ofp eer-reviewed IFPRI
research and are elected by murual agreement between the parties
for publication under the joint IFPRI-UPP imprint.
The Nigerian Rice Economy
Policy Options for Transforming
Production, Marketing, and Trade
Edited by Kwabena Gyimah-Brempong, Michael Johnson,
and Hiroyuki Takeshima
Published for the International Food Policy Research Institute
PENN
University of Pennsylvania Press
Philadelphia
Copyright © 2016 International Food Policy Research Institute.
All rights reserved. Except for brief quotations used for purposes of review or
scholarly citation, none of this book may be reproduced in any form by any
means without written permission from the publisher.
Any opinions stated herein are those of the author( s) and are not necessarily
representative of or endorsed by the International Food Policy Research
Institute.
Published by
University of Pennsylvania Press
Philadelphia, Pennsylvania 19104-4112
www.upenn.edu/ pennpress
Library of Congress Cataloging-in-Publication Data is available.
ISBN 978-0-8122-4895-l
Printed in the United States of America on acid-free paper
10 9 8 7 6 5 4 3 2 1
Contents
Tables and Figures vii
Acronyms and Abbreviations xiii
Foreword xv
Acknowledgments xvii
Chapter 1 Rice in the Nigerian Economy and Agricultural Policies 1
Kwabena Gyimah-Brempong, Michael Johnson, and
Hiroyuki Takeshima
Chapter 2 Evolution of Rice Consumption and Demand Patterns 21
Kwabena Gyimah-Brempong and Oluyemisi Kuku-Shittu
Chapter 3 Production Systems: Biophysical and Economic
Environment and Constraints 51
Hiroyuki Takeshima and Oladele Samuel Bakare
Chapter 4 Policy Options for Inducing a Supply Response 85
Hiroyuki Takeshima
Chapter 5 Postharvest Processing, Marketing, and
Competitiveness of Domestic Rice 111
Michael Johnson and Akeem Ajibola
Chapter 6 Policy Options for Modernizing the Milling Sector 139
Michael Johnson
Chapter 7 Rice Imports, Prices, and Challenges for Trade Policy 159
Paul A. Dorosh and Mehrab Malek
vi
Chapter 8 Economywide Effects and Implications of
Alternative Policies 181
Xinshen Diao, Michael Johnson, and Hiroyuki Takeshima
Chapter 9 Transforming the Rice Sector 203
Kwabena Gyimah-Brempong, Michael Johnson, and
Hiroyuki Takeshima
Appendix A A Brief Chronology of Nigeria's Political History 211
Kwabena Gyimah-Brempong, Michael Johnson, and
Hiroyuki Takeshima
Appendix B The Linear Expenditure System Model 213
Kwabena Gyimah-Brempong and Oluyemisi Kuku-Shiccu
Appendix C Additional Tables to Chapter 3 225
Hiroyuki Takeshima and Oladele Samuel Bakare
Appendix D Supply Response Analysis 229
Hiroyuki Takeshima
Appendix E A Mathematical Derivation of the Rice Milling Model
for Nigeria 239
Michael Johnson
Appendix F A Stylized Rice Tariff Model 253
Paul A. Dorosh and Mehrab Malek
Appendix G Agricultural Sectors included in the Economywide
Multimarket Model 259
Xinshen Diao, Michael Johnson, and Hiroyuki Takeshima
References 261
Authors 287
Index 291
Tables and Figures
Tables
1.1 Top ten major rice importers and exporters in the world,
2000-2012 (percent) 3
1.2 Average annual volume and growth rates of milled rice supply in
Nigeria and the rest of West Africa and Africa south of the Sahara
(SSA), 1980-2013 4
1.3 Selected socioeconomic indicators for Nigeria, 1995-2012 6
1.4 West Africa selected indicators, 2012 7
2.1 Ranking of per capita consumption and expenditure 25
2.2 Rice consumption and production in 2011 26
2.3 Average household budget share across commodities 27
2.4 Share of households consuming rice by region 27
2.5 Consumption patterns by region 28
2.6 Household budget shares and income elasticities of demand 33
2.7 Household budget shares and expenditure elasticities, rural and
urban locations 41
2.8 Household own-price elasticities of demand 42
2.9 Household own-price elasticities of demand by urban and rural
location and income class 45
2.10 Household expenditure elasticities of demand by rural and urban
location and income class 46
2.11 Household average and marginal budget shares by rural and urban
location and income class 47
viii
3.1 Rice paddy yield trends ( five-year average, tons per hectare) 53
3.2 Dominant rice-production systems in Nigeria 54
3.3 Rice production shares by geopolitical zones (percent) 55
3.4 Percentiles of household-level rice area distributions in Nigeria
(average of2010 and 2012) 55
3.5 Popular rice varieties grown in Nigeria 56
3.6 Average quantity (per hectare) of fertilizer used and yield of rice
production in Nigeria (January-August 2010) 57
3.7 Rice irrigation area by water regime ( average of 2010 and 2012,
January-August, 1,000 ha) 58
3.8 Share of rice growers growing other key crops (percent), by
irrigation status 59
3.9 Share (percent) of total rice areas cultivated by tractors and
animal traction by geopolitical zones 60
3.10 Characteristics of major rice producers in Nigeria, 2010 61
3.11 Annual and dry-season rainfalls in selected locations with
distinct dry seasons 63
3.12 Agroclimatically attainable yield (t ons per hectare) of rice under
irrigated conditions with varying input intensity 65
3.13 Types oflowlands in Africa 66
3.14 Rice ecology soil endowment per capita (square meters per
person) 68
3.15 Rice ecology soil endowment per capita in some West African
countries (square meters per person) 69
3.16 Share of farmers and rice farmers in Nigeria affected by flood,
poor rain, and pests in 2010 (percent) 75
4.1 Rice-production performance, input use, and costs in selected
locations in Nigeria based on farmer interviews, 2013 88
4.2 Rice farm budgets in irrigated ecologies 90
4.3 Crop budgets for rainfed rice (selected locations in Nasarawa
State based on ecological status) 93
4.4 Price elasticity of rice production and irrigated rice area in Nigeria 97
4.5 Price elasticity of rice supply in Nigeria and other countries 98
4.6 Drivers of rice-production growth in selected Asian countries,
1965-1980 100
ix
4.7 Number of varieties released in Nigeria and Asia by National
Agricultural Research Institutes and other sources 101
4.8 Annual investment in irrigation in selected countries and Nigeria 105
4.9 Share of irrigated area among all rice areas in selected countries 107
4.10 Growth in nominal rate of assistance to agriculture, selected
West African countries, 1960-2004 107
4.11 Urea-to-paddy (kg) price ratio in selected countries and Nigeria 108
5.1 Comparison of production costs, yields, and profit margins 125
5.2 Key indicators of efficiency and profitability of small-
versus large-scale rice milling 128
6.1 Effect of policies on national output by types of miller and rice
(million MT) 146
6.2 Effect of policies on shares in national output by types of miller
and rice (percent of total rice output) 147
6.3 Effect of policies on zonal output by types of rice 149
6.4 Effect of policies on change in employment by miller and rice
type (percent change from base) 150
6.5 Effect of policies on changes in employment shares by miller
type (as percent of national employment in the rice milling
industry) 151
6.6 Effect of different miller strategies on total output by miller and
rice type (percent change from base) 153
6.7 Effect of different miller strategies on total output by zone
(percent change from base) 155
6.8 Effect of different miller strategies on total employment in the
milling industry by miller and rice type (percent change from
base total) 156
7.1 Rice imports by Nigeria and world rice exports to Nigeria,
2008-2012 161
7.2 Nigeria's average annual rice imports, production, and domestic
availability, 1960-2012 164
7.3 Average annual nominal and real exchange rates for Nigeria,
1980-2010 167
7.4 Import prices, import tariffs, exchange-rate premiums, and
wholesale prices of rice, 1980-2013 171