This chapter examines the importance of indigenous institutional arrangements in rice production and processing activities in Ogun State, Nigeria through the use of key informant interviews (KIIs). Analyses from the study show that agricultural financing constitutes the greatest challenge that affects rice production and processing. Other findings from the discourse reveal that in some rice producing areas where there is the existence of rice farmers' clusters, there is access to modern rice processing machines such as winnowers, threshers, and destoners. The operations of Rice Growers Association of Nigeria (RGAN) in Ogun State are coordinated by the executive committee, which constitute the indigenous institutional arrangement. This chapter recommends that sincere and concerted efforts on the part of the government in implementing the goals of agricultural transformation agenda be made to engender the welfare of rice farmers through the development of the rice value chain. The need for actively involving the rice farmers through the RGAN is also germane. The opportunities identified in the study include: having “pool of land” RGAN that enables the rice farmers to form clusters and increase production, creating platform through which the rice growers could leverage to facilitate access to inputs and technical support, and gaining of visibility and market access to enhance returns on their farming endeavours.
TopIntroduction
Given Nigeria’s discovery of crude oil in commercial quantity, agriculture that was once the prime mover of Nigeria’s economy suffered great neglect. The resultant effects include: sharp decline in agricultural production, increasing reliance on food import to meet the domestic demand, and so on. In effect, Nigeria is currently one of the largest food importers in the world with annual food import bill of about $10 billion (Obayelu, 2015). In 2016, the quantity of local rice production in Nigeria was estimated at 4.8 million tonnes (Food and Agricultural Organization-FAO, 2016). This further conforms to an earlier assertion by Ogunsumi, Ajayi, Amire and Williams (2013) on the gap between local demand and supply of rice in Nigeria. The author stressed that the level of rice consumption in Nigeria increases with about 10 percent per annum as a result of changing consumer preferences amidst other factors. The low productivity of rice farmers is occasioned by the use of low technologically empowered agricultural equipment which do not support large scale production. For instance, Fasoyiro and Yaiwo (2012)1 observed that in Nigeria, rice is mainly produced by small-scale farmers whose production are characterised by low output resulting from production inefficiency, aging farming population, low technological know-how, and so on. In the same vein Uduma, Samson and Mure (2016) noted that the inability of local supply to meet up with rice demand (consumption) has given rise to the high import of rice in Nigeria. According there has been a phenomenal rise in imports of 300 thousand tons annually in recent times which on the average with an estimated cost of 300 million naira annually in foreign reserves. They further stressed that aside from the huge cost to the Nigerian economy, rice imports exposes the country to international market shocks with its associated risk implications on food security.
This is contrary to what obtained a foretime where Nigeria used to be the largest producer of a number of crops including rice in West Africa (Okoruwa, Jabbar & Akinwumi, 1996; Obayelu, 2015). However, in 2010 there was somewhat re-awakening in the agricultural sector with the launch of the Agricultural Transformation Agenda (ATA). The ATA was part of the Federal Government of Nigeria’s (FGN) effort to revamp the sector in order to enhance food security, job creation and diversification of the economy (Osabuohien, 2014; Obayelu, 2015; Osabuohien, 2016). The transformation agenda as enshrined in ATA is set to create over 3.5 million jobs from rice, cassava, sorghum and cotton value chains, with more jobs to come from other value chains when fully implemented. Generally, ATA, among others, has the goal of re-defining agriculture as a business by promoting the involvement of private sectors, encouraging the expansion of private sector driven marketing organisations, and promoting incentive-based risk sharing for agricultural credits (Osabuohien, 2016; Okodua, 2017; Osabohien, Osabuohien & Urhie, 2017).
Rice is one of the crops being considered under the FGN’s ATA given its growing importance and prominent role among staple food crops in Nigeria. The country has a history of indigenous rice production and high demand (Johnson, Takeshima, & Gyimah-Brempong, 2013).Thus, it is not surprising that rice has emerged as a major staple food crop in Nigeria, given its demand in all the six geopolitical zones, 36 States, all the Local Governments, and across all socio-demographic groups (Gyimah-Brempong, Johnson & Takeshima, 2016). The increasing domestic demand for rice in Nigeria has been attributed to consumer preferences, increasing incomes, rising urban population, among others (Nwanze et al., 2006).