News
Dangote to Launch 25,000 Hectares of Rice Outgrower Scheme.
DANGOTE Rice, a subsidiary of Dangote Group is set to launch in Sokoto state it’s multi-million naira 25,000 hectares of rice outgrower scheme with a view to providing hundreds of thousands of employment opportunities for the rural communities inhabitants.
The group’s President , Aliko Dangote made this known at the weekend that the Company will on Wednesday, flag off with a pilot project of 500 ha by Gonroyo dam, which is the second largest in the country, after Kainji situated in Goronyo community.
The flag off ceremony to be performed by the governor of the state, Alhaji Aminu Tambuwa will witness seedlings being distributed to the primary local farmers who will in turn plant the seed after which Dangote Rice company will purchase from them for milling and final processing.
Sokoto state is the second after Jigawa out of the 14 states spread across the state where Dangote Rice plans to operate outgrower scheme to empower local farmers and create job opportunities for community dwellers and reduce migration to the cities.
Dangote Rice projects in the 14 states, when, operational, will generate a significant number of jobs and increase take-home income for smallholder farmers, all while diversifying Nigeria’s economy and reducing the nation’s food import bill.
Statistics from the Federal Ministry of Agriculture and Rural Development (FMARD) estimates that rice demand in Nigeria reached 6.3 million MT in 2015, with only 2.3 million MT of that demand satisfied by local production.
This local production shortfall leaves a gap of 4.0 million MT that is currently being filled through formal importation of rice or illegal imports over land borders.
By year-end 2017, Dangote Rice plans to produce 225,000 MT of parboiled, milled white rice. This will allow us to satisfy 4% of the total market demand within 1 year. Our model can then be successfully scaled to produce 1,000,000 MT of milled rice in order to satisfy 16% of the domestic market demand for rice over the next 5 years.
Due to the current economic crisis, domestic prices for agro-commodities have risen dramatically over the last 12 months, making local agriculture an attractive investment
Due to the current economic crisis, domestic prices for agro-commodities have risen dramatically over the last 12 months, making local agriculture an attractive investment. Dangote Rice Limited seeks to take advantage of this economic trend and the favourable policies laid out in the FMARD’s Agricultural Transformation Agenda.
Dangote Rice has a mandate to locally high-quality milled, parboiled rice for the Nigeria market. This goal will be achieved by sourcing the raw material (paddy) required from the Dangote Rice Outgrower Scheme.
Through the Dangote Rice Outgrower Scheme, DRL will partner with outgrowers (smallholder and contract rice farmers) to cultivate and grow rice paddy. Specifically, DRL will provide inputs, technical assistance, extension services and land preparation services and equipment directly to farmers. At harvest, DRL will recoup the costs of inputs and services in-kind and will act as a guaranteed offtaker for paddy that meets certain pre-agreed quality standards. Smallholder farmers will provide land and labour.
The centralized outgrower model enables a high level of control over product quality and quantity. The purchasing price given to farmers will reflect each season’s market price and will be set after an extensive market price survey and consultation with all stakeholders.
In the short-term, Dangote Rice will be responsible for importing all of the inputs needed for cultivation and making them available to the outgrowers.
By end of 2017, Dangote Rice will have 25,000 Ha under rice cultivation across 3 sites in Northern Nigeria having identified rice-growing communities in Jigawa State (5,000 Ha), Sokoto State (10,000 Ha) and Zamfara State (10,000 Ha).
The 25,000 Ha will be farmed by nearly 50,000 outgrowers in the selected site areas. These outgrowers are already organized into cooperative associations. We will engage with these organizations to register and sign contracts with each farmer.
In addition to the outgrowers, an additional ~260 jobs will be created by year-end 2017. These individuals will serve as agronomists, credit officers and staff of the mill.
Upon harvest, Dangote Rice will offtake rice paddy and transport the paddy to be processed. One centralized mill will mill the stored paddy rice from all 3 sites.
Dangote Rice plans to produce one million MT of rice from 150,000 Ha in the next 5 years over. They intend to accomplish this by scaling the business model described above to more sites and rice growing communities. These communities have been identified and relationship building and sensitization has already begun. In addition to scaling the above model, DRL will establish and manage a high-quality seed development farm at Numan in Adamawa to reduce the costs of seeds.
Dangote Rice will establish raw material reception, drying, hulling, parboiling units and silos in strategic areas throughout the country near our additional outgrower communities. Each site will store dried, hulled, parboiled bran rice. DRL will then transport this bran rice to a mill, where finished rice will be produced.
The headquarters of Heritage Bank at Victoria Island, Lagos, was besieged on Thursday by members of the labour union, protesting the recent dismissal of 1,000 support workers.
The National President of the National Union of Banks, Insurance and Financial Institutions Employees, Comrade Anthony Abakpa, led the demonstration, condemning the bank’s management for what he deemed a lack of adherence to due process in the termination of employment contracts.
Speaking during the protest, Comrade Abakpa asserted that the leadership of Heritage Bank failed to follow established protocols before executing the mass layoffs.
He emphasised the union’s commitment to pursuing justice for the affected workers, vowing to escalate their demands until the bank’s management rectifies the situation.
“We will intensify our demands for justice,” declared Comrade Abakpa, urging the bank’s management to take corrective action to address the grievances of the dismissed workers.
The Governor of the Central Bank of Nigeria (CBN), Olayemi Cardoso, clarified that Nigeria is not utilising its foreign reserves to bolster the naira, despite recent fluctuations in reserve levels.
Speaking from Washington DC, where he is attending the International Monetary Fund-World Bank Spring Meetings, Cardoso highlighted the influx of $600 million into Nigeria’s reserves account within the past two days.
While the naira has experienced a notable appreciation against the dollar in recent weeks, climbing over 40% from approximately N1,900/$ to about N1,000/$1, Nigeria’s foreign reserves have been dwindling. As of April 15, reserves dropped to approximately $32.29 billion, marking the lowest level in over six years.
Cardoso emphasised that the shifts in reserves are typical for any country, where various financial obligations, such as debt repayments, necessitate withdrawals.
He stated, “What you’ve seen with respect to the shift in our reserves is normal in any country’s reserves where, for example, debts are due and certain payments need to be made. They are made because that is also part of keeping your credibility.”
Continuing, Cardoso underscored the dynamic nature of the market, advocating for a system driven by willing buyers, willing sellers, and price discovery.
He emphasised, “The shift in our reserves has really little or nothing to do with defending the naira, and that is certainly not our objective.”
Dangote Petroleum Refinery has made headlines by announcing a further reduction in the price of diesel, dropping it from ₦1200 to ₦1000 naira per litre.
The refinery’s decision comes on the heels of its recent supply at a significantly reduced price of ₦1200 per litre, which was introduced three weeks ago, signifying a remarkable 30 per cent decrease from the previous market price of approximately ₦1600 per litre.
This substantial reduction in diesel prices at Dangote Petroleum Refinery is expected to reiterate positively throughout various sectors of the economy, potentially serving as a catalyst in alleviating the persistently high inflation rate in the country.
In a statement last week, Aliko Dangote, Africa’s wealthiest individual and the owner of the refinery, expressed his optimism regarding the potential impact of the price reduction on inflation in Nigeria.
“I believe that we are on the right track. I believe Nigerians have been patient, and I also believe that a lot of goodies will now come through. There’s quite a lot of improvement because if you look at it, one of the major issues that we’ve had was the naira devaluation that has gone very aggressively up to about ₦1900,” he remarked.
As anticipation builds around the implications of this move by Dangote Petroleum Refinery, stakeholders and consumers alike remain hopeful for the positive effects it could bring to the Nigerian economy in the coming months.
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