Nigeria is one of over 100 countries that use rice as a staple food. It also boasts the biggest economy in Africa and the world’s eighth-largest arable land mass. These factors should position Nigeria as one of the top rice exporters worldwide. Yet, the country’s rice production value chain is fragmented. 

Nigeria is the leading rice producer in Africa. Yet, due to insufficient production, it is a net rice importer. That high import amount has been coming down over the last few years. The demand-supply gap for rice in Nigeria has also been going down. This can be attributed to two aspects of the sector—the increase in rice production and the decrease in imports. 

From 2015 onwards, rice production almost doubled, halving rice imports. This is due to a government program to develop the value chains of rice production. After six years of the project, rice production in Nigeria has changed completely.

This case study will focus on Nigeria’s initial challenges in this sector. We will examine the country’s challenges in reaching export quality and learn what it did to tackle these challenges. We will focus on one key challenge: optimizing rice production in Nigeria. By the end of this case study, we will better understand the entire process and how Nigeria worked to overcome the challenges of rice production value chains.

Get insights into how Nigeria transitioned from a major rice importer to strengthening its production chains and reducing imports by half since 2015.

Get an overview of Nigeria’s difficulties, including outdated agricultural practices, insufficient infrastructure, and subpar grain quality.

Explore the Nigerian government and IFAD’s collaborative efforts to empower farmers, improve production techniques, and transform the rice industry.

Learn how farmers gained business management skills and the younger generation engaged in agribusiness through targeted training and resources.

Discover the program’s outcomes, including a 125% increase in yields, 70% reduction in post-harvest losses, and Nigeria’s enhanced potential to become a global rice exporter.

Nigeria had struggled to produce high-grade export-quality rice for some time. This failure was attributed to various reasons. Outdated agricultural practices and lack of infrastructure to store were some of them. Inadequate post-harvesting handling techniques led to much waste and sub-par grain quality.

A big challenge was the absence of quality control at each value-added point. Because of that, the grains being produced were not up to the standards needed for exporting. Due to these factors, Nigeria failed to establish itself as a reliable rice exporter. This gradually limited the country’s access to global markets, threatening its economic stability. Addressing these issues became crucial to ensure the viability of Nigeria as an exporter. Nigeria also needed to establish rice as an essential export commodity. 

Much effort went into solving the challenge of producing export-quality rice in Nigeria. However, the program that should be credited with the solution is VCDP. The Nigerian government organized the Nigerian Value Chain Development Program, which was funded by the International Fund for Agricultural Development (IFAD). Olam Group, a renowned agribusiness in Nigeria, was also a key partner.

The International Fund for Agricultural Development (IFAD) is an international financial institution and an agency of the United Nations that works to alleviate poverty and hunger in rural areas of developing countries.

The Nigerian government launched the Value Chain Development Program (VCDP) in 2014. It was funded by IFAD and partnered with the agribusiness Olam Group. The program already worked with 22,500 farmers. Its main goals were to strengthen value chains and empower rice-producing rural farmers. 

The program was initially planned for six years and six states. Due to increased funding from partners, it was expanded to nine states. IFAD covered 65 percent of the US$330.5 million budget, while cofinanciers covered 11 percent. The local private sector covered 16 percent, and beneficiaries covered 7 percent.

VCDP-Nigeria helped the country’s rice farmers in many ways. For example, it introduced them to modern farming techniques and processing technologies. It also helped them gain better access to markets and improve their income. Projects focused on capacity building and training these farmers. This program played an essential role in reshaping Nigeria’s rice production sector.

The VCDP had many impactful and strategic projects that helped transform the rice production sector. Implementing such a vast program had to be done in phases. The strategic partner, Olam Agri, significantly contributed to the program’s implementation.

The program was implemented across nine states in Nigeria. They are- Anambra, Benue, Ebonyi, Enugu, Kogi, Nasarawa, Niger, Ogun, and Taraba. Its goal was to help farmers reduce their post-harvest losses through modern techniques. The first aim was to build a strong public-private producer partnership (4Ps), which helped pave the pathway for the transformation that was to take place.

IFAD worked to provide farmers with a better network of processors and markets. One such organization was the Community Alliance Forum, or CAF, located in the southeastern state of Enugu. Through these organizations, IFAD ensured the farmers would get the right price. The CAF negotiated the markets for the farmers to provide the best prices. 

The VCDP was not just about increasing rice production in Nigeria. It also aimed to empower farmers through knowledge, education, and training. The training helped develop capacity and transform these farmers into business managers. Business skills like record keeping and market analysis were taught to maximize profits. With this newly learned knowledge, many farmers quickly turned their lives around. 

IFAD realized the potential of the younger generations in the rice production industry. They started enabling the youth with the help of local organizations. One such organization was the Eredo Youth Cluster in Nigeria’s Ogun State, which provided them with knowledge, training, and resources for rice farming. The resources included agricultural land, high-yield quality seeds, fertilizers, etc.

After the conclusion of the six-year program, it has been a resounding success. Over the six years, the program helped farmers increase production. VCDP also enabled them to transform their professions from farmers to agribusinessmen. Since its start, the farmers have produced well over 450,000 metric tons of rice till its end. 

The participating rice farmers saw their yields increase by 125%. Modern farming techniques also helped them reduce post-harvest losses by 70%. Over 3,500 farming organizations benefited from the training programs, which taught record-keeping and business planning. During the program’s six years, over 3,292 purchase agreements were signed between the farmers and major buyers. 

These results have enabled rice farmers in Nigeria to move from subsistence farming to commercial agriculture. Compared to previous years, this has also increased the export of rice. Market leaders like Olam have positioned Nigerian rice more competitively in global markets.

Nigeria’s road ahead is also very challenging, but it has a more robust base now to face those challenges. It should now develop an exclusive export network for local farmers and processors. They should also follow in the footsteps of other top rice exporters worldwide. The Government must capitalize on this solid base and work on it further. 

The potential for rice farming in Nigeria is vast. With proper planning, implementation, and delivery, it can be significantly transformed. Nigerians would love to see the country, which has rice as its staple food, become an exporter of it.