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Exclusives

Price of foreign rice, beans, onions drop across major markets as borders gradually reopen

This report contains information on items that witnessed price increase, price decrease, as well as information on special markets and market insights.

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prices of food items, SBM Jollof Index, Smuggling of imported rice hits Lagos major markets, as residence brace for shutdown

The price of foreign-made rice has trickled down significantly in major markets in Lagos State, partly attributable to the recent directive by the federal government of Nigeria to reopen the country’s land borders.

This is according to the latest market survey, carried out by Nairalytics Research – the research arm of Nairametrics.

Nigerians may enjoy some respites going into the Christmas festivities as the price of a 50kg bag of Royal Stallion rice now sells for an average of N26,125 from an initial average of N30,333, representing a 13.9% decrease in price.

READ: Prices of food items rise across major markets as traders fear low patronage in December

The survey further showed that a 50kg bag of Caprice reduced by 10.43% to sell for an average of N26,125 as against an initial average of N29,167 recorded in November 2020. Meanwhile, the price of local rice has remained sticky as a 50kg bag of Mama’s Pride sells for an average of N23,375.

The report highlights information on items that witnessed price increase, price decrease, as well as information on special markets, and insights.

READ: Prices of rice, tomatoes, frozen foods increase in September as traders lament low turnover

Items that witnessed price increase

  • The price of a big basket of oval-shaped tomatoes increased by 11.1% to sell for an average of N10,000, as against an initial average of N9,000 recorded weeks ago.
  • A small basket of the oval-shaped tomatoes increased by 9.1% to sell for an average of N6,000 compared to an initial average of N5,500.
  • A big bag of pepper now sells for an average of N20,000 from an initial average of N17,000. This represents 17.65% price increase in three weeks.
  • Also, a medium-sized bag of pepper sells for an average of N10,000 from an initial average of N8,000, indicating a 25% increase in price.
  • A big basket of round shaped tomatoes currently sells for an average of N15,000, compared to N13,000 recorded three weeks ago, it increased by 15.38% in price.
  • A medium-sized basket of tomatoes increased by 6.25% to sell for an average of N8,500 from an initial N8,000, while a small basket size spiked by 10% to sell for an average of N5,500.
  • 5kg cylinder of cooking gas is currently filled for an average of N3,975, representing 15.22% increase in price compared to an initial average of N3,450.
  • Also, a 5kg cylinder that was initially filled for an average of N1,625 now sells for an average of N1,750 indicating a 7.69% increase in price.

READ: Share buyback: Dangote shares gain 10% in early trading as investors launch full bids

Items that witnessed price decrease

  • A 50kg bag of Royal Stallion rice sells for an average of N26,125. This represents 13.9% decrease in price compared to an average of N30,333 recorded three weeks ago.
  • Also, a 50kg bag of Caprice recorded a 10.43% decrease in price from an initial average of N29,167 to sell for an average of N26,125.
  • A 50kg bag of brown beans that was initially sold for an average of N43,250 now sells for an average of N41,500 representing 4.1% decrease in price.
  • The price of a 50kg bag of Mama’s Pride rice (Local) decreased marginally by 0.49% to sell for an average of N25,375.
  • The price of a big bag of Bush mango seed (Ogbono) reduced by 4.17% to sell for an average of N115,000 as against an initial average of N120,000.
  • The price of a big bag of dry onions dipped by 2.05% to sell for an average of N95,500 compared to an initial average of N97,500.
  • A big bag size of new onions also recorded a decline in price, as it currently sells for an average of N65,000 moving by 7.14% compared to an initial average of N70,000.

READ: Poultry owners jack up prices of chickens, others, as Nigerians abandon imported frozen foods 

Items that maintained initial prices

  • A big basket of Sweet potatoes sells for an average of N5,500, a small basket sells for an average of N700 while the smallest basket is sold for an average of N325.
  • Also, a big basket of Irish potatoes sells for an average of N20,000, same as recorded three weeks ago.
  • A 50kg bag of Honey well and Mama Gold flour sells for N13,950 and N13,850 respectively after witnessing a significant spike in price last month.
  • A carton of full chicken is sold for an average of N14,167, turkey (N19,000) while Chicken lap is sold for an average of N14,000.
  • A big bag of yellow maize continues to sell for an average of N23,333 while white maize sells for an average of N23,167.
  • A big tuber of yam is sold for an average of N763 while a medium size is sold for an average of N525.
  • A 50kg bag of garri (Ijebu) still sells for an average of N14,375 while white and yellow garri sells for an average of N10,750 and N11,125 respectively.

READ: Bitcoin drops $900 after hitting a lifetime high

Special markets/items

The price of onions is yet to normalize after a recent surge in prices.  Meanwhile, despite the sustained increase in the price of the commodity, large quantity of onions could be sighted at the onion section of the Mile-12 market as consumers buy in large quantities.

According to an onion seller at the market, he stated that the reason for the large quantity of onion in the market is because of the festivity as the item is always in high demand during the period.

The closure of Nigerian land borders in 2019 resulted in influx of various brands of local rice in the Nigerian market. Meanwhile, the latest survey showed that the prices of local rice remained high. Below are some of the brands of locally produced rice sighted at the various markets and their respective prices.

Ultimate Gold (N23,000), Umza (N24,500), Big bull (N25,500), Mamaan (N22,000), Mama’s Pride (N25,000), and Mama’s Choice (N25,000).

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Market insights

The reduction in the price of foreign rice may be partly attributable to the directive by the federal government to reopen closed land borders in Nigeria. In a discussion with a major rice dealer at Daleko Market, Mrs. Dayo, she explained to Nairalytics that the price of foreign-made rice has reduced significantly to N25,000 in the market. She explained further that, although traders are not allowed to bring in rice from these borders, the price has still recorded a significant decline in the past week.

In an interview session with Mr. Chukwuma, a rice dealer at Daleko Market, he told Nairalytics Research that it is indeed good that the price of foreign rice has declined, but quite bad that locally produced rice that is expected to cost far lesser is still sold for a high price.

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According to him, locally produced rice of superior quality is sold within the range of N25,000 and N27,000 while imported rice sells within the same range or even lesser for some unbranded foreign rice.

While discussing with another rice dealer at Mile-12 market by the name, Mrs. Chizoba. She told Nairalytics that although sales have not picked up, transactions are expected to increase later in the week due to the festive period.

ItemsBrandUnitMUSHIN (17/12/2020)DALEKO (17/12/2020)OYINGBO (17/12/2020)MILE 12 (17/12/2020)Average MUSHIN (26/11/2020)DALEKO (26/11/2020)OYINGBO (26/11/2020)MILE 12 (26/11/2020)Average
Bag of RiceMama Gold10kg4600480048005000480046004800480050004800
Bag of RiceRoyal Stallion50Kg260002550026000270002612530000 NA300003100030333.333333333
Bag of RiceRice Master10kg5000 NA450047505000 NA45004750
Bag of RiceMama Gold50kg26000255002600027000261252950029500300003000029750
Bag of RiceCaprice50kg260002550026000270002612529000 NA290002950029166.666666667
Bag of RiceMama's Pride50kg25500250002500026000253752550025500250002600025500
Bag of BeansOloyin50kg20000210002100020000205002000021000210002000020500
Bag of BeansWhite50kg40000430004500043000427504000043000450004300042750
Bag of BeansBrown50kg43000380004200043000415004300042000450004300043250
Tuber of YamAbuja1 Big Size Tuber800750700800762.5800750700800762.5
Tuber of YamAbuja1 Medium Size Tuber550500550500525550500550500525
Carton of NoodlesIndomie305g (Belle full)32003250330033003262.532003250330033003262.5
Carton of NoodlesIndomie200g (Hungry man)3200320032003200320032003200320032003200
Carton of NoodlesChikki100g2200220021002300220022002200210023002200
Carton of NoodlesMinimie70g19001750170018001787.519001750170018001787.5
Carton of NoodlesGolden Penny70g1700150016001600160017001500160016001600
Bag of GarriIjebu80kg14500140001450014500143751450014000145001450014375
Bag of GarriWhite50kg10500110001100010500107501050011000110001050010750
Bag of GarriYellow50kg11000110001150011000111251100011000115001100011125
Basket of PotatoSweetBig Basket5500550055005500
Basket of PotatoSweetSmall Basket700700700700700700
Basket of PotatosweetSmallest Basket400250325400250325
Basket of PotatoIrishBiggest Basket200002000020000200002000020000
Basket of PotatoIrishMedium Basket2500250025002500
Basket of PotatoIrishSmall Basket170015001600170015001600
Packet of PastaGolden Penny500g4400440043004200432544004400430042004325
Packet of PastaDangote500g4200430043004300427542004300430043004275
Packet of PastaPower (1 pc)500g250230250230240250230250230240
Packet of PastaBonita (1 pc)500g220230230220225220230230220225
Gallon of Palm OilLocal5 Litres2700260028002600267527002600280026002675
Gallon of Palm OilLocal25 Litres13000130001300013000130001300013000130001300013000
Gallon of Vegetable OilLocal5 Litres3400340035003400342534003400350034003425
Gallon of Vegetable OilLocal25 Litres16000170001700016500166251600017000170001650016625
Gallon of Vegetable OilKings5 Litres3200300030002800300032003000300028003000
Gallon of Vegetable OilWesson5 Litres4500390039004300415045003900390043004150
Gallon of Vegetable OilMamador3.8 Litres25002450250028002562.525002450250028002562.5
Gallon of Vegetable OilPower3 Litres1900180018002200192519001800180022001925
Bunch of PlaintainPlantain1 Big Bunch500600500600550500600500600550
Bag of FlourDangote50kg13600136001380014000137501360013600138001400013750
Bag of FlourHoney well50Kg14000136001400014200139501400013600140001420013950
Bag of FlourMama Gold50kg13800136001400014000138501380013600140001400013850
MilkPeak Powdered (Tin)400g12001300120012501237.512001300120012501237.5
Milkpeak Powdered(Tin)900g2800275027002750275028002750270027502750
MilkPeak milk (Refill)500g1200110012001200117512001100120012001175
MilkDano Powdered (Tin)500g1200120011001200117512001200110012001175
MilkDano Powdered(Tin)900g2600250024002500250026002500240025002500
MilkDano (Refill)500g100095010001000987.5100095010001000987.5
MilkThreeCrown (Refill)380g800750800750775800750800750775
MilkLoya Powdered (Tin)400g10001100110010501062.510001100110010501062.5
MilkLoya (Refill)400g900800850800837.5900800850800837.5
MilkCoast (Refill)500g750750750750750750750750750750
Cocoa BeveragesMilo (Tin)500g1500145015001450147515001450150014501475
Cocoa BeveragesMilo (Tin)1kg25002450240025002462.525002450240025002462.5
Cocoa BeveragesMilo Refill500g1100110010001100107511001100100011001075
Cocoa BeveragesBournvita Refill500g1300130012001300127513001300120013001275
Cocoa BeveragesBournvita (Plastic)900g2200220023002200222522002200230022002225
Cocoa BeveragesOvaltine Refill500g10009001000950962.510009001000950962.5
Cocoa BeveragesOvaltine(Plastic)500g15001500145014001462.515001500145014001462.5
CoffeeNescafe Classic50g600600600600600600600600600600
TeaLipton Yellow label52g300290300300297.5300290300300297.5
TeaTop tea52g300300300300300300300300300300
SugarSt' Louis Sugar(Cube) 500g600600600550587.5600600600550587.5
SugarGolden Penny Sugar (cube)500g400350400400387.5400350400400387.5
BreadVal-U1 loaf450450450450450450450450450450
BreadButterfield1 loaf450450400450437.5450450400450437.5
EggN/ACrate12001200125012001212.512001200125012001212.5
Bottled Water (Refill)CwayRefill600650600600612.5650650650650650
Juice5 Alive1 litre550550550600562.5550550550600562.5
JuiceChivita1 litre550550600550562.5550550600550562.5
GasRefilling12.5kg4000400039004000397535003400340035003450
GasRefilling5kg1700180018001700175016001600170016001625
TomatoesBig Basketround shaped15000150001300013000
TomatoesMedium Basketround shaped8500850080008000
TomatoesSmall Basketround shaped5500550050005000
TomatoesBig BasketOval Shaped100001000090009000
TomatoesSmall BasketOval Shaped6000600055005500
FishKote (Horse Mackerel)1 kg650600600600612.5650600600600612.5
FishTitus (Mackerel)1 kg600650650650637.5600650650650637.5
PepperBig bag20000200001700017000
PepperMedium bag100001000080008000
MaizeYellow25000220002300023333.33333333325000220002300023333.333333333
MaizeWhite25000225002200023166.66666666725000225002200023166.666666667
MelonBig bag435004350043500435004400043750
OnionsBig bagDry Onions9400097000955009500010000097500
OnionsBig bagNew Onions650006500065000700007000070000
Bush mango seed(Ogbono)1 big bag115000115000120000120000
Frozen foodFull chickenCarton14500140001400014166.66666666714500140001400014166.666666667
Frozen foodChicken lapCarton1400014000140001400014000140001400014000
Frozen foodTurkeyCarton1900019000190001900019000190001900019000
CrayfishNylon125001350013000125001350013000

About Nairametrics Food Price Survey

Nairametrics Food Price Watch, is a bi-weekly Household Market Survey that covers the prices of major food items in Nigeria, with emphasis on five major markets in Lagos – Mushin market, Daleko market, Oyingbo market, Idi-Oro market, and Mile 12 market.

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Nairametrics Research team tracks, collates, maintains and manages a rich database of macro-economic and micro-economic data from Nigeria and Africa. Our analysts share some of the data collated on Nairametrics, using formats such as docs, tables and charts etc. The team also publishes research based analysis as articles on a regular basis.

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Blurb

Dangote Sugar, sweet in more ways than one

Significant growth in gross revenue was driven largely by sale to Nigerian Bottling Company Limited and Seven-Up Bottling Company Limited.

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Quick take: Sustained cost pressure weighs on profit, Dangote Sugar Refinery: Revenue recovers but cost pressures remain

By refining capacity, Dangote Sugar Refinery Plc (DSR Plc) is acknowledged as the largest Sugar Refinery in sub-Saharan Africa and one of the largest in the world. With up to 60 percent market share, it is also clearly, the most dominant player in the Nigerian sugar market.

DSR Plc recently released its audited Financial Statements for the year ended December 31, 2020 and overall and year-on-year group performance results were very good.

Despite the impact of the Covid-19 induced lockdown which curtailed distribution across the country and resulted in decreased revenues from income generated from freights, gross revenues increased by over 33 percent year-on-year to ₦ 214.3 billion. The significant growth in gross revenue was driven largely by a rise in revenue from the sale of its 50kg sugar, with the two main customers being the Nigerian Bottling Company Limited and Seven-Up Bottling Company Limited who operate principally from Lagos.

READ: Dangote Sugar completes acquisition with Savannah Sugar Company Limited 

Year-on-year, gross profit increased by over 40 per cent to ₦ 53.75 billion, Profit before tax increased by almost 53 per cent to ₦ 45.62 billion, and Profit after tax increased by 33 per cent to ₦ 29.78 billion.

Notwithstanding the good result, the group operating results showed some issues and headwinds. First, during the year, DSR Plc wound up Dangote Niger Sugar Limited (one of four companies that had been set up to acquire large expanse of land and locally grow sugarcane as part of its concerted backward integration project). The winding-up was sequel to continued community dispute over land acquired in Niger State for this purpose. This winding-up event cost DSR Plc approximately ₦ 100 million.

Second, there continues to be a heavy reliance on Lagos for its gross revenues as revenues generated from Lagos State increased significantly from circa 33 per cent at the end of 2019 to over 50 per cent by the end of 2020. The share of the Lagos segment in gross revenue thus continued to grow and currently represents a significant market concentration risk for DSR Plc.

READ: Nigeria’s biggest oligopolies: Who are the real beneficiaries?

Third, provision for impairment on financial assets or in simple terms, receivables that are unlikely to be collectable, also trended upwards from ₦ 1.3 billion in 2019 to ₦ 1.45 billion by end of 2020 with net financing expenses also rising significantly from ₦ 516.2 billion in 2019 to ₦ 1.92 billion by the end of 2020. This rise in expenses was largely driven by a significant rise in exchange losses incurred in the ordinary course of business, rising from about ₦ 7 million in 2019 to over ₦ 1.57 billion at the end of 2020.

Finally, administrative expenses represented mainly by employee salaries grew year-on-year by over ₦ 1.2 billion.

With the recent reopening of land borders, we expect that revenues and margins will become squeezed as sales and production volumes become constrained by the influx of largely smuggled, lower quality, and much cheaper sugar and its substitutes. DSR Plc’s sugar refinery is also strategically located very close to the Apapa port and its logistics operations, distribution of raw materials and delivery of finished goods will continue to be impacted by the infamous Apapa Traffic Gridlock and road diversions/closures around the axis. Although the effort of Lagos state and the recent introduction of the electronic call up of truck by the NPA has eased the issue, still, it needs to be watched closely.

READ: Dangote Sugar yearly revenue surge by 33%, announces a dividend of N1.50

Earnings per share at the end of 2020 was ₦ 2.45 (2019: ₦ 1.87; 2018: ₦ 1.85)

Subject to approval at its forthcoming Annual General Meeting, DSR Plc board of directors have proposed a dividend of N1.50k per ordinary share (2019: ₦ 1.10k, 2018: ₦ 1.10k).

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This performance is sweet in more ways than one.

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Exclusives

The Nigerian economy is increasingly dollarized but there is a way-out

Nigeria’s overdependence on Oil has brought about high dollarization in Africa’s biggest economy.

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For managers of the Nigerian economy, it was a huge sigh of relief when the National Bureau of Statistics reported that the country had surprisingly exited a recession in the 4th quarter of 2020. Contrary to most analyst expectation, the Nigerian economy grew by 0.11% in the 4th quarter of 2020.

Despite the return to growth, albeit tepid, a dark cloud of uncertainty continues to hover over the minds of millions of Nigerians as the broader economy remains in a fragile state. A key factor that remains a bellwether for the economy is the exchange rate, which is always perfectly correlated with the price of oil and the resultant dollar related export earnings.

Data has repeatedly shown that the country of over 200 million people is affected by the volatility of crude oil prices in the international market, particularly in the exchange rate value of the naira. Without oil, the Nigerian economy in its current state will collapse.

Data from Nairalytics, a data-sharing portal, reveals that the oil sector provides for 85% of Nigeria’s export earnings and 55% of its government revenues, making the nation highly dependent on the dollar for its survival. It appears a lot of financially savvy Nigerians now this already and are increasing their dollar positions.

According to Silas Ozoya, Founder/CEO of SUBA Capital LLC, in an exclusive interview with Nairametrics, a growing number of Nigerians are getting more attached to the US dollar due to high inflation and low purchasing power of the naira.

“Many Nigerians are beginning to dollarize their spending, investment and asset holdings to hedge against the ever-increasing inflation rate and our strong economic romance with recession,” Ozoya said.

Nigeria, Africa’s biggest crude oil producer, has been heavily impacted by the plunge in crude oil prices following the outbreak of the COVID-19 pandemic, with the nation’s authorities adjusting the naira twice in the year 2020 to deal with the pressure.

Besides the drop in foreign exchange revenues from crude oil export, diaspora remittances, which made up about 5% of Nigeria’s GDP in the year 2019, also experienced a significant decline in 2020, again due to the impact of the pandemic and the economic challenges faced by many nations across the globe.

Uwa Osadiaye, a financial analyst in a leading merchant bank, in a note to Nairametrics, revealed that the Nigerian apex bank had made great efforts to reduce the country’s high dependence on the dollar. He advised the nation to increase its Agricultural production.

“The central bank has tried to do this with little success but I believe that beyond administrative measures, the key could lie in increased domestic production of things we consume that aren’t commoditized internationally for a start, such as food crops,” Osadiaye said.

Temitope Busari, CFA, in a telephone interview with Nairametrics, said that it was time for Nigeria as a country to diversify.

“One outcome of the diversification of the Nigerian economy, and perhaps the most critical one at this time, is the potential to diversify our foreign exchange earnings as a sovereign state. It will reduce overdependence on crude oil, maximize opportunities in erstwhile neglected sectors and project the country as the destination for top-class value creation in other areas outside being an oil-producing state,” Busari stated.

The financial analyst also spoke on the need for Africa’s leading oil producer to invest more in intellectual property and encourage Nigeria’s talent in the diaspora, saying:

“We have produced some of the most brilliant minds in the world evidenced by the ground-breaking successes recorded by Nigerians in diaspora (Medical professionals, Software engineers, resilient small business owners to mention a few), and we must begin to drive policies to retain that talent in-country and make the world pay premium dollar for it.”

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Adetayo Teluwo, a scholar at Warwick Business School, said that the narrative seems to be changing as Nigerians are now beginning to embrace homemade goods.

“The Fashion & Style scene continues to boom. From side hustles to globally-competitive websites with options to accept payments from customers all over the globe,” Teluwo said.

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Bottom line

Economic experts believe that the way to solve this growing menace is for Nigeria to promote free markets and support large scale exports from the Agricultural, Mining, and Technology sectors. The country should tap into its raw diamond which is “intellectual services” to develop a knowledge economy.

Nigeria can draw lessons from India, which has performed remarkably well in creating an outsourcing and knowledge-based economy valued at over 150 billion dollars per annum. This has put India on the technology map, as a destination of low-cost but high-quality technical services, helping the densely populated nation to generate sufficient economic ripple effect to drive job and wealth creation.

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