Dangote Rice, a subsidiary of Dangote Group, is set to launch in Sokoto, Sokoto state its multi-million naira 25,000 hectares of rice outgrower scheme with a prospect of hundreds of thousand of employment opportunities for the rural communities inhabitants.
The President of the Group, Aliko Dangote, disclosed at the weekend that the Company will on Wednesday flag off with a pilot project of 500ha by Gonroyo Dam in Goronyo community.
Gonroyo Dam is the second largest in the country, after Kainji Dam.
The flag off ceremony, which will be performed by the Governor of Sokoto State, Alhaji Aminu Tambuwal, 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 State out of the 14 states spread across the country where Dangote Rice plans to operate outgrower schemes 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, while diversifying Nigeria’s economy and reducing the nation’s food import bill.
Statistics from the Federal Ministry of Agriculture and Rural Development 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 Nigeria to satisfy 4 per cent of the total market demand within one year.
The company said the model can then be successfully scaled to produce 1,000,000 MT of milled rice in order to satisfy 16 per cent of the domestic market demand for rice over the next five 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. Dangote Rice Limited said it seeks to take advantage of the economic trend and the favourable policies laid out in the FMARD’s Agricultural Transformation Agenda.
Dangote Rice has a mandate to locally produce high-quality milled, parboiled rice for the Nigerian market.
This goal, it said, will be achieved by sourcing the raw material (paddy) required from the Dangote Rice Outgrower Scheme.
Through the Dangote Rice Outgrower Scheme, Dangote Rice Limited 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 in 2017, Dangote Rice will have 25,000 Ha under rice cultivation across three 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.
The company 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 be used to store the paddy rice from all three sites.