Govt policy on rice, fish cripples break bulk terminals

Break bulk terminals at the ports are struggling to pay their bills and meet their financial obligations to the Nigerian Ports Authority (NPA) due to the plethora of banned products and the hike on import duties on others, SHIPS & PORTS DAILY can authoritatively reveal.

The hike in import duty on rice, the restriction imposed on the importation of fish and on cement are all taking a huge toll on the income of the break bulk terminals as their revenue has dipped by over 60 per cent.

The imposition of a 10 per cent import duty on rice and the increase in rice levy from 50 per cent to 100 per cent early this year is said to have had the most debilitating effect on the break bulk terminals as handling of rice cargo accounts for more than half of their revenue.

Investigation conducted by SHIPS & PORTS DAILY revealed that as a result of the measure announced in February through a circular signed by Central Bank of Nigeria (CBN) Director, Trade and Exchange, W. D. Gotring, not a single rice vessel has berthed at any Nigerian port over the past nine months as rice shipments meant for the Nigerian market are channeled through the port of Cotonou, Benin Republic, and smuggled in small quantity into Nigeria.

When contacted, operators of the major break bulk cargo terminals in Lagos and Port Harcourt including ENL Consortium, Greenview Development Nigeria Limited, Joseph Dam, and PTOL Terminal confirmed that they have not handled any rice vessel since March this year due to the 100 per cent rice levy and 10 per cent import duty.

“The importers and shipping lines no longer come here. Rice was our major commodity at this terminal. This is the season for rice but unfortunately here we are, the terminal has dried up. Not one vessel of rice is at the terminal. You can go see for yourself,” the chief executive of one of the general cargo terminals who will not want his name revealed informed SHIPS & PORTS DAILY.

The silent and abrupt ban on importation of fish by the Federal Government with effect from Novermebr 1, 2013 has further crippled the operations of most of the terminals as fish represents the second highest revenue earner for the operators.

Speaking in Lagos recently, General Manager of the major break bulk terminal in the country, ENL Consortium, Mr. Mark Walsh, said: “The government banned fish importation since October 31 this year. Before we were doing 20,000 tons of fish every month, but now, that is gone. Any bill of laden after that date cannot be brought to Nigeria. What we have coming in now are those imports with earlier bills of laden dated before October 31.

“I talked to a lot of the fish association and they have said that by the end of December, there will not be fish in the cold rooms. So it is a serious situation because it will affect everybody in the country.”

The ban on fish came barely three months after the Agriculture Minister, Mr. Akinwumi Adesina, disclosed at the inauguration of the Special Growth Enhancement Support Scheme for fisheries and the aquaculture value chain in Ado-Ekiti on August 6, that the federal government would soon place a total ban on the importation of fish and other aquatic consumables.

With annual fish demand estimated at 2.66 million metric tons (MMT), Nigeria currently produces about 0.78MMT leaving a demand-supply gap of about 1.8MMT.

“From the ban on cement to the increase in the tariffs on rice and now fish is no longer coming in, it has been very difficult. We have lost up to 800,000 tons since January this year. But you see rice in the market. All the vessels bringing rice are going to Cotonou and the rice is somehow making its way across the border.

“So, you can still go the market whether in Apapa or any other place anywhere in Nigeria and still find rice, why? So you can see there is a problem. Cotonou does not make rice. They are Thai rice, Indian rice getting into Nigeria somehow. So the government increasing the duty only affects the government itself because all the duty on that rice is going to the government of the Benin Republic,” Walsh said.

The ban on rice was imposed by the Federal Government last year.

It is estimated that the break bulk terminals have lost revenue running into billions of naira in one year.