Investing in rice milling factory

Rice consumption in Nigeria is over 20 million metric tons per annum. Imported rice constitutes about 85 percent of the consumption level. The amount of foreign exchange spent on rice importation in Nigeria is in millions of dollars, on annual basis. Encouraging local production will save the country a lot of foreign exchange.

Encouraging rice production will assist the country to achieve self sufficiency and assertion of its sovereignty. Relying on other countries for food is an indication of a failed state.

Locally produced rice is more palatable and more nutritious than polished imported rice. In this regard, demand is guaranteed. Establishment of rice mill will encourage farmers to grow more rice.

Other positive contributions of the project into the economy are jobs and income creation, increased food production, stemming of hunger and starvation, rural development, poverty eradication and reduction in social vices. You will all agree with me that these are all ingredients towards economic development and emancipation of any country. The beauty of this project is that no portion of the rice is thrown away. Rice bran, a by-product of rice milling, is now used to feed livestock such as chickens, pigs and cattle.

Technical information

Rice milling involves getting a medium sized warehouse where the machines are installed. On installation, paddy rice is procured from rice producing areas of the country. Rice milling processes are parboiling, drying, milling and packaging. Serious minded investors can be assisted to set up this project.

Financial implication

1. Pre-investments : N100,000

2. Accommodation : N500,000 (Rent)

3. Plant and machinery : N2,500,000

4. Utilities/Working Capital: N1,500,000

Total N4,600,000Profitability analysis

The plant has capacity of milling 250 metric tons of rice per annum. Net profit of N40,000 per ton of milled rice has been computed. This translates to annual net of income of N10 million. This is a project that can positively contribute to Nigeria’s economic development.

Author’s contact: 08023058045, 08033660177, olumakindeoni@yahoo.com.

OLUMAKINDE ONI