Dangote Industries to invest $1bn in rice production in Nigeria

African business conglomerate Dangote Industries has agreed to invest around $1bn in rice production and processing operations in Nigeria.

The company has signed a memorandum of understanding (MoU) with the Federal Ministry of Agriculture and Rural Development to make the investments, as part of the country’s Agricultural Transformation Agenda (ATA) announced in 2011.

Nigeria President Goodluck Jonathan was quoted by the Guardian Nigeria as saying: "Today is a great day for Nigeria and this investment is worth the risk. The country is capable of producing rice that can feed the whole of [the] West African sub-region."

Dangote has bought 150,000 hectares of land in Edo, Jigawa, Kebbi, Kwara and Niger states, for the commercial production of rice.

Understood to be the biggest investment in rice production in Africa, the deal is expected to increase Nigeria’s output by 1.4 million tonnes.

Dangote Group chairman Aliko Dangote said: "Our goal of making Nigeria a net exporter of rice will be achieved faster by this significant investment, and I congratulate the Minister of Agriculture and his team for the very strong demonstration of public-private sector partnerships and collaboration to drive significant transformation in Nigeria’s agriculture sector."

Under the MoU, Dangote will also establish two rice mills with a processing capacity of 120,000t a year each. It would be doubled to 240,000t in two years.

Nigeria Minister of Agriculture Akinwumi Adesina said: "This investment by Dangote Industries Limited is transformational for Nigeria and the rest of Africa.

"The 150,000 hectares of rice farms and the planned 240,000t processing capacity of international quality grade rice is guaranteed to turn Nigeria away from being a rice importing country to a major rice exporter."

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Image: The investment is expected to increase Nigeria’s rice production by 1.4 million tonnes. Photo: courtesy of 9comeback / Freedigitalphotos.net.