Nigeria Rice Output Forecast: Autoregressive Integrated Moving Average (ARIMA) Approach

Abstract

Nigeria has implemented various policies and programs aimed at ensuring self-sufficiency in rice production since 1970. The trade policy instruments employed included tariffs, quotas, subsidies, import restrictions and outright ban on rice import at various times. All these policies failed to bridge ever increasing demand-supply deficit in rice production. However, there is considerable potential for expansion of rice production in the five rice-growing ecosystems in Nigeria in order to attain self-sufficiency. The current government has again placed a total ban on the importation of rice with the target of attaining self- sufficiency in rice production by 2020. Given the current production level, this study intended to forecast the rice output from 2018 to 2025 so as to ascertain the likelihood of attaining the self-sufficiency level within the target period, and also to describe trends in rice output from 1980-2016. The study was based on annual time series data collected on national rice output from 1980 to 2016. Descriptive statistics and ARIMA (111) model were used to analyze data collected. Results shows that on the average, national rice output maintain a steady increase of 69% per decade from 1980 to 2016, with the peak of 93% increase recorded within the years 2000- 2009. Given the current production environment, the national paddy-rice output was projected to reach 7.4 million tonnes (equivalent of 4.9 million tonnes of milled-rice) by the year 2020. This is short of 6 million tonnes of milled-rice target. However, the projected result also show that self-sufficiency level of 6 million tonnes of milled rice (about 10 million tonnes of paddy-rice) could only be attainable by the year 2025. It is recommended that until 2025 when the country was projected to attain self-sufficiency in rice production, effort should be geared towards bridging demand –supply gap by ensuring strict quota policy of rice import. This would eliminate price increase associated with disequilibrium in demand –supply of rice commodity in the market.