In my discussion with a colleague about the skyrocketing price of rice and blaming it on flooding, he asked a significant question.

He asked me if Nigerians consume more local rice than foreign rice. I told him I "think" we consume more foreign rice and he was like if we eat more imported rice, how come the flood of a few days in Nigeria suddenly became responsible for the absurd hike in price?

I couldn't really wrap my head around his reasoning. If he is right, then something is amiss. Do most Nigerians really depend on local rice?

Please share your thoughts on this.

Flood is not responsible because no news of warehouses being affected by the flood. What I hear people say is the flood affects farms. The local rice that will be sold throughout this year was harvested and processed long time ago and is already in market stores. Nigerians are experts in using flimsy reasons to create serious artificial scarcity.

It is more logical to blame exchange rate than to blame flood for the rice price. Even the exchange rate is not meant to affect rice price now because over 98% of foreign rice that will be consumed in Nigeria this year was imported and cleared when Naira was below 700 per Dollar.

If they say the flood affects warehouses, then I will believe the flood is responsible for the rice price.

He made that point too. Very insightful!

Market is much more volatile in reality than it looks in theory. The flood affected output and farmers already know what is about to happen, in addition, some distributors are always on the edge for the next excuse to justify their ever-iminent price increase.

Even foreign rice cannot remain the same given the fact that there is a global inflation trend. When wheat goes up in price due to Russia war in Ukraine, direct substitute like corn, rice and cassava are bound to adjust in same direction slightly.

The world is moving to a global village rapidly than most people realize.