The National Sugar Development Council (NSDC) has said that investing in local production of sugar is attractive for many reasons which include among others the existence of a large and growing domestic demand which is mostly import-dependent, coupled with an export market within Africa.
Kamar Bakrin, Executive Secretary, National Sugar Development Council in his presentation during a meeting with senior journalists in Lagos, said that macroeconomic environment, especially currency exchange rate, has made local production of sugar more competitive and importation more challenging, adding that the Nigerian Sugar market is valued at $2billion with access to a $7billion Africa market.
National Sugar Development Council is the agency with the mandate to develop and manage the sugar industry towards attaining national self-sufficiency in sugar production.
Bakrin further noted that the sector is future-proof due to a host community integration model that ensures sustainability as well as the wide variety of high-value products that can be produced such as ethanol, bioplastics, packaging materials etc.
The objective of the NSDC in 2025 is to accelerate project development, facilitate investment of $5billion into the sector, ensure investment readiness of priority greenfield projects, and strengthen NSDC’s capacity to develop the sector.
Read also: Nigeria now self-sufficient in refined sugar production – NSDC
Speaking further, he noted that the economics of investing in local production of sugar are compelling “with high Net Present Value (NPV) and Internal Rate of Return (IRR) at attainable scale, and available financing that matches the business need.”
“It is operationally feasible with access to land in secure parts of the country, and available global expertise to support local projects. There is a strong incentive framework and the government is committed to creating investment-friendly legislation,” Bakrin said.
Sugar production is an important driver of socio-economic development. There is a large and growing market for sugar and other high-value byproducts within Nigeria and Africa.
Speaking further, the Executive Secretary noted that NSDC is committed to driving the sugar sector to achieving self-sufficiency within 8 years.
Bakrin, who led the team of other senior to mid-level staff of NSDC during the presentation said, “We are taking deliberate action to accelerate local production. We are raising a pool of appropriate funding of the right quantum, cost and tenor to create capacity”.
“We are driving more aggressive expansion by existing players, entrance of credible local and global business groups and establishment of commercial sugar cane growers. Internally, we are upgrading capacity for training manpower for the industry, creating local varieties, multiplying seed cane and driving best practices through extension services,” he noted further.
The Nigerian Sugar sector has a fairly long history, starting with the establishment of the first sugar company in 1961. Sugar is an essential commodity with a truly global footprint. The industry is dominated by local refining of imported raw sugar to meet 97percent of the country’s sugar needs, but Nigeria has the potential to become a major sugar producer. Opportunities in sugar by-products and derivatives include biofuels, polymers, bio plastics, animal feeds, power production.
“Sugar is an important economic commodity whose production can be an important model of industrialisation and economic development. Cultivating and processing sugar cane provides livelihoods for a large number of people. The industry generates secondary economic activities in transport, equipment manufacturing, and retail. It catalyses investments in rural areas to such as roads, power, education and health infrastructure,” Bakrin.
Join BusinessDay whatsapp Channel, to stay up to date
Open In Whatsapp
