Players and stages in Nigeria’s rising vegetable/oil exports

Following the move to make agriculture a business in Nigeria as against being treated as a development program, a number of investors and companies have taken up the challenge.

Particularly in the last two years, Nigeria’s non-oil exports have received a boost from the Federal Government, Federal Ministry of Agriculture and Rural Development; the Central Bank of Nigeria (CBN), Bank of Industry (BoI); the Nigerian Investment Promotion Commission (NIPC) and with support from the African Development Bank(AfDB).

How do we measure the progress recorded a few years down the line? We take a look at the export of vegetable oils and vegetables.

Between 2014 and 2015, Nigeria’s export of vegetables amounted to an average of N400 billion annually. In 2016, vegetable exports generated N413 billion foreign earnings to Nigeria. Interestingly, in just nine months in 2017, the same item has generated N426.6 billion foreign income to the nation, 3.14 percent higher than the entire export in 2016, meaning that the figure will be far higher by year end.

With regards to vegetable oils, total annual income from export of vegetable oils continue to hover around N90 billion. Both vegetables and vegetable oil exports are subjected to stringent international standards that must be met before such goods are allowed into the international markets.

Palm oil remains the most produced and consumed vegetable oil in the world accounting for 30 percent of the global oil production and consumption. It is closely followed by soybean oil, rapeseed oil and sunflower oil, and altogether, they account for 89 percent of the global vegetable oils production and consumption.

Indonesia, the European Union, Malaysia, China and Thailand use palm oil the most for industrial purposes. On the other hand, India, Indonesia, EU, China and Malaysia are the largest domestic users of palm oil. The largest industrial users of soybean oil are USA, Brazil, Argentina, EU and Bangladesh, while China, USA, Brazil, India and Argentina are the largest domestic users of soybean oil.

Flour Mills of Nigeria and PZ Cussons are among the leading exporters of vegetable, oils while Thelma Farms Limited is a force in the export of vegetables. Data were sourced from the National Bureau of Statistics (NBS), Pre-shipment inspection documents, Index Mundi, FEDOIL, CBI Ministry of Foreign Affairs, CME Group, UFOP, Food and Agriculture Organisation (FAO), USDA Foreign Agricultural Service and Hort Zone.

The success recorded so far by these firms is encouraging. Notwithstanding, more has to be done for Nigerian exporters to be dominant in the international market for these products.

Meanwhile, as consumers demand for healthier diets across the world, most of the countries of the world have become more stringent with standards. Particularly in the European Union whose members are the destinations of Nigeria’s vegetable oil and vegetables exports, the standard specifications for the different variants of vegetable oils are stated in the report alongside those of the Standards Organisation of Nigeria (SON).

As other countries increase investments in agriculture, Nigerian exporters of vegetables and vegetable oils should prepare for stiff competition from their rivals. Another area of challenge is sustainable agriculture, which is gathering momentum in the EU with the effect that operators from the different supply chains are mandated to source raw materials from agricultural production systems that are sustainable.