By Jeph Ajobaju, Chief Copy Editor
Cocoa, one of Nigeria’s major foreign exchange earners before oil, is still in the reckoning with N63.18 billion export sales in the second quarter of 2021 (H2 2021), followed by cashew nuts which fetched N42.94 billion.
Missing in the top 10 are groundnuts and palm oil which with cocoa formed the triumvirate that powered Nigeria’s economic growth up to the 1960s. Groundnut oil in now imported from Turkey and palm oil from Malaysia, among other countries.
Nigeria exported agric-food items worth N165.27 billion in H2 2021, a 112 per cent increase against N78.03 billion in H2 2020, and the highest on record, according to National Bureau of Statistics (NBS) data.
The latest figure is 30 per cent above N127.18 billion in Q1 2021.
Nairametrics had earlier reported that foreign trade rose 89 per cent year-on-year (YoY) to N12.03 trillion in Q2 2021, but noted a trade deficit of N1.87 trillion as N6.95 trillion imports were greater than N5.08 trillion exports.
Agricultural imports also increased 56.9 per cent YoY in Q2 2021 to N652.08 billion, a huge deficit of N486.8 billion in a country blessed with a vast land and an agric sector that employs a huge chunk of the country’s workforce.
However, Nigeria continues to expand its ability to earn foreign exchange (forex) from agricultural export, especially as oil revenue has been slashed by OPEC production quota and unstable crude prices.
Local food production is not enough for domestic consumption, hence the need to import from other countries, which in turn affects the balance of trade and by extension the exchange rate.
Last month, Sterling Bank board of directors Chairman Asue Ighodalo said at the bank’s fourth Agriculture Summit Africa (ASA) that Nigeria’s current 1.3 per cent agricultural output does not meet food and raw material demands, per Nairametrics.
N486.8b agric trade deficit
Nigeria has had continuous agric trade deficit in the past five and a half years; the highest was N503 billion in Q1 2021 followed by N486.8 billion in Q2 2021.
Gross Domestic Product (GDP) data shows that agriculture has grown consistently positively in recent years, reaching 1.3 per cent in Q2 2021. The sector is valued at N16.67 trillion in real terms, about 23.5 per cent of the economy.
Below are the cream of agricultural exports gleaned from NBS data published by Nairametrics:
Top 10 agric exports
- Cocoa – N63.18 billion
- Cashew nuts – N42.94 billion
- Sesamum seeds – N21.64 billion
- Coconut – N13.02 billion
- Ginger – N3.75 billion
- Frozen sea foods – N3.46 billion
- Brasil nuts in shell – N3.28 billion
- Natural cocoa butter – N2.44 billion
- Sesame oil and its fraction – N1.29 billion
- Palm nuts and kernels – N1.08 billion
Agric export growth boosts hard currency earnings which help shore up foreign reserves as well as relieve pressure on naira exchange rate.
Continuous negative trade balance puts pressure on the treasury to search for scarce forex to import items, even those that could have been produced locally.