In 2023, the production of palm oil in Nigeria reached 1.4 million metric tons. Between 2009 and 2023, the production quantity generally increased, registering the highest growth in 2010, when it grew by roughly 14 percent. From 2014 onwards, the output from palm oil production followed a rising trend. Nigeria is one of the leading producers of palm oil worldwide.
Annual demand for palm oil in Nigeria currently stands at 3 million metric tons, while annual production remains low at 1.4 million metric tons. This is because Nigeria currently spends 500 billion annually on imports to fill the deficit in production.
The country’s palm oil import from Malaysia increased to 234,324 metric tons (MT) between January-September 2023, from 141, 786 MT in the corresponding period of 2022. This indicated a 92,538 MT increase.
Edo State new investment in oil palm production will enhance the growth, provide solution and development of the sector. What we need is to make a new habit of investing in oil palm production in Nigeria. It is a very lucrative business. “We should also invest more in the local processing of oil palm. Within the space of four to five years, an investment in oil palm would have begun yielding returns; therefore, we need to go back to the basics. Edo new palm oil investment will reduce the volume of palm oil import in Nigeria.
Edo State is investing in palm oil. The Governor of Edo State, Godwin Obaseki has allocated lands for large-scale commercial farming in multiples of 5,000 and 10,000 hectares to both indigenous and foreign agro-investors like Agro-allied Resources and Processing Nigeria Limited (Dufil), AgriPalm Ltd, a subsidiary of Flour Mills Nigeria Plc, Saro Oil Palm, Bragav Nigeria Limited, Saturn Farms among others. These investors are currently at different stages of development at their respective lands.
70,000 hectares allocated under Edo oil palm programme in 4yrs. The Edo State Government of Nigeria has set out 100,000 hectares (ha) of land for oil palm cultivation by investors. The Governor of Edo State has allocated lands for large-scale commercial farming in multiples of 5,000 and 10,000 hectares to both indigenous and foreign agro-investors like Agro-allied Resources and Processing Nigeria Limited (Dufil), AgriPalm Ltd, a subsidiary of Flour Mills Nigeria Plc, Saro Oil Palm, Bragav Nigeria Limited, Saturn Farms among others. These investors are currently at different stages of development at their respective lands.
Governor Obaseki says the state has created its own programmes which are able to tap into financing initiatives that the federal government and Central Bank make available. This includes a $500m fund of low interest loans made available to Nigerian producers. The Edo State Oil Palm Production (ESOPP) programme is the vehicle through which public-private partnerships and investment happens.
Capacity and institution building are also critical to success, he says. The state has been working with international partners and organisations. Edo state is a signatory of the Marrakech Declaration for the Sustainable Development of the Palm Oil Sector in Africa – initiated at Cop22 in 2016 – and a member of the Africa Palm Oil Initiative, along with nine West and Central African countries.
But the most important factor in bringing palm oil back to Nigeria is a coordinated approach and a cohesive strategy, he explains
Edo state is carrying out palm oil research and development programmes, along with education and training initiatives, are being rolled out to promote better farming techniques and improve the quality of seeds. Such steps can help to boost productivity, cut down on palm oil imports and attract investment.
According to a report, Nigeria’s palm oil imports in the past six years stood as follows: 2017, N21.2billion; 2018, N32.2 billion; 2019, N19billion; 2020, N22billion; 2021, N134.7billiion; and 2022, N70.2 billion. This translates to N299.6billion.
A barrel of palm oil sells for $600 at the international market. Nigeria gets most of its supply of palm oil from Malaysia, India, China and Cameroon. According to the National Bureau of Statistics (NBS), palm oil ranks among the top five agricultural products imported into the country in spite of the fact that it was one of the items excluded from forex list in June 2015.
The present Edo palm oil programme has the capacity to stop palm oil import in Nigeria. Nigeria imports over $500 million worth of palm oil yearly which Edo palm oil programme will eliminate in the next five years. Edo Palm Oil programme will soon stop the importation of palm oil in Nigeria. Governor Obaseki has changed the narrative on investment in palm oil plantations in Nigeria and he has attracted millions of dollars worth of investments into palm oil development. Central Bank of Nigeria is also involved.
A barrel of palm oil sells for over $600. Nigeria’s Palm Oil imports from Malaysia – a top global producer have surged by 353 percent in the first four months of 2023 despite local players ramping up production, data from the Malaysian Palm Oil Council shows. The country’s palm oil import from Malaysia increased to 92,961 metric tons (MT) between January-April 2023, from 20,513 MT in the corresponding period of 2022. This indicated a 72,448 MT increase.
In 2022, the country imported 227,035 MT of palm oil from Malaysia. Despite moves by the government, in listing crude palm oil alongside other 40 items restricted from forex access, and closing the Nigerian borders, oil palm imports into the country are still on the rise owing to the huge demand-supply gap, according to experts.
Nigeria’s oil palm imports from Malaysia will continue to increase for the time being because our investment in the industry is still very insignificant,” Henry Olatujoye, managing director, Palmtrade and Commodities Development Nigeria Ltd, said. I estimated that our local/domestic consumption is averaging 2.4 million tons in a year, and our first-class developers – Okomu, Presco, and others, do not annually produce up to 800,000 tons.
According to the United States Department of Agriculture (USDA), the production of palm oil in Nigeria reached 1.4 million metric tonnes (MT) in 2022, a 9 percent uptick from 2020/21 when production stood at 1.28 million MT.
Despite featuring prominently on a June 2015 list of import item not valid for forex by the Central Bank of Nigeria (CBN), Nigeria imported at least N299.6bn of palm oil from 2017 to 2022, an analysis of Nigeria’s Foreign Trade has revealed. The reports, which are released quarterly by the National Bureau of Statistics (NBS) indicate that the product itemed ‘Palm Crude Oil’ is often among the top five imported agricultural products into the country. The oil palm tree produces high-quality oil used primarily for cooking in developing countries. It is also used in food products, detergents, cosmetics and, to a small extent, biofuel.
According to the former governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, Nigeria imported 302,000 metric tons in 2017 despite placing the product in the forex exclusion list.
Oil palm has been the mainstay of the state economy long before crude oil was discovered. This bill will regulate oil palm production activities in the state. ”It is a billion-dollar industry that has the potential to boost the revenue of the state, Edo remains one of the leading states in oil palm cultivation and production in the country.
Donald writes via [email protected]
