Nigeria’s pursuit of economic diversification and reduced reliance on oil revenue has gained momentum, with non-oil exports showing promising growth in October 2024. The Central Bank of Nigeria (CBN) highlighted this positive trend in its monthly economic report, revealing a surge in non-oil export earnings. This increase, primarily driven by higher receipts from agricultural commodities, underscores the potential of the non-oil sector to contribute significantly to the nation’s economic stability and growth. The CBN report identified Indorama Eleme Fertiliser & Chemical Ltd. and Dangote Fertiliser Ltd. as the leading non-oil exporters, contributing substantially to the overall increase in export earnings.
The dominance of these two fertilizer giants reflects the growing importance of the agricultural sector in Nigeria’s export portfolio. Indorama Eleme Fertiliser & Chemical Ltd. claimed the top spot, contributing 18.97% of total non-oil exports through urea shipments. Dangote Fertiliser Ltd. followed closely behind with an 8.72% share, exporting primarily fertilizers. This robust performance in fertilizer exports signifies the nation’s increasing capacity in agricultural input production, a crucial factor in boosting agricultural productivity and food security. The prominence of these two companies also underscores the role of private sector investment in driving the growth of the non-oil sector.
Beyond fertilizers, other key players contributed significantly to Nigeria’s non-oil export success. Outspan Nigeria Ltd. secured the third position with an 8.45% share, specializing in cocoa exports. Starlink Global & Ideal Ltd. followed with a 7.35% contribution, primarily through dairy product exports, while Olatunde International Ltd. rounded out the top five with a 5.96% share from cocoa bean exports. The diversification of non-oil exports across agricultural commodities like cocoa and dairy products, alongside manufactured goods like fertilizers, demonstrates the broadening scope of Nigeria’s export base. This diversification is crucial for mitigating risks associated with over-reliance on a single commodity and strengthening the resilience of the national economy.
The CBN report also shed light on the geographical distribution of Nigeria’s non-oil exports. Brazil emerged as the leading destination, absorbing 20.22% of Nigeria’s non-oil exports. The Netherlands followed with 15.61%, trailed by Malaysia (11.76%), Japan (6.35%), Germany (5.32%), and the USA (5.21%). This spread of export destinations indicates Nigeria’s expanding global market reach and its ability to penetrate diverse international markets. This diversification of export destinations is crucial for minimizing dependence on any single market and mitigating potential risks associated with economic or political instability in specific regions.
Analyzing the composition of non-oil exports revealed a dominance of agricultural products. Cocoa beans led the way, accounting for 30.04% of non-oil exports, followed by urea (26.59%), sesame seeds (5.64%), cocoa products (5.63%), aluminium (3.84%), and copper (3.43%). The strong performance of cocoa and its processed products underscores the potential for value addition in agricultural exports, which can significantly enhance export earnings and create more jobs within the agricultural sector. The presence of aluminium and copper among the top exports also highlights the contribution of the manufacturing and extractive industries to the non-oil export basket.
While the growth in non-oil exports paints a positive picture, the CBN report also acknowledges an increase in overall imports. Total imports rose to US$2.81 billion in October from US$2.78 billion in September, driven by both oil and non-oil imports. The industrial sector accounted for the largest share of import expenditure (56.88%), followed by food products (15.35%), the oil sector (13.50%), manufactured products (8.13%), minerals (3.14%), transport (2.58%), and agriculture (0.42%). This increase in imports, particularly in the industrial sector, could reflect ongoing investment in infrastructure and manufacturing capacity, which are essential for long-term economic growth. However, careful management of the trade balance remains crucial to prevent excessive import dependence and maintain a healthy external sector position.
