The Nigerian shea butter industry stands at a critical juncture, poised for transformative growth or significant setback, following the Federal Government’s recent imposition of a temporary ban on the exportation of raw shea nuts. While lauded as a strategic move to stimulate local processing, curb smuggling, and revitalize rural economies, the abrupt implementation of the ban has sparked concerns about potential massive wastage and financial losses for stakeholders, particularly aggregators left with substantial unshipped stocks. The National Association of Shea Products of Nigeria (NASPAN) has called for a carefully managed transition to mitigate these risks and maximize the policy’s intended benefits.
The crux of the issue lies in the suddenness of the ban, announced on August 26, 2025. While NASPAN President, Mohammed Kontagora, acknowledges the long-term advantages of prioritizing local value addition and job creation, he stresses the disruptive impact on existing trade agreements. Aggregators, caught off guard by the policy shift, now face the prospect of significant financial losses due to the inability to fulfill pre-existing export contracts worth billions of naira. This stockpile of raw shea nuts, representing considerable investment and resources, is now in jeopardy, highlighting the need for a more measured approach to policy implementation. NASPAN’s request for a 90-day grace period for existing contracts underscores the urgency of addressing this challenge to prevent widespread economic hardship within the industry.
The ban, aimed at harnessing the immense potential of Nigeria’s shea resources, comes at a crucial time. Nigeria holds a dominant position in the global shea market, accounting for nearly 58% of the world’s shea trees. This abundance presents a unique opportunity to establish the country as a global leader in shea processing and production, moving beyond the export of raw materials and capturing a larger share of the value chain. The projected revenue generation of $300 million annually in the short term underscores the significant economic benefits that could accrue from a successful transition to local processing. However, realizing this potential hinges on effectively addressing the immediate challenges posed by the ban and implementing supportive measures to facilitate the growth of the domestic processing sector.
NASPAN has put forth a comprehensive set of proposals designed to ensure the successful implementation of the ban and foster the sustainable development of the shea industry. Central to their recommendations is the establishment of a Shea Marketing Board, tasked with regulating pricing and providing crucial support to local processors. This regulatory body would play a vital role in stabilizing the market, ensuring fair pricing for both producers and processors, and promoting transparency within the industry. Furthermore, NASPAN advocates for the provision of grants to bolster domestic processing capacity, recognizing the need for investment in infrastructure and technology to facilitate the shift towards value-added production.
Beyond these immediate measures, NASPAN emphasizes the importance of establishing a robust legal and regulatory framework for the shea industry. The passage of the National Council on Shea Bill is seen as a critical step in providing the necessary structure and oversight for sustainable growth and development. This legislation would formalize the industry’s operations, promote best practices, and ensure adherence to quality standards. Simultaneously, strengthening border policing is crucial to curbing smuggling, protecting local industries from unfair competition, and maximizing the benefits of the export ban. This multifaceted approach, combining regulatory frameworks with enforcement mechanisms, is essential for creating a level playing field and fostering a conducive environment for domestic processors to thrive.
Finally, recognizing the interconnectedness of economic development and environmental sustainability, NASPAN advocates for the integration of shea into climate management programs. This forward-thinking approach aims to promote sustainable harvesting practices, preserve biodiversity, and ensure the long-term viability of the shea resource. By linking economic development with environmental conservation, Nigeria can establish a model for sustainable resource management, ensuring the continued prosperity of the shea industry for generations to come. The successful implementation of these proposals requires a collaborative effort between the government, industry stakeholders, and local communities, working together to unlock the full potential of Nigeria’s shea resources while safeguarding the environment.
