In 2024, Nigeria’s foreign trade witnessed a significant disparity in the utilization of various transportation modes. Maritime transport stood out with a substantial surplus in exports over imports, a stark contrast to the trends observed in air and road transport. The value of goods exported via sea routes reached N78.37 trillion, surpassing the N52.37 trillion worth of goods imported through the same channel, marking a significant 39.76% difference. This imbalance underscores a strategic preference among importers for faster alternatives to avoid delays associated with sea transport, a pattern also observed in the preceding year, 2023, albeit with a smaller margin. This preference for speedier options reflects the dynamic nature of global trade and the importance of efficient logistics in maintaining competitive advantage.
While maritime transport showcased an export surplus, the overall trade balance for Nigeria in 2024 painted a more nuanced picture. Total exports reached N79.11 trillion, exceeding total imports valued at N58.31 trillion, resulting in a positive trade balance of N20.8 trillion. However, a deeper analysis reveals that air and road transport favored imports over exports. Air cargo imports significantly outpaced exports, reaching N3.68 trillion against a mere N321.6 billion in exports, a staggering 167.85% difference. Similarly, road transport witnessed a 70.20% dominance of imports, with N273.71 billion in imports compared to N131.48 billion in exports. These contrasting trends highlight the influence of factors such as product type, urgency of delivery, and cost considerations on the choice of transport mode.
The rationale behind the observed discrepancies in transport mode utilization becomes clearer when considering the perspectives of industry stakeholders. Kingsley Chikezie, president of the Importers Association of Nigeria (IMAN), sheds light on the trade-offs involved in selecting different transport modes. He emphasizes the time sensitivity of certain goods and the impact of transport time on business turnover. While maritime transport offers cost advantages, particularly for bulk and heavy cargo, it suffers from significantly longer transit times, often ranging from 90 to 120 days. This extended duration negatively affects inventory turnover and ties up capital for longer periods. Consequently, businesses dealing in time-sensitive products, like textiles and pharmaceuticals, gravitate towards air cargo despite the higher costs.
Air transport offers a significantly faster turnaround time, often delivering goods within a week, enabling businesses to replenish stock and complete multiple trade cycles within a month. This accelerated turnover translates to higher profitability and improved responsiveness to market demands. Importers can react quickly to changing trends and consumer preferences, minimizing the risk of holding onto unsold inventory. Chikezie’s illustration of ordering goods from China with a Saturday delivery deadline underscores the critical role of air cargo in meeting tight deadlines. The speed and reliability of air transport are essential for businesses operating in fast-paced industries where time is a crucial competitive factor.
However, the higher costs associated with air cargo restrict its feasibility for certain product categories. Heavy goods, such as building materials, cement, tiles, and plumbing supplies, are more economically transported via sea routes due to weight and volume considerations. The cost differential between air and maritime transport for such goods becomes substantial, making sea freight the more practical option. This cost-effectiveness of maritime transport for bulk commodities explains its continued dominance in this segment of international trade. The choice between air and sea transport, therefore, becomes a strategic decision balancing speed and cost, tailored to the specific characteristics of the goods being traded.
The dynamics of international trade are further influenced by the role of specialized logistics companies. DHL, as highlighted by Chikezie, plays a crucial role in facilitating air cargo operations. With a network of dedicated cargo planes and daily deliveries from global locations, DHL and similar companies contribute to the efficiency and reliability of air transport. Their ability to handle diverse consignments and ensure timely deliveries makes them indispensable partners for businesses relying on air cargo. This integrated logistical support streamlines the process, minimizing the complexities of international shipping and enabling businesses to focus on their core operations. The interplay between transport modes and specialized logistics providers shapes the landscape of global trade, offering businesses a range of options to optimize their supply chains and achieve their strategic objectives.
