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Nigeria Spends $3.2bn On Importation Of Palm Oil In 10yrs


Nigeria has imported palm oil worth over $3.2billion in the last ten years, LEADERSHIP can authoritatively report.

Findings by LEADERSHIP revealed that the nation imported a cumulative 4,760,000 tonnes of palm oil from 2007 to November, 2017.

Palm oil, hitherto one of the nation’s major foreign exchange earners in the early 1960s is massively imported into the country from Malaysia and Indonesia.

Recall that Nigeria was the largest producer of palm oil in the world with a market share of 43 per cent in the 1960s. But currently, it has a world share of 2.9 per cent, with Indonesia leading by 33 million metric tonnes, Malaysia, 19.8 million metric tonnes; Thailand, two million; Colombia, 1.108 million metric tons and Nigeria, 970,000 metric tonnes.

Palm oil that used to be Nigeria’s biggest export produce before the discovery of crude oil has now been adopted by Asian countries earning over $25.2 billion in exports.

With domestic production currently standing at 970,000 metric tonnes in Nigeria, the country needs an annual 2.7 million tonnes leaving a deficit of 1.73 million tonnes. It was further gathered that despite the high exchange rate and price, the shipment was increased by 12 per cent as global price hit $718 per metric ton.

The price of the commodity, which was $663 per metric ton in July, rose to $718 per ton this November based on high demand by indigenous manufacturers.

According to statistics exclusively obtained by LEADERSHIP, Nigeria now import between 400,000 to 500,000 Metric Tonnes of palm oil from Asia to bridge domestic production. With the country importing 4.7milllion MT at $663 per MT between 2007 to 2017, the country had spent a whopping $3.2 billion importing what can be locally produced.

The breakdown shows that in 2007, Nigeria imported 451,000MT of palm oil while 410,000MT was imported in 2008; 425,000MT in 2009; 435,000MT in 2010; 440,000MT in 2011.

Also, in 2012, Nigeria imported a whopping 470,000MT of palm oil while 518,000MT was imported in 2013; 506,000MT in 2014; 263,000MT in 2015; 400,000MT in 2016 and as at November 2017, 450,000MT of palm oil imported into the country.

Records from the Nigerian Ports Authority (NPA) also revealed that MASCOT Munchen, is expected to deliver 8112.17 MT of Crude palm oil at Josepdam Terminal on Tuesday. Also, Apapa Bulk Terminal Limited (ABTL) at Lagos Port Complex took delivery of 4,000 tonnes from MV Lady Dahlia, bulk carrier, in the first week of this month, while MV Hamour Endurance is awaiting to discharge about 5,000 tonnes at JosepDam terminal, Tin Can Island Port.

In August this year, three vessels berthed at the Lagos Port Complex and Tin Can with 32,483 tonnes of the commodity. At ABTL were MV GSW Forward and MV Marios G ships, laden with 16,300 tonnes and 11,483 tonnes respectively. Another ship, MV Theresa Success, investigation showed, has also offloaded 5, 000 tonnes of the product at JosepDam terminal.

Findings also revealed that between January and April this year, 50,010 tonnes of the commodity was shipped to the country. According to investigation at the Lagos Port, MV SeaPrice discharged 15,000 tonnes in January; MV Chemtrans Havel, 10,700 tonnes in February; MV Star Ploeg, 16,400 tonnes in March and MV Mid Nature, 8,000 tonnes in April this year.

Following the high demand for palm oil by Nigeria and Ghana this year, a shipping line, CMA CGM in August, imposed a new cargo protection service for shipments of the commodity into the country.

http://leadership.ng/2017/12/07/nigeria ... oil-10yrs/

Nigeria’s palm oil import: How NIFOR failed on its mandate

The formal mandate of the Nigerian Institute for Oil Palm Research is to conduct research into the production and products of oil palm and other palms of economic importance and transfer its research findings to farmers. Nigeria has imported palm oil worth over $3.2billion in the last ten years. The greatest challenge in Nigeria is that NIFOR has totally disconnected from potentially small-scale and out-grower smallholder farmers of palm oil plantation and failed in its mandate. Today, NIFOR has failed in its mandate for allowing Nigeria to fall from being the largest producer of oil palm to net importer of palm oil. NIFOR failed in its mandate because there is no policy statement on how Nigeria can return back as the largest producer of palm oil in the world and the institute is always waiting for its annual subvention from Abuja. It lacks innovation. There is need to review the operations of NIFOR in the last fifty years and reposition it to deliver on its mandate. Today, the institute has no record on how many private individuals or organizations that have established palm oil plantations in the last 20years in Nigeria. NIFOR is located in Benin City and he does not even know the number of palm oil estates in Edo State. Rather there is always struggle for managerial positions in the institute. How can the institute deliver on its mandate when it has no records or database of palm oil estates in Nigeria? Federal Government should as a matter of urgency review the operations of NIFOR.

NIFOR has failed in its mandate for allowing Nigeria to produce only 1.7 per cent of the world’s consumption of palm oil which is insufficient to meet its domestic consumption which stands at 2.7 per cent. Thus, the question of net exports doesn’t arise; however, paradoxically, about 20.0 per cent of the oil palm produced domestically is considered of high quality and clears all the seventeen tests for being an exportable commodity.

Prior to the establishment of the Nigerian Institute for Oil Palm Research, some research on the husbandry of the crop had been undertaken by the then Colonial Department of Agriculture in Nigeria. NIFOR has failed in its mandate for not repositioning Nigeria as a major producer of oil palm through the development of high yielding and locally adaptable planting materials and promotion of technologies to enhance small holders contribution to Nigeria’s pool of high quality oil palm. The news that Nigeria imported more than N116 billion of palm oil in the last three quarters of 2017 is worrisome and failure of NIFOR. Some newspapers reported that Nigeria imported 450,000 tons of crude palm oil valued at N116.3 billion ($323.1 million) in the first 10 months of this year. The amount imported increased by 12 percent from July because of rising demand, thus pushing up the price from $663 per metric ton in July to $718 per ton as at November 2017.

For decades, palm oil industry, supported by the Nigerian Federal Government, has been struggling to expand its capacity. In the 1960s, the government started to heavily promote large-scale plantations and mass production. Smallholders were geographically dispersed but kept supplying nearly 90% of the yield. The government’s attempts got constantly denounced by civil society organizations for weak governance and high corruption that mostly resulted in failures both for the industry and the country’s rich biodiversity. These attempts include the 1960’s Cross River State project and1990’s EU-funded Oil Palm Belt project. In the end, both projects had to come to a halt due to strong local opposition despite considerable EU- and World Bank support.

NIFOR has failed in its mandate for allowing thugs from local communities armed with dangerous weapons to have invaded the Nigerian Institute for Oil Palm Research (NIFOR), Edo State, sacking the Executive Director, before taking over his office. The thugs were alleged to have been led by a former top shot of the institute. It was noted that after retirement, the former executive director and some influential persons in the state went to the Federal Ministry of Agriculture and Rural Development where they got a letter reappointing him as Director/Chief Executive, a position which is not known to the Act establishing the institute. Host communities have almost taken over the management of NIFOR.

Without NIFOR, palm oil was among the first commodities of international trade, after the slave trade, between Nigeria and Europe. The world trade in palm oil at the turn of the 20th century and up to the Second World War, was dominated by countries of British West Africa (largely Nigeria), the Belgian Congo (later Zaire and now the Democratic Republic of Congo), and the Far-East Asia notably the Netherlands East Indies, (Sumatra and Java) now Indonesia

By 1950, it was realized that the work of the research station should be placed on a West African basis. Consequently after many discussions with all concerned, it was decided that a semi-autonomous institute be created as other similar organizations which had been set up to conduct research for the benefit of all the British territories in West Africa under the West African Research Organization (WARO). Thus the OPRS was taken over by WARO, by Ordinance No. 20 of 1951. Its scope of activities then extended to the then Gold Coast (now Ghana) and Sierra Leone.

NIFOR has however, since 1992 came under the aegis of the Federal Ministry of Agriculture. The thrust of work at NIFOR today, as in the past, derives from national goals as currently defined by the national policy on agriculture and the needs of farmers. Findings revealed that the nation imported a cumulative 4,760,000 tonnes of palm oil from 2007 to November, 2017. Palm oil, hitherto one of the nation’s major foreign exchange earners in the early 1960s is massively imported into the country from Malaysia and Indonesia. Recall that Nigeria was the largest producer of palm oil in the world with a market share of 43 per cent in the 1960s. But currently, it has a world share of 2.9 per cent, with Indonesia leading by 33 million metric tonnes, Malaysia, 19.8 million metric tonnes; Thailand, two million; Colombia, 1.108 million metric tons and Nigeria, 970,000 metric tonnes.

The Institute failed because it is presently managing only two oil palm estates namely the Federal Oil Palm Estate Obotme (525ha) and the Federal Oil Palm Project, Erei (720ha) on behalf of the Federal Government of Nigeria when many other palm oil estates have been taken over by forest. The Institute also runs advisory services relating to palms management, analytical services and quality assurance and diagnostic services to the palms industry in Nigeria. In this respect most of the fertilizer recommendations and policies of some major oil palm companies in Nigeria are based on the yearly routine soil and foliar analysis carried out for them by the Institutes consultancy service.

That Nigeria, just this year alone, has imported 450,000 tons of palm oil to the tune of N116.3billion, is as grim a reality as it is worrisome and failure of NIFOR to deliver on its mandate. With an ever increasing population, a steady decline in palm oil production, and a proliferation of the uses of various products from palm oil, it is an economic fact that there is high demand for palm oil in Nigeria. Therefore, it is a tragedy that Africa’s greatest potential is spending so much money on the importation of what it can produce.

INWALOMHE DONALD

https://www.businessdayonline.com/niger ... d-mandate/