Importing Agrifoood into Nigeria

Nigeria’s Policy on Agriculture and Import Substitution

Nigeria relies on imports to meet its food and agricultural product needs, mostly wheat, rice, poultry, fish, food services, consumer-oriented foods, and so on, worth about €8.5 billion annually, which are mostly sourced from Europe, Asia, the United States, South America, and South Africa. To reduce the deficit, enhance the Nigerian government has focused its policies on local trade, and boost of exports. the Government of Nigeria has introduced different policies and programs, such as the Agriculture Promotion Policy3, Nigeria-Africa Trade and Investment Promotion Programme (NATIPP), Presidential Economic Diversification Initiative (PEDI), Zero Reject Initiative, Economic and Export Promotion Incentives, Anchor Borrowers Program (ABP), Green Imperative, among others to support its agenda.

According to the National Bureau of Statistics, in 2019, Nigeria spent about €46.22 billion on imported food items alone. To protect local producers, as well as stimulate the growth of the agricultural industry in Nigeria, the government placed trade barriers on certain agricultural products and also offered some economic incentives like zero import duty on agricultural equipment, income tax relief, and VAT exemptions to investors in the industry. Despite the restrictions, the demand for imported products continue to increase sporadically which can be attributed to several reasons mentions in the main document linked to this summary 

Nigeria Food Import Economy

The main driver of Nigeria’s agricultural goods imports in 2020 was wheat, just as recorded in the other years. During the third quarter of 2020, total trade in Agricultural goods stood at €1.14 billion, out of which imported agricultural goods accounted for €1.02 billion. The breakdown of the imports shows that durum wheat worth €122.1 million was imported from the United States, €102.5 million value from Russia, and €102.3 million value from Canada. This was followed by Mackerel, imported from Russia worth €30.36 million, Netherlands (€12.76 million), and Japan (€5.72 million). Maize seed worth €56.98 million was also imported from Argentina.

As of the end of the third quarter in 2020, the National Bureau of Statistics (hereafter, NBS) stated that the top five major import trading partners of Nigeria by country are China (30.51%), the United States of America (8.96%), Netherlands (8.24%), India (6.58%) and Belgium (3.95%), while by the continent is Asia (48%), Europe (34%), America (14%), Africa (3%), and Oceania (1%). The National Bureau of Statistics’ quarterly international trade report shows that the top five agricultural products imported into Nigeria include durum wheat (not in seeds), durum wheat (seeds), mackerel, blue whitings, and herrings. Out of these top products, mackerel, blue whitings, and herrings are mostly sourced from the Netherlands. In other areas of food import adequate records are not available, thus it is hard to estimate the exact import figures of food imported into Nigeria. Nevertheless, for the quarters recorded, most imports of these products come from the Netherlands. The Netherlands is one the largest trading partners of Nigeria and has been able to sustain the relationship for several decades

Import processes in Nigeria involve several stages

Import processes in Nigeria

Organizations Active in the Importation of Agri-Food, Agricultural, and Agro-Allied Products and Services into Nigeria

There are several registered companies actively involved in the importation and distribution of imported agricultural products in Nigeria but the most recognized are the superstores located in several locations in the country. Shoprite, Spar, Grand Square, and Grocery Bazaar, among others, are some of the markets involved in this service.

Standardization of imported products

The standardization of imported goods in Nigeria involves the following process

Standardization of Imported goods

Constraints, Inefficiencies, and Degree of Alignment with World Trade Organization (WTO) and ECOWAS Trade Liberalization Scheme

Nigeria became a member of the WTO on 1 January 1995 and ratified the WTO Trade Facilitation Agreement on 20 January 2017 and the amended WTO Agreement on Trade-Related Aspects of Intellectual Property Rights 1994 (TRIPS) Agreement on 16 January 2017. Regarding the EU’s Economic Partnership Agreement which involves the gradual opening of the country's market access to the EU markets, with the EU opening up of its markets in a similar gesture. However, Nigeria has been resistant to signing the trade agreement with the European Union, as the government believes that domestic industries cannot compete with the more efficient and highly technologically driven industries in Europe.

Comparative Analysis of Nigerian Import and Export Systems with South Africa, Netherlands, Kenya, Ghana, and Cote d'Ivoire

Comparative analysis

Conclusively the Netherlands remains an important trading partner to Nigeria and might remain in the position in the foreseeable future. However, before importing agricultural materials and food into the country, a thorough strategic analysis is required to assist in examining the environment and speculating unforeseen issues. Therefore, the utilization of SWOT analysis, PESTEL analysis, Porter’s Five Forces Framework, scenario planning, and other business analysis is paramount. To expand into the Nigerian market, the Dutch government needs to gain the trust of local business partners and prospective customers to thrive.

Dutch business are advised to send executives to build personal relationships with international business partners and hire local distribution partners or independent, third-party intermediaries to represent their products or services overseas. In the light of this, the Dutch public sector representation in Nigeria  is facilitating relations with top distributors of agricultural products, like supermarkets, downstream producers, stores, and retail outlets.

Follow this link to see details on process and procedures of importing into Nigeria.  

The Netherlands Government Agricultural team in West Africa is available to assist you in Advancing you agribusiness interest in Nigeria.

Landbouwteam, Ghana, Ivoorkust en Nigeria
Twitter: @Agri_WestAfrica