…Okomu, Presco earn over $18m in exports, exchange gain
Palm oil has failed to feature prominently in the list of Nigeria’s top non-oil exports, but experts say it has the potential to gross $10 billion for Africa’s most populous nation.
Nigeria earned $5.456 billion from all non-oil export products in 2024, representing a 20.8 percent rise from the $4.52 billion recorded in 2023, according to the Nigerian Export Promotion Council (NEPC).
Cocoa beans and urea/fertilizer emerged as top earners, constituting 46.29 percent of the total non-oil exports.
Incidentally, palm oil was not among the top 20 export products.
Read also: Nigeria’s largest palm oil maker to raise record N100bn bond
In 2024, palm oil only featured in the top 20 in the third quarter (Q3), grossing N4.608 billion in naira terms from exports.
But things changed in the nine-month to September 2024, with Okomu Oil and Presco earning N11.52 billion in exchange gain.
Okomu Oil’s exchange gain rose to N8.23 billion in the nine months of 2024 from N109.3 million in the same period of 2023. Presco’s exchange gain stood at N3.29 billion from N3.89 billion.
In total export earnings, Okomu earned N15.95 billion ($10.63 million) while Presco earned nothing.
There is yet no data on how much Nigeria grossed from palm oil exports in 2024, but experts say it is less than $20 million.
Indonesia, Malaysia and other peers
Malaysian exports of palm oil and related products totalled $22 billion between January and November 2024, Oil and Fats International said. Indonesia earned $22.67 billion from palm oil.
Nigeria produces over one million metric tonnes (MT) of palm oil per annum, with local consumption estimated at 2.7 million MT and demand-supply gap put at 1.7 million metric tonnes yearly. Nigeria’s exports constituted 45 percent of the palm oil market in the 1960s but it is now 1.5 percent, experts say.
“We can earn as much as N8 billion to N10 billion from exporting palm oil. All we need to do is to get the right seeds and fund the crop from planting to marketing,” said Ike Ibeabuchi, an emerging markets analyst.
“But we are not paying enough attention to this crop. We are not investing enough in the sector. What you find are old trees and aging farmers.”
Experts suggest that building processing mills close to farms, financing smallholder farmers, using cutting-edge technology during processing and having easy access to markets are key to unlocking the $10 billion palm oil export potential in 2025.
Profitable venture
Beyond production, palm oil exports can be a highly profitable venture for investors and stakeholders, but many people are unfamiliar with the processes, organisation and documentation needed to successfully export agricultural products, particularly cash crops.
The palm oil industry witnessed a strong financial comeback in 2024. This was fuelled by rising global demand and strategic adaptations according to reports.
As a cost-effective and versatile vegetable oil, palm oil makes up about 35 percent of global vegetable oil production, with its market value reaching $55 billion.
The industry’s growth is driven by its wide use in food, cosmetics, biofuels, and pharmaceuticals. Analysts predict a 6 percent annual growth rate through 2030, indicating continued demand for affordable and scalable resources.
Akingbala Aetokumbo, managing principal consultant at Postervillan, highlighted that Nigeria, once the world’s leading exporter of palm oil, is now grappling with an annual supply deficit of $450 million.
Read also: OOP acquires 4 high tech mills to boost palm oil production
High imports
The National Palm Produce Association of Nigeria (NPPAN) said Nigeria spends $600 million on palm oil importation annually.
Alphonsus Inyang, national president of the association, stated this in an interview with NAN recently in Abuja, describing the expenses as unhealthy for national development.
Inyang said the money could be saved and injected into the economy if the palm oil sub-sector would be given due attention by governments at all levels.
“At the moment, the country occupies the fifth position in the league of palm oil-producing countries after Indonesia, Malaysia, Thailand and Colombia.
“Nigeria may even lose the position to smaller countries who are investing heavily in the sector.”
