Import waivers meant to ease hunger and insecurity on farms have led to a deficit, ending a two-year run of surpluses, as Nigeria’s agricultural trade balance swung from a N740.27bn surplus in the first half of 2025 to a N56.13bn deficit in H1 2026, according to agriculture and trade experts.
Recent foreign trade data from the National Bureau of Statistics showed that agricultural exports fell by 33.28 per cent, or N985.14bn, to N1.98tn in H1 2026 from N2.96tn in H1 2025.
Agricultural imports fell by only 8.50 per cent, or N188.74bn, to N2.03tn from N2.22tn over the same period. The gap between the two movements produced a N796.40bn swing in the trade balance.
Nigeria recorded a N365.74bn deficit in H1 2023, when imports of N926.25bn far exceeded exports of N560.51bn. The balance then turned to a N194.92bn surplus in H1 2024 before it widened to N740.27bn in H1 2025.
In separate phone interviews with The PUNCH, Agribusiness experts, including the Chairman of the Lagos Chamber of Commerce and Industry’s Agricultural and Allied Group, Tunde Banjoko, explained that recent government policy led to the shift.
Banjoko said, “Some waivers were given for products like palm oil and rice, and the import tariffs were drastically reduced. It became more favourable for people to import than to patronise local producers.”
He said the waivers on food commodities hurt domestic producers, even though lower tariffs on tractors and manufacturing equipment helped them.
According to Banjoko, “The effect is that our imports will rise above our exports. Second, we will discourage local production. Thirdly, we will be reducing employment, because some factories will shut down if they are not able to compete.”
Banjoko also said weak funding for processors compounds the problem. He said foreign direct investment flows mainly into the capital market rather than into production and processing, so local processors cannot scale.
He urged the Federal Government to speed up the Special Agro-Industrial Processing Zones programme. “We should speed up such projects where we can produce enough for our country and start exporting, not look for shortcuts by reducing prices,” Banjoko added.
Meanwhile, the Chief Executive Officer of the Centre for the Promotion of Private Enterprise, Dr Muda Yusuf, identified two major factors behind the deficit. He said the first was the Federal Government’s decision to allow some food imports to tackle runaway inflation.
Yusuf said, “The first is the decision of the government to allow for some food imports as a result of the challenges of food inflation, which at a point was getting almost completely out of hand.”
He added that insecurity worsened the supply gap and cut export capacity, stating, “Insecurity led many farmers to leave their farms. Many of them have ended up in IDP camps, and quite a number have completely abandoned farming.”
He added that farmers cannot export without output. Yusuf said, “You can only export when you have the output.”
Yusuf also said high input costs and falling produce prices have discouraged farming. He said, “Most of these inputs are imported, so the exchange rate situation has seriously affected the cost of inputs, and the prices of produce have gone down.”
He urged the Federal Government to cut the cost of fertiliser, agrochemicals, machinery and improved seedlings. He also called for a minimum guaranteed price for agricultural produce.
Yusuf said, “The government can establish a threshold below which, if prices fall, it will give farmers some compensation. That is the way it is done in many other economies.”
Source: punchng.com
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