CBN: Nigeria Requires N60bn Annually to Meet Local Demand for Palm Oil

•Disburses N45.3 billion to boost production

James Emejo

The Central Bank of Nigeria (CBN) yesterday said the country needed about N60 billion annually for the importation of palm oil to meet domestic consumption.

The bank also stated that to date, a total sum of over N45.03 billion had been disbursed to stakeholders in the oil palm industry to aid the cultivation of about 31, 442 hectares to further grow the commodity.

CBN Governor, Mr. Godwin Emefiele, in a document obtained by THISDAY, said the apex bank’s intervention would help unleash the potential of the oil palm value chain with accompanying support for the economic diversification plan as well as the industrialisation aspiration of the country.

The importation demand was expected to cover both the Technical Palm Oil (TPO) used in industry and Special Palm Oil (SPO) used by households.

According to the apex bank, the country’s palm oil production per annum is currently estimated at 1,250,000 million metric tons (MT) with demand valued at 2,500,00 MT per annum.

According to the CBN, for the country to achieve 50 per cent import substitution through production upgrade within the next 10 years, there was need to bridge demand deficits for domestic production of fresh fruit bunches from 8.5 million MT in 2010 to about 10 million MT.

According to the fourth quarter 2021 trade statistics by the National Bureau of Statistics (NBS), crude palm oil imports from China totaled N20.28 billion and N16.49 billion from Malaysia as well as palm olein worth N31.43 billion imported from Malaysia.

The ABP was launched in 2015 to curtail excessive imports particularly palm oil and other food products that could be competitively grown in the country.

Emefiele, said recently that the achievements so far recorded in the implementation of the ABP had started to record giant strides in the production of maize and cassava and expressed optimism that in the next 12 months, palm produce harvests would have commenced in the country.

The CBN governor, who stressed that agriculture remained a strong pillar for Nigerian economy, had expressed satisfaction over the level of interest shown in agriculture and the tremendous impacts that the sector had recorded in the last six years.

Emefiele, like several other Nigerians, had particularly wondered how the country would have coped with the rising prices of food and commodity items across the world – without the foresight to revamp agriculture.

The apex bank boss further disclosed that the ultimate objective of the CBN intervention in the oil palm sector was to overtake Thailand and Colombia to become the third-largest producer over the next few years through increased oil palm production by 2028.

He said, “Core objectives of the intervention include, to meet local demand for palm oil and improve local processing quality and standards; conserve foreign exchange; create jobs and enhance the skills of Nigerian people along the oil palm value chain.”

Other objectives of the funding support to the sector is to facilitate easier access to funding for oil majors, SMEs and smallholder farmers as well as improve and grow the economy.