Harnessing Nigeria’s Commodity Trading Potential to Combat Unemployment, Generate Foreign Exchange

Fadekemi Ajakaiye

Nigeria’s agricultural sector, once the backbone of its economy before the oil boom, remains a vital contributor to job creation and foreign exchange earnings. Historically, agricultural exports, particularly cocoa, provided substantial employment and economic benefits. During its peak in the 1960s, Nigeria was among the world’s leading cocoa producers, significantly contributing to the country’s GDP and export earnings.

Despite the dominance of the oil industry, agriculture continues to play a crucial role in Nigeria’s economy. The sector’s vast resources present a significant opportunity to boost exports, reduce unemployment, and increase foreign exchange inflows. Among the profitable commodities is cashew nuts, with Nigeria already a major producer and exporter. In 2023, cashew nut exports reached billions of naira, showcasing the industry’s potential to combat unemployment.

According to data from the National Bureau of Statistics, Nigeria’s agricultural exports surged by 48% in 2023, reaching N1.24 trillion. This growth was driven by strong demand for commodities such as cocoa, sesame seeds, soybeans, and cashew nuts. Leveraging this export potential can significantly impact Nigeria’s economy.

One company that has successfully leveraged the export potential of cashew nuts is Witford Nigeria Limited. “Through strategic partnerships with two major Asian companies, we have been able to export over 10,000 metric tons of cashew nuts, generating significant foreign exchange earnings and creating jobs,” said Tobiloba Olagbende, CEO of Witford Nigeria Limited.

The labor-intensive nature of cashew production and processing offers substantial job creation opportunities, particularly for Nigeria’s large youth population. The establishment of a modern cashew processing plant by Julius Berger in Epe, Lagos State, marks a positive development for the industry. However, to fully realize the job creation potential, investment in various areas is essential. Improved farming techniques, access to high-yielding seedlings, and better infrastructure can boost output.

“Although Nigeria is the fourth-largest producer of cashew nuts globally, there is room for growth through improved farming techniques and better infrastructure,” Olagbende noted. “Empowering smallholder farmers and investing in modern processing facilities are also crucial for adding value and creating more jobs.”

Dr. Adebayo Samuel, an agricultural economist, emphasized the need for value addition in the cashew industry. “Nigeria exports most of its raw cashew nuts, missing out on the opportunity to add value and create more jobs. By investing in processing facilities and training workers, Nigeria can export more processed cashew products, enhancing job creation and foreign exchange earnings,” Samuel explained.

Additionally, streamlining export procedures, reducing trade barriers, and negotiating favorable trade agreements are vital for Nigerian cashew exporters to access international markets. The African Continental Free Trade Area (AfCFTA) presents a significant opportunity in this regard.

Exploring the development of a vibrant cashew-based manufacturing industry can further enhance Nigeria’s economic potential. Producing cashew-derived chemicals, paints, varnishes, and other industrial products can diversify the economy and create additional job opportunities.

By tapping into the potential of the cashew industry and other high-value agricultural commodities, Nigeria can diversify its exports, create jobs, reduce unemployment, and increase foreign exchange earnings. This will not only promote economic growth but also improve the livelihoods of millions of Nigerians.