Nigeria’s sugar industry hit by decline in sugarcane output
May 12, 2021932 views0 comments
Nigeria’s sugarcane output for the 2021/22 marketing year is far from sweet as the country is projected to produce an estimated 70,000 metric tonnes in the 2021/22 marketing year, a seven per cent shortfall compared to 75,000 metric tonnes recorded in the 2020/21 marketing year, the United States Department of Agriculture (USDA) stated in its latest domestic production report.
This, market watchers opine, is a blow to the National Sugar Master Plan (NSMP) established by the government as a strategic roadmap to develop the sugar production industry and curb rising importation of the essential commodity.
Commodity analysts also noted that top sugar producers including Dangote Sugar PLC,BUA Sugar, Golden Sugar Company Ltd, among others, are likely to bear the brunt of the sugarcane output crunch as efforts towards backward integration and companies’ sugar production performances tread on slippery returns especially as these companies have reportedly committed millions of dollars towards expansion projects in line with the NSMP.
Sugarcane is a predominant crop used in the production of sugar and is grown across many parts of Nigeria, most especially in Adamawa,Jigawa,Kebbi, Kwara,Niger, Sokoto, Oyo and Taraba States. However, the recent production decline in Africa’s largest economy has been attributed to challenges characterised by insecurities in sugarcane planting communities, land disputes, host communities’ hostility, lack of long tenured financing opportunities among others.
Analysts assert that the challenges facing the sugar producing zones have overshadowed the investments made by the domestic sugar millers who have increased sugar refineries capacity in the country from 2.75 million metric tons per annum in 2019 to 3.4 million metric tons per annum in 2020, but operating at less than 70 per cent capacity.
The country’s raw sugar importation for the 2021/22 season currently stands at 1.8 million metric tonnes, up over three per cent from the 1.75 million million tonnes recorded the previous season, a situation many industry players attributed to the challenges encountered in sugarcane production.
On the other hand, Nigeria’s refined sugar exports in 2021/22 is expected to grow by 17 per cent at 350,000 metric tons (MT), higher than 2020/21 estimates.