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Relevance of palm oil on Nigeria ecosystem

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By Abdulwasiu Usman

Currently, Nigeria is the fifth largest producer of palm oil globally.

Nigeria palm oil industry has an intriguing history, being the dominant global producer in the early 1960s with a staggering 43% market share. However, there has been a shift in recent times. In 2018, Nigeria had slipped to the third position, producing palm oil on approximately 2.3 million hectares (5.7 million acres) of cultivated land. However, this transformation signifies Nigeria’s firm dedication to rejuvenating the sector. Nigeria, once serving as a global powerhouse, now finds itself positioned as the fifth largest producer in the world, a ranking it has maintained for over half a decade.

With its current contribution to the global production of around 74.08 million metric tonnes (MT) being less than 2% (equivalent to 1.4 million MT), the country falls behind production leaders such as Columbia (1.8 million MT), Thailand (3.3 million MT), Malaysia (19.2 million MT), and Indonesia (45.5 million MT). Notably, oil palm fruit stands out as an incredibly efficient crop, surpassing all other vegetable crops in terms of oil yield per land area. The oil palm fruits yield a varying rate of oil extraction, typically falling within the range of 17-27%.

About $20 billion could have been generated from the sector.

Palm oil is of great importance within Nigerian economy, as it is not only utilized for cooking oil due to its high carotene content, but also a crucial resource in the production of detergents, soap, margarine, confectionery, and bakery trade. The oil also serves as a valuable additive in animal feed, making a significant contribution. The versatile oil offers a harmonious blend of vital nutrients, constituted by about 50% saturated fat, 40% unsaturated fat, and 10% polyunsaturated fat. This unique composition not only ensures balance but also contributes to its immense worth across various arenas, including household consumption and industrial usage, due to its adaptability.

The Central Bank of Nigeria (CBN) asserts that if Nigeria had sustained its position as the top player in the palm oil sector, the nation would presently be generating an estimated $20 billion each year from palm oil cultivation and processing. Despite a decade of increased of the oil production in Nigeria, there has been little effect on domestic consumption or the country’s standing in the global market. Production levels surged steady over the years: 890,000 MT in 2015, progressing to 990,000 MT in 2016, rising further to 1.03 million MT in 2017. The upward trend continued with 1.13 million MT in 2018, and finally peaked at 1.14 million MT in 2019.

Consumption of the oil rose to 1.7 million metric tons in 2022.

Based on the data, Nigerian palm oil production had an average of 1.4 million metric tonnes in both 2021 and 2022, while in 2020, it stood at 1.3 million MT. By 2023, palm oil production in Nigeria had reached 1.4 million metric tons. Throughout the period from 2009 to 2023, the production quantity generally witnessed an upward trend, with the most substantial growth occurring in 2010 at an approximate rate of 14%. Starting in 2014, there was a noticeable upward trajectory in the productivity of the oil. Nigeria, boasting of over 200 million population, has an annual intake of approximately three million metric tons of fats and oils.

A research conducted by PricewaterhouseCoopers, a globally auditing firm, unveiled that the oil constituted about 45% of the overall consumption in 2018. The United States Department of Agriculture reported that Nigeria, in particular, held the title for the largest consumer of the oil on the African continent, having consumed 1.4 million MT in 2018. As of the 2021/2022 crop season, Nigeria’s palm oil consumption skyrocketed to an impressive 1.7 million metric tons. The farm product’s soaring consumption over the past decade has reached its pinnacle, signifying its significance as a prominent crop within the nation, meeting a rising demand within the local market.

Importation of the oil rose to 518,000 metric tons in 2013.

The majority of the oil finds its purpose in industries, with a smaller fraction being utilized in households. However, despite the rate of production, Nigeria experienced a significant surge in the oil imports. In 2018 alone, Nigeria imported a total of 350,000 metric tons of the oil, signifying an escalation in import volume when juxtaposed with the three years prior. In 2013, 518,000 metric tons of the oil was imported, marking the highest point during the observed period. Even more interestingly, recent data from Statista in 2018 reveals that Nigeria secures the 6th spot amongst African nations in terms of the oil export volume.

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1 month ago

Relevance of palm oil on Nigeria’s ecosystem.Currently, Nigeria is the fifth largest producer of palm oil globally. – Express your point of view.

1 month ago

The importance of palm oil to the Nigerian ecosystem Nigeria is currently the world’s fifth-largest palm oil producer. Our environment greatly depends on palm oil. It’s critical that it prospers in our agriculture industry. Our agricultural economy could use a lot of aid from cash crops like palm oil.

Adeoye Adegoke
1 month ago

Nigeria being the fifth largest producer of palm oil globally definitely has an impact on the country’s ecosystem.
Palm oil production has both positive and negative effects on the environment. On one hand, it contributes to economic growth, job creation, and foreign exchange earnings for Nigeria. It’s an important agricultural commodity that supports livelihoods and helps alleviate poverty.
However, the expansion of palm oil plantations can lead to deforestation, loss of biodiversity, and habitat destruction. Clearing land for palm oil cultivation can result in the loss of valuable ecosystems, including rainforests and wildlife habitats. This can have detrimental effects on local flora and fauna, including endangered species.
To ensure a sustainable palm oil industry, it’s crucial to promote responsible practices that minimize environmental impacts. This includes implementing measures such as sustainable land management, protecting high conservation value areas, and supporting small-scale farmers who adopt sustainable farming methods..
By balancing economic development with environmental conservation, Nigeria can strive towards a palm oil industry that benefits both the economy and the ecosystem. It’s important to find a sustainable approach that minimizes negative impacts and maximizes the positive contributions of palm oil production.

1 month ago

Due to its high carotene content, palm oil is not only used as cooking oil but also as a valuable additive in animal feed. Because of this, palm oil plays a significant role in the Nigerian economy. Nigeria can work toward developing a palm oil industry that benefits the country’s economy and environment.

1 month ago

The evolution of Nigeria’s palm oil industry is intriguing, once a global powerhouse but now the fifth-largest producer. Palm oil plays a vital role in the economy, utilized in diverse sectors. Despite increased production, Nigeria imports significant quantities. The Central Bank suggests the nation could generate $20 billion yearly if it maintained its top position. With consumption soaring to 1.7 million metric tons in 2022, palm oil remains a critical crop meeting local demand.