• This policy will further push growers, processors out of business – NASPAN
• Policy heightens uncertainty, risk in value chain – CPPE
• The move is right and very sound – PEDA
• Aggregators count losses, raises fear of job losses

THE Federal Government’s decision to extend the ban on the export of raw shea nuts has deepened the crisis facing shea value chain, with thousands of aggregators awaiting a window to offload thousands of metric thousands piled up in different parts of the countries counting their losses.

The government said the policy has recorded modest impacts with investments in the value chain, especially processing, witnessing significant interest from both local and foreign processors. The extension could consolidate the six-month gains.

The ban, first introduced in August 2025 and now prolonged again, was designed to stimulate domestic value addition, boost processing capacity and promote industrialisation.
But nearly six months into the policy, stakeholders said the intended outcomes remain elusive, while the economic fallout has intensified.

From pickers in Niger and Kwara states to aggregators in Ogbomosho and processors across the Middle Belt, operators said the sector is under severe strain, one characterised by unsold inventories, loan defaults and idle factories.

Before the ban, Nigeria was a major supplier of raw shea nuts to international processors, particularly in Europe and Asia. According to industry sources, foreign buyers were prepared to inject tens of billions of naira into the market this season. To further the objectives, the President has authorised the two ministers of the Federal Ministry of Industry, Trade and Investment, and the Presidential Food Security Coordination Unit (PFSCU) to coordinate the implementation of a unified, evidence-based national framework that aligns industrialisation, trade, and investment priorities across the shea nut value chain.

Though some industry players who supported this policy said it signals a shift from commodity export dependency to boost local production and value retention, the growers, especially rural women farmers and processors are already biting their nails, as majority have not recovered from the losses incurred within the six months that has just elapsed.

The Guardian confirmed from the farmers that while the last six months have been hellish, as many of them have incurred huge losses and could hardly put food on their tables, they lamented that the next one year might be terrible.

It was learnt that a tonne of the raw shea nut sold between N1.2m and N1.3m before the ban last August. Now they go for between N500, 000 and N550, 000.
Chief Executive Officer of Farm Produce Merchant and Farm Input and Output Logistics Services in Abuja, Peter Augustine, said a Danish multinational, AAK Group, returned to Nigeria in 2025 with an estimated N80 billion procurement plan and a target to purchase 60,000 metric tonnes of shea nuts at N1, 200 per kilogramme. By his calculation, that translates to N72 billion circulating within rural communities.

“They came with contracts, insisted on tax compliance, quality standards and no child labour. They trained suppliers and were ready to buy. Then from nowhere, the ban was announced,” Augustine said.
Augustine alone invested N39 million to supply 2,000 metric tonnes under contract. He employed between 50 and 70 women daily for cracking and processing, paid for warehouses, firewood, cooking and logistics. When the ban took effect, the contract collapsed.

“If I sell now, I can’t recover my capital. It is a straight loss,” he said.
He alleged that while Nigeria shut out the buyer, the company shifted purchases to Ghana, Togo, Benin and Cameroon at even higher prices, indirectly incentivising cross-border smuggling of Nigerian nuts.
For another expert, CEO of Dapfen Multiglobal Industries, Owolabi Michael, he described the past year as “a terrible experience in the agric-industry.”

He said he was forced to lay off 38 women workers within 24 hours of the initial ban.
“Goods that were to sell at N1.2 million per tonne had to go at N850,000. That is a loss of N350,000 per tonne,” he said, noting that 200 tonnes sold at that discount wiped out tens of millions of naira in working capital.

The Niger State Coordinator, National Shea Products Association of Nigeria (NASPAN), Jummai Shekarau, told The Guardian that with the policy, hundreds of the farmers and processors might be forced out of business at the expiration of the ban extension.

“This policy has greatly affected people in the North where this produce is cultivated. It has seriously affected people in the rural areas because they are the ones going into the bush to bring this commodity, and that’s what puts food on their tables. So, since nobody will be coming from the airport, the city to the villages to get the raw shea nuts, they no longer go to the bushes to pick these nuts and no income for them.

This ban has advantages and disadvantages. For us, the professors, it will be good if the Federal Government can make it possible for investors to come into the country to patronise our homemade products, this will boost the economy of the country, the state and will not make us to feel the negative impact of this ban.

“It is from the nuts that we get the butter, producers from other countries that do not have these nuts actually know the value of our shea nuts, aside from extracting the butter after processing, they can also use the waste of the raw material to process other commodities. So, that’s why they prefer to buy the raw shea nuts and take out of the country to process with their own machine because we don’t have the equipment in Nigeria.

“We don’t have modern equipment for us to process this. We are using manual – our hands and energy for the processing. So, it has actually affected us seriously because the price of the (shea) nuts has crashed, even the price of the butter too.”

Shekarau noted that the people in the business are currently crying because they have lost a lot of money from the crashed price and gradually losing their source of livelihood. “I can confirm to you that several millions of naira have been lost in the last six months and our people are still losing money. They no longer have the opportunity to take the commodity to the borders, or move it out of the country. Even, some of these produce are still stuck in their warehouses now.”

The Centre for the Promotion of Private Enterprise (CPPE), said while the ban is a laudable goal, intended to accelerate domestic value addition and support Nigeria’s industrialisation drive, the instantaneous implementation of the ban has created severe disruptions in the shea nut value chain—hurting farmers, aggregators, exporters, and logistics providers.

The Chief Executive Officer (CEO) of CPPE, Dr Muda Yusuf, said the ban should have been a phased, consultative transition framework, to safeguard investor confidence, preserve hard-won gains in non-oil exports, and ensure inclusive, market-driven growth.

“Nigeria holds significant potential in the global shea nuts market, accounting for an estimated 40 per cent of global production. Moving up the value chain through local processing could generate jobs, foreign exchange, and industrial capacity. However, policy credibility is crucial: sudden bans on exports with immediate effect introduce uncertainty, heighten risk, and undermine investor confidence—deterring investment not just in shea but across the broader non-oil export sector.

He listed key challenges of the policy to include: Market Disruptions and Price Collapse; Investor Confidence at Risk; and Employment and Social Impact. “Shea nut prices have fallen by over 30 per cent since the ban, eroding incomes of farmers and aggregators; existing export contracts face potential default, exposing exporters to legal and reputational risks; and loan defaults loom large, as many exporters rely on bank financing for procurement and aggregation.

“The abrupt policy shifts has sent negative signals to investors, who may perceive higher policy risk in Nigeria; and the progress made in non-oil exports—over $3b in the first quarter of last year —could be reversed if confidence declines. On the employment and social impact, the ban threatens thousands of jobs in cultivation, aggregation, logistics, and trade in shea nuts, it also effectively penalises primary producers to benefit processors, creating a zero-sum scenario rather than a shared-growth model.

The Guardian learnt from inside sources that while the Federal Government is pursuing this course, especially with the backing of the Minister of State for Industry, John Enoh, and the Minister of Agriculture and Food Security, Abubakar Kyari, who insisted that Nigeria cannot continue with the decades of economic slavery, the Minister of Trade, Trade and Investment, Dr Jumoke Oduwole, and others share the sentiment of the farmers and processors that there could be an alternative to an abrupt export ban.

On his part, the Chief Executive Officer of Produce Export Development Alliance (PEDA), formerly AFGEAN, Adetiloye Aiyeola said the policy is right and very sound. “It signals that we are shifting from commodity export dependency towards something more value added that would boost our agro industrial base. Quite frankly, I can see that this would resonate across key value chains in the coming months.

“For me, from where I stand, there are three major reasons why this policy direction makes sense. The first one is that Nigeria currently produces a significant share of global, raw shea nuts, but it only captures a small fraction of the value in the global market.

“Nigeria accounts for about 40 per cent of global, shea nuts output, and it just only captures about one per cent of the total $6,300,000,000 industry. And, you know, it’s good for us to capture more of that value in that market, especially knowing that refined shea butter and its derivatives are used in things like cosmetics, food, and pharmaceuticals.

“The second reason is that, formalising exports to the Nigerian commodity exchange, increase transparency. It will reduce the informal sector, and it would really improve the price transparency for both buyers and both sellers. It’s a framework that has been implemented in several countries. And in those West African countries that it has been implemented, you can see more of a regulated marketplace with approved guidelines, and this is really good.

“The third is that the policy really aligns with our broader national goal, which is driving industrialisation, job creation, and more growth in more inclusive growth across sectors. So by restraining us from exporting the raw materials, we will be forced or we’ll be incentivised rather to process within the country.”
He said this would strengthen the country’s manufacturing base to preserve the local economic value, and increase foreign exchange earnings from higher value exports. “Now the impact on exporters is a different thing entirely. In the short term, exporters who have relied on the waiver for direct shipment of raw nuts need to now adjust.

“We need to adjust, and that might include a lot of change in logistics, compliance, and trading. And for some traders, especially those that are used to the informal channels, this transition will be very restrictive for them. But in the mid to long term, what I see is that the policies would offer upside opportunities.”

To rescue growers and processors from their “predicament”, Shekarau advised the Federal Government to review the policy to help majority of growers who rely solely on the business to feed their family and many of the players who have been practically thrown out of business.
For Lekan Omotosho, a supplier and contractor, shea processing plants are capital-intensive projects costing hundreds of thousands to millions of dollars, depending on capacity. “These are not turnkey projects. Equipment is imported. Installation takes 12 to 18 months at best, often longer. Projects typically require two years before production begins,” he said.

Director of Sustainability and Climate Adaptation at the National Shea Products Association of Nigeria (NASPAN), Elizabeth Nwankwo, much of the shea butter produced locally fails to meet international industrial standards.
She explained that Free Fatty Acid (FFA) levels, a key quality metric, should not exceed five per cent for industrial buyers. “Why is something that should be five per cent coming at 17 per cent? Who will buy it?” she queried.
Founder of The Aké Collective, Cobi Akinrele, who works with small-scale farmers in Plateau State, she said the ban does not automatically translate into value addition.

“To ban it doesn’t mean farmers will suddenly start making shea butter. They won’t,” she said. “There’s no investment in training, clean water systems, machinery or power.”
She recalled attempts to pivot into shea butter production during the first ban period. Samples sent to buyers in Europe and the United States were rejected for poor quality and high prices compared to Ghana and Burkina Faso.
“Our standards are not competitive. Most of our export goes to markets that are less strict. When you face European buyers, you see the gap,” she said.

In a communiqué, NASPAN acknowledged the government’s industrialisation intent but warned that without a structured licensing framework, the ban could repeat past mistakes.
The association proposed licensing four categories of actors: buying agents, aggregators, processors and exporters of processed products only.

Under the framework, only licensed buying agents would purchase nuts at farmgate level, with mandatory training on grading, storage and pricing ethics. Aggregators would be required to maintain traceability systems and submit data on volumes and prices, feeding into a national market intelligence system.

Processors would disclose installed capacity and utilisation levels to enable targeted incentives, while exporters would demonstrate proof of processing origin and quality certification.

NASPAN argued that licensing would improve compliance, reduce smuggling, strengthen quality assurance and promote inclusion of women, who account for over 90 per cent of primary actors in the shea collection segment.

“Licensing is the operational backbone that will translate policy intent into measurable outcomes,” the communiqué stated.
The broader implication for industrial growth lies in investor confidence. Stakeholders warn that abrupt policy shifts discourage capital inflows into agriculture and agro-processing. Several sources said financiers are now reluctant to fund shea-related ventures.