Nigeria’s recent six-month ban on shea nut exports has triggered mixed reactions within the industry, with traders warning of potential contract defaults while processors say the move could strengthen domestic capacity.
The policy, announced by President Bola Tinubu earlier this month, is aimed at securing supply for local processors, protecting jobs, and supporting a value chain in which women account for 95 per cent of pickers. But market activity has already been disrupted, with the price of shea nuts falling by a third to N800,000 per tonne, according to commodity data tracked by Lagos-based consultancy Vestance.
“Exports made the market vibrant. Local demand is not as high as local supply,” Vestance Chief Executive Officer, Rildwan Bello, told Bloomberg. “The idea of growing the local industry doesn’t happen overnight. You don’t set up a processing industry within two months. The manner of the implementation leaves a lot to be desired.”
The shea nut industry, which produces about 500,000 tonnes annually in Nigeria, plays a significant role in rural economies across the northern states. With the export freeze, exporters say they face the risk of breaching supply agreements, while buyers in Europe and Asia may turn to competitors in Burkina Faso, Ghana, Mali, Ivory Coast, and Togo—all of which already restrict raw exports in favour of domestic processing.
Some processors, however, see the ban as an opportunity. Chief Executive Officer of Lagos-based Shea Origin, Mobola Sagoe, said the measure could curb the illegal movement of raw nuts across borders and channel more supply into Nigerian factories. “This decision could not have come at a better time,” she said.
Shea butter, extracted from the nut, is widely used in cosmetics and food industries, with global players such as Bunge Loders Croklaan and AAK AB operating plants in West Africa. Nigerian officials say the ban will help the country capture more value from a global market estimated at $6.5 billion, where despite producing almost 40 per cent of the nuts, Nigeria earns less than one per cent of revenues.
For now, the immediate effects are being felt by traders and exporters. Whether processors can absorb the increased supply over the coming months remains a central question for the industry.
