Agricultural trade swings to N56bn deficit as export earnings

Nigeria’s agricultural trade balance has swung from a N740.27 billion surplus to a N56.13 billion deficit in just one year, exposing a widening gap between the country’s huge agricultural production base and its ability to generate foreign exchange from farm exports.

An analysis of first and second-quarter 2026 Foreign Trade Statistics released by the National Bureau of Statistics (NBS) showed that agricultural exports fell by 33.3 per cent to N1.98 trillion in the first half of 2026 from N2.96 trillion in the corresponding period of 2025.

Agricultural imports also declined, but at a much slower rate, falling 8.5 per cent from N2.22 trillion to N2.03 trillion.

The result was a dramatic reversal in the sector’s trade position, with the N56.13 billion H1 deficit contrasting sharply with the N740.27 billion surplus recorded in the first half of last year.

The deterioration was driven largely by the second quarter, when agricultural exports plunged to N802.99 billion from N1.26 trillion a year earlier, while imports increased slightly to N1.20 trillion from N1.18 trillion.

That produced an agricultural trade deficit of N400.78 billion in Q2, wiping out the N344.65 billion surplus recorded in the first quarter.

The figures raise questions about Nigeria’s ability to turn agriculture into a more reliable source of foreign exchange at a time when the government is seeking to diversify exports beyond crude oil.

Agriculture remains one of the largest sources of employment in the economy. NBS data show that 25.34 million Nigerians were engaged in agriculture, forestry and fishing in 2023, representing 30.1 per cent of the total workforce.

Yet the sector’s huge employment footprint is not translating into sustained export growth.

Several commodities still performed strongly in Q2. Standard quality cocoa beans generated N154.31 billion in exports, while sesame seeds contributed N96.03 billion. Superior quality cocoa beans brought in N58.82 billion, soya beans N50.22 billion, soya bean flour and meals N36.41 billion, and cut flowers and flower buds N31.43 billion.

Natural cocoa butter generated another N27.60 billion, while crude shea oil contributed N12.66 billion.

The export performance shows that Nigeria has commercially valuable agricultural products with established international demand. The problem is increasingly one of scale, productivity, processing capacity, logistics and the ability to consistently supply export markets.

A sharper decline in export earnings than imports also means the country is losing an important avenue for strengthening foreign exchange supply. That is particularly significant when the economy is trying to build a broader external earnings base through non-oil exports.

The agricultural trade reversal also exposes the cost of weak value addition. Exporting processed cocoa products, vegetable oils and other higher-value commodities can generate substantially more revenue than shipping raw produce, while creating additional jobs in processing, packaging, logistics and manufacturing.

For Nigeria, the latest figures therefore represent more than a deterioration in agricultural trade. They show that a sector employing nearly a third of the workforce is still struggling to convert its production capacity into consistent export earnings.

Reversing the deficit will require higher farm productivity, stronger irrigation, better storage and transport infrastructure, improved access to finance and greater investment in processing and export-quality standards.

Without those changes, Nigeria risks remaining a major agricultural producer without capturing the foreign exchange and industrial value that its large farming economy should generate.