From Sugarcane to Sugar: Capturing the Sweet Opportunities in Backward Integration

By: Ciuci

/ September 5, 2024

From Sugarcane to Sugar: Capturing the Sweet Opportunities in Backward Integration

 

Overview of the Nigerian Sugar Industry


Nigeria’s sugar industry has significant opportunities for growth and development as the current domestic consumption far outweighs the local production level. According to the United States Department of Agriculture (USDA), Nigeria’s demand is 1.5 million tonnes of sugar per year with a potential market size of 1.7 billion tonnes (based on population and recommended daily sugar intake), making it the second largest consumer of sugar in Africa, after South Africa. Nigeria only produces about 2% of raw sugar, while the remaining 98% is imported and refined by a few mills.

The country’s sugar refineries depend almost exclusively on brown sugar imported from Brazil with an import value of about N530 billion annually. In 2012 alone, Nigeria spent about N99.2 billion on raw sugar imports. To reduce imports, local production will have to be improved across the entire country.

FIG. 1: Sugar Consumption vs. Production 2006 – 2012

 

FIG. 2 Sugar Consumption, Production and Import pattern (2006 – 2012)

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