Palm oil import bill rises 194% to N23bn

… Stakeholders tie rise to urbanisation, population growth, others
By Cynthia Alo
Nigeria’s import bill on palm oil rose by 194.4 percent year-on- year (yoy) to N23.16 billion in the first quarter of 2026 (Q1’26) from N7.87 billion in the corresponding period of 2025 (Q1’25).

This is contained in the National Bureau of Statistics (NBS) Foreign Trade in Goods Report which added that the Q1’26 figure also indicates a 65.4 percent quarter-on-quarter rise from N14 billion in Q4’25.

This comes against the backdrop of favourable climate for growth of palm trees in Nigeria. Nigeria has about 27 palm oil producing states including all nine states of the Niger Delta, and the South-East parts of the country.

Currently, Nigeria consumes about 2.4 million tonnes annually while local output is at 1.5 million tonnes, leaving a supply deficit of about 900,000 metric tonnes that is largely met through imports from West Africa and Asia. Meanwhile 80 percent of the production is done by small holder farmers who depend largely on manual processing techniques.

The remaining 20 percent are carried out by other processors including Okomu and Presco.

Weighing in on the situation, the Managing Director of Okomu Oil Palm Plc, Graham Hefer, noted that persistent import-driven competitive pressures have continued to impact domestic Palm oil prices.

He pointed out that the influx of unwholesome and poorly taxed foreign Palm oil into the local market is undercutting domestic producers, warning that unbridled importation poses a severe threat to local investments and threatens the survival of local oil palm expansion initiatives.

Experts’ insight

Actual import could be higher —NPPAN Boss

Speaking with Vanguard AgroBiz, the President of the National Palm Producers Association of Nigeria (NPPAN), Dr. Alphonsus Inyang, said the actual import bill for palm oil could be higher than officially reported.He said Nigeria’s palm oil consumption is estimated at about three million tonnes annually, while local production is roughly half that figure, leaving a wide supply gap that the industrial sector fills through imports from Indonesia, Ghana, Cote d’Ivoire, Benin Republic, Togo and Cameroon, alongside output from major local processors such as Presco and Okomu.

Inyang attributed the rising demand to urbanisation, noting that about 49 per cent of Nigerians now live in urban centres, driving consumption of palm oil-based products including bread, cosmetics, baby formula, detergents, soap and margarine.

He stated: “Urbanization is driving growth and demand for palm oil, and it will continue to do that because Nigeria’s population grows at about 3.5%, and the production demand for palm oil grows at 2.2% per year in Nigeria. And with the youngest population in the world, we see that this demand will continue to grow.“At the National Association of Oil Palm Producers, we can work with the government, both at the central and subnational level, to solve this problem.

“We need households to plant oil palm at one hectare per household, rural households. We need to focus on using the smallholder farmers. Indonesia and Malaysia, who control the industry today, used smallholders to develop the industry. “Currently, of the about 1.5 to 1.6 million tonnes we produce today, 80% of that is produced by smallholders.”

He said NPPAN is developing a plan to build a $20 billion oil palm economy within five years across two million hectares, and wants direct engagement with the government to execute it.

It reflects population growth —Olatujoye

Also speaking to Vanguard AgroBiz, the Chief Executive Officer of Palmfield Development and Processing Limited and former President of the National Palm Produce Association of Nigeria (NPPAN), Chief Henry Olatujoye, said the rising import bill reflects population growth outpacing local production capacity, rather than a policy failure.

Olatujoye said Nigeria’s oil palm plantation base cannot match those of Indonesia and Malaysia.

He noted that Indonesia has close to seven million hectares under cultivation and Malaysia about five million, while Nigeria’s commercial plantations average only 250,000 hectares, with wild groves adding roughly two million hectares more.

Olatujoye explained that about 80 per cent of imported palm oil goes into industrial use, which requires oil with free fatty acid (FFA) content below five per cent, while locally produced palm oil, preferred for cooking, typically has FFA levels of 10 to 15 per cent and cannot meet industrial bleaching standards.

“It’s not government’s fault. To establish an automated factory that can process daily harvested bunches, you need billions of naira and enough plantation capacity to back it,” he said.

Olatujoye added that Nigeria’s cultural preference for crude palm oil in cooking, unlike Malaysia and Indonesia where refined vegetable oil is used, limits the volume of oil meeting industrial specifications, keeping import demand high as the population grows.

Supply challenges linked to inadequate value addition, understanding—Tijani

Speaking in an interview with Vanguard at a recent event, a Research Scientist at the Nigerian Institute of Food Science and Technology (NIFST), Dr. Oseni Tijani, said Nigeria’s supply challenges were partly linked to inadequate value addition and limited understanding of modern palm oil processing techniques.

She also faulted how Nigerians consume palm oil, saying only the liquid layer, not the thick settled layer, should be eaten.

“We are not supposed to eat the thick layer of palm oil. It is an industrial raw material,” she said, adding that the liquid fraction carries the carotenoids, phytosterols, tocopherols and vitamins linked to better immunity and cardiovascular health.