Business

Brazil earns N407bn from sugar export to Nigeria

●Supply represents 84.58% of consumption

 

Some 2.68million tonnes of sugar valued at N407.4billion ($905.3billion) have been exported by Brazil to Nigeria within the last two years. The commodity is 84.58 per cent of the total $1.07billion foreign sugar shipped to Nigeria between 2018 and 2019.

 

Brazil, which is the top supplier, exported $446,4million and $458.91million, while the total sugar exported in 2018 was $520.18 and $545.75million in 2019 as demand reached 1.7 million metric tonnes in 2020.

 

Last week, Nigerian Ports Authority (NPA)’s shipping position revealed that a total of 194, 050 tonnes was ferried to Lagos port by four vessels to Apapa Bulk Terminal Limited (ABTL) and Greenview Nigeria Development Lim- ited (GNDL). Desert Hope with 52, 350tonnes offloaded its cargo at ABTL of the port, while SBI Bravo with 49,000tonnes, Almasi, 46,400tonnes and Genco Provence, 46300tonnes have been moored at GDNL.

 

According to International Sugar Organisation (ISO), the daily price of sugar at the global market, which was $365.70 per tonne in January 2020, had fallen to $217.53 per tonne or 40.1 per cent since April, 2020, following the outbreak of the corona virus pandemic.

 

In June, 2020, a total of 138, 115 tonnes of the commodity was ferried by three vessels to Lagos Port complex, with Hinoki laden with 46,900tonnes; Spar Mira, 46,500 tonnes and Aruna Ece, 44,715 tonnes.

 

Finding by New Telegraph revealed that domestic production by sugar firms had further decreased by 6.25 per cent from 80,000 metric tonnes to 75,000 tonnes per cent since 2019 due to lack of infrastructure to meet local demand. It would be recalled that in January 2013, three refineries were approved by National Sugar Development Council (NSDC) under its backward integration programme.

 

Operators were made to sign formal commitments, detailing a number of indicators by which their performance would be measured. Also, raw sugar quotas at the concessionary tariff of five per cent duty and five per cent levy were allocated to operators on the basis of performance of their BIP projects. It was gathered that the companies had invested over N157billion in sugar projects in the last six years.

 

Nevertheless, investigation revealed that their general performance was below average at about 40per cent of projected performance as importation of the commodity has further gone up by 1.07 per cent from 1.87million tonnes to 1.89million tonnes in one year because of the huge deficit.

 

Meanwhile, the Executive Secretary, National Sugar Development Council (NSDC), Dr Latif Busari, had explained that the country was currently producing only five per cent of its total demand, while it depends on importing the rest. He said in Abuja at the signing of “Sugarcane Irrigation’’ agreement between BUA and Netafim that the country would be self-sufficient in refined sugar production by 2023.

 

Busari noted that the agreement would boost sugarcane farming, thereby, providing raw materials for refined sugar production. He said: “We import raw sugar and our refineries which have a combined capacity of about three million metric tonnes refining capacity.

 

Dangote, BUA and Golden Sugar import raw sugar add a bit of value and in the process create some few jobs.” Government, had in 2012, said that no sugar would be allowed to come into the country from 2019, but up till now the country could not meet the projected 1.66 million metric tonnes of the commodity under the Nigerian Sugar Master Plan (NSMP). In the plan, government introduced 20 per cent import duty and 75 per cent levy on refined sugar this year.

 

Part of the incentives to boost domestic production of sugar include a five-year tax for investors in the value chain; 10 per cent import duty and 50 per cent levy on imported raw sugar; 20 per cent duty and 60 per cent levy for imported refined sugar.

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