Six Months After Ban, Nigeria’s Shea Industry Faces Crossroads
A Policy at the Edge of Expiry
AS the six-month temporary ban on shea nut exports approaches its 26th February deadline, uncertainty has gripped Nigeria’s multi-billion-naira shea industry. What was introduced as a bold experiment in industrial policy has now become a test of the Federal Government’s resolve to shift the economy from raw commodity exports to value-added production.
Behind closed doors in Abuja, senior cabinet members under President Bola Tinubu are said to be sharply divided over the way forward. While one camp insists the ban should be retained—or even made permanent—to consolidate gains in local processing, another favours a moderated approach to avoid destabilising exporters and farmers.
The stakes are high. Nigeria accounts for roughly 40 to 45 per cent of global shea kernel supply, yet captures barely one per cent of the estimated $6.5 billion global market value.
The Industrialisation Argument
Proponents of the ban argue that decades of exporting raw shea nuts have entrenched what development economists describe as the “commodity trap”—a cycle where countries export volumes but import value.
The Minister of State for Industry, John Enoh, and the Minister of Agriculture and Food Security, Abubakar Kyari, have reportedly championed the retention of the ban, framing it as a necessary break from what they call economic dependency. They contend that Nigeria cannot continue exporting raw kernels while importing finished cosmetics and food products derived from shea butter.
Their position aligns with the emerging National Industrial Policy and a proposed bill at the National Assembly seeking to prohibit the export of commodities without at least 30 per cent local value addition.
Supporters draw parallels with reforms in the oil sector, where Nigeria historically exported crude and imported refined products. Former African Development Bank president Akinwumi Adesina once described this export-import paradox as central to Africa’s poverty and unemployment crisis.
For industrial advocates, the shea ban represents more than a trade measure—it is a symbolic pivot toward economic transformation.
Exporters Push Back
Yet exporters and growers warn that abrupt policy shifts can disrupt fragile supply chains. Some analysts criticised the August export closure as a market shock, arguing that a phased restriction would have been less destabilising while still encouraging domestic investment.
Exporters are said to have warehoused thousands of metric tonnes of shea kernels in anticipation of a policy reversal. Farmers initially suffered price volatility when the ban took effect, with per-kilogramme prices dropping from around ₦850 to ₦570 before rebounding to about ₦1,000 as the market adjusted.
The Minister of Industry, Trade and Investment, Dr. Jumoke Oduwole, is believed to favour an alternative approach that balances industrial goals with trade realities, reflecting growers’ concerns over abrupt export prohibitions.
The tension underscores a broader ideological divide within government—between pro-trade advocates and those prioritising domestic value retention.
A Middle Path?
Amid the polarised debate, some policy thinkers propose a hybrid solution: backward integration. Under this model, export licences would be granted only to firms that demonstrate substantial investment in local processing facilities.
Such a framework could allow limited exports while incentivising companies to convert shea kernels into butter and other derivatives domestically.
Isyaku Rabiu of BUA Foods Plc previously argued that Nigeria could leverage the African Continental Free Trade Agreement (AfCFTA) to export refined shea products tariff-free across Africa, positioning the country as a continental processing hub.
Currently, only about 10 per cent of Nigeria’s annual shea production—estimated between 300,000 and 500,000 metric tonnes—is processed locally.
Global Pressures and Local Realities
The policy debate is unfolding against the backdrop of global competition. Countries such as Burkina Faso, Ghana, Mali, Ivory Coast and Togo have implemented measures to restrict raw shea exports in favour of local processing.
At the same time, foreign cosmetic industries reliant on West African shea have reportedly intensified lobbying efforts to maintain access to raw materials.
Nigeria’s domestic cosmetics and food manufacturers argue that unrestricted exports previously starved them of feedstock, forcing capacity utilisation below 50 per cent and undermining job creation.
As the deadline looms, the Federal Government has signalled that a complete return to unconditional exports is unlikely. But the shape of the revised policy remains unclear.
Whether Nigeria doubles down on industrialisation or recalibrates toward moderation, the decision will send a powerful signal about the country’s long-term economic direction.
