Nigeria: Foreign Trade Slumps By 27.30% In Q2 2020

The National Bureau of Statistics (NBS) has revealed that Nigeria’s external merchandise trade (Foreign trade) dropped by 27.30% to N6.24 trillion in second-quarter, Q2 2020 compared to N8.59 trillion in the previous quarter.

Brandnewsday learned that the statistics further portrayed that the value of total imports dropped by 10.69% in Q2, 2020 against the level recorded in Q1,2020 but increased by 0.39% year-on-year

Imports:

Imported Agricultural goods rose in value by 59.01% in Q2,2020 compared to Q1, 2020 and 66.28% compared to the corresponding quarter in 2019;

Raw material imports increased by 85.69% in Q2,2020 compared to Q1, 2020 and 64.69% year-on-year.
Solid minerals imports increased in value by 35.51% in Q2,2020 compared to Q1, 2020 but decreased 0.47% compared to Q2,2019.

Manufactured goods imports increased in value by 4.69% in Q2, 2020 compared to Q1, 2020 and 12.72% year-on-year.

READ: Nigeria Suffers Foreign Trade Deficit Of N0.14 Trillion, As Crude Oil Exports Decline

Energy goods imports increased tremendously by 591.47% in Q2, 2020 compared to Q1, 2020 and 129.78% year-on-year.

Other oil products imports decreased by 82.32% in Q2,2020 compared to Q1, 2020 and 75.66% when compared to Q2, 2019.

Exports:

Total exports were 45.64% lower in Q2,2020 than Q1,2020 and 51.73% lower than Q2, 2019.

Agricultural goods export dropped 38.2% in Q2,2020 compared to Q1, 2020 but rose 6.3% year-on-year
Raw material goods export recorded a decrease of 56.2% in Q2,2020 compared to Q1, 2020 and 52.4% compared with the same quarter in 2019.

Solid minerals exports registered a decrease of 2.3% in Q2,2020 compared to Q1,2020 and 79.4% compared to Q2,2019.

Manufactured goods export decreased in value by 42.8% in Q2,2020 against the level recorded in Q1,2020 but increased 139.6% compared with the corresponding quarter in 2019.

Foreign Trade

Crude oil exports decreased in value by 47.2% in Q2,2020 compared to Q1, 2020 and 60.5% year-on-year.
Energy goods decreased by 13.7% in Q2, 2020 compared to Q1, 2020 and 53.8% year-on-year.

Other oil products decreased by 40.7% in Q2,2020 compared to Q1, 2020 and 28% compared to Q2,2019.
Nigeria: Foreign Trade Drops by 27.30% in Q2.

Major export trading partners and percentage share in Q2, 2020 export trade.

• Major Traded Agricultural Products
• Superior quality raw cocoa beans
• Sesamum seeds, whether or not broken
• Cashew nuts, in shell
• Good fermented Nigerian cocoa beans
• Cashew nuts shelled
• Other Frozen shrimps and prawns
• Natural cocoa butter
• Ginger
• Coconuts, desiccated, fresh or dried, whether or not shelled or peeled
• Shea nuts

Foreign Trade Overview

The value of Nigeria’s merchandise trade stood at N6,242.4billion in Q2, 2020. This indicates a sharp fall of 27.30% in Q2, 2020 compared to Q1, 2020 and 27.46% compared to Q2, 2019. The value of total trade year to date amounted to N14,829.4billion, indicating a drop of 11.96% compared to half-year 2019.

The import component was valued at N4,022.9billion representing a drop of 10.69% in Q2, 2020 against the level recorded in Q1,2020 but an increase of 0.39% year-on-year. The export component accounted for N2,219.5 billion of the total trade, indicating a decline of 45.64% against the value recorded in Q1, 2020 and 51.73% compared to Q2, 2019.

READ: Food Price Pressure Skyrocket Inflation To 28-Month High in July

Consequently, the trade balance recorded a deficit of N1,803.3billion, marking the third consecutive quarter of negative trade balance. This compares with trade in the goods deficit of N421.3 billion recorded in Q1, 2020 and N579.06billion recorded in Q4 2019.

The predominant export remained Crude oil, valued at N1,553.9billion representing 70.01% of total exports while non-crude oil totalled N665.6billion showing 29.99% of total export during the review period.

Imports Classified by Standard International Trade Classification and country of Origin

The value of total imports amounted to N4,022.9billion in Q2, 2020. This represents a drop of 10.69% against the level recorded in Q1,2020 but an increase of just 0.39% year-on-year. The year to date import value amounted to N8,527billion or 10.58% over the half the year 2019.

The fall in the value of import in Q2,2020 can be attributed to the decrease in the value of mineral fuels (N1031.9billion or 82.35%), Machinery and Transport equipment (N147.2billion or 8.43%) and Miscellaneous manufactured articles (N157.5 billion or 47.94%) against their respective values in Quarter 1, 2020.

The structure of imports under this category showed that Machinery and transport equipment accounted for the largest share of imports, at N1,598.8billion or 39.7% of total imports, followed by Chemicals and related products, valued at N776.3billion or 19.30% and Food and Live Animals worth N648.6billion or 16.1% among others.

During the quarter, Nigeria imported goods mainly from Asia, which was valued at N2,122.6billion or 52.8%. Other imports originated from Europe, valued at N1,070.4billion or 26.6% while imports from America and Africa amounted to N605.2billion or 15% and N174billion or 4.3% respectively. Import from Oceania stood at N50.6billion or 1.3% while goods valued at N31.1billion originated from ECOWAS.

Nigeria’s imports, by country of origin, shows goods were imported mainly from China (N1,263.6billion or 31.41%), United States (N428.9billion or 10.66%), India (N322.3 billion or 8.01), and the Netherlands (N202.9billion or 5.04% respectively.

Exports Classified by Standard International Trade Classification and Country of Destination

The value of exports in Q2, 2020 stood at N2,219.5billion, a decrease of 45.64% compared to Q1, 2020 and 51.73% compared to Q2, 2019. The year to date export amounted to N6,302.4billion, representing a 31% decline compared to 2019.

READ: Why Annual Inflation Rate Rose Further To 12.26% In March On Imported Food

Exports by section revealed that mineral products accounted for the largest portion of exports, amounting to N1,872.4billion or 84.35%, mainly due to the crude oil component. This section was followed by Vehicles aircraft and parts (N221.2billion or 9.96%) and others.

Analysis of export by Region revealed that Nigeria exported most products to Europe (N976.5billion or 44%), followed by Asia (N734.1billion or 33.08%), Africa (N401.4billion or 18.1%), America (N105.8billion or 4.8%) and Oceania (N1.7billion or 0.08%). Within Africa, goods worth N149.3billion were exported to ECOWAS member states.

All regions recorded declines in the value of exported goods during the quarter, although China and Japan each recorded increased export activity.

Exports by Country of destination showed that Nigeria exported goods to Spain valued at (N310.8billion or 14%), Netherlands (N243.7billion or 10.98%), China (N220.4billion or 9.9%), India (N195.6billion or 8.8%) and South Africa (N172.2 or 7.7%)

Foreign Trade: Export/Imports Products Classified by Sectors Q2, 2020

Agricultural Goods Sector

During the quarter, total trade in Agricultural goods stood at N493.7billion, of which exported agricultural goods accounted for N78.1billion. Analysis by economic region showed that most Agricultural goods were exported to Asia, Europe and America valued at N43.6billion, N26.4billion and N6.6billion.

The key driver of agricultural products exports were Superior quality raw cocoa beans, Sesamum seeds, Cashew nuts, well-fermented cocoa beans and more. The main consumers of superior quality cocoa were The Netherlands (N9.3billion), Indonesia(N3.7billion) and United States(N2.4billion).

Other Agricultural exports were Sesamum seeds exported to Japan (N6.0 billion) and to China, worth N2.3billion. Also, Cashew nuts were exported to Vietnam, worth N12billion.

READ: Africa Is The Largest Cocoa Producing Region In The World- Jo Thys

In terms of imports, Durum wheat worth N41billion was imported from the United States, Russia (N28.8billion) and Latvia (N24.5billion).

Solid Minerals Sector

The value of total trade in solid mineral goods stood at N30.5billion in Q2, 2020, comprising an import component of N28.97 billion and an export component of N1.6billion. The major products exported under this sector were Cement clinkers, exported to Senegal, valued at N 0.44billion. This was followed by Manganese ores and concentrates exported to China, worth N0.42billion and Lead ores and concentrate exported also to China, and worth N 0.39billion.

In terms of imports, plasters of Calcined Gypsum was mainly imported from Turkey, worth N4billion and Egypt (N2.5billion). There was also the import of Gypsum from Spain worth N3.78billion and Crude salt from Brazil worth N3.6billion.

Manufactured Goods Sector

The value of manufactured goods trade in Q2, 2020 stood at N3,040.3billion. Out of this, the export component accounted for N254.2billion. The products that drove up Manufactured export were light vessels, Fire floats, floating Cranes exported to Spain in the value worth N129billion. There were also exports of vessels and other Floating structures to Cameroun (N32.8billion), Equatorial guinea (N36.9billion) and Singapore(N7.5billion).

Export trade on manufactured goods by Region showed that goods were exported mainly to Europe (N137.1billion) and within Africa (N96.98billion). On the other hand, manufactured imports stood at N2,786.2billion.

The main drivers were, used vehicles imported from the United States (N116billion), Netherlands (N28.5billion) and Brazil (N24.7billion). Other goods imported under this category were Motorcycles from India (N66.6billion) and China (N25.4billion).

During the quarter, Herbicides worth N58.8billion was imported from China while Machine for Reception was also imported from China amounting to N49.3billion. Import trade by Region showed that manufactured goods were mainly imported from Asia (N1,753.3billion) and Europe (N503.3billion).

Raw Material Goods Sector

The value of total trade in raw material stood at N585.4billion. The import component was valued at N570.6billion while the export component stood at N14.8billion. During the quarter, Urea worth N3.5billion was exported to Brazil and leather further prepared after tanning worth N1.2billion was exported to Spain.

In terms of imports, Cane sugar worth N43.3billion was imported from Brazil, Mixtures of Odoriferous substances worth N17.2billion was imported from Ireland and Food preparation worth N21.9billion was imported from India.

Foreign Trade Intensity in Q2 2020

Export Intensity Index with Five Major Trading Partners

Spain emerged as the leading trading partner of Nigeria in terms of export trade due to the re-export of an expensive floating vessel. Spain registered export intensities of 11.41, 4.99 and 6,85 for the month of April, May and June. The second leading partner in terms of export was India which registered export intensities of 5.09, 1.77 and 2.19.

Export trade with France was intense in April (1.50) and May(3.18) but low in June (0.74). During the quarter, China registered 0.33, 0.78 and 1.19 for April, May and June. Similarly, the Netherlands recorded 0.56, 1.39 and 0.72 in April, May and June respectively.

Import Intensity Index with five Major Trading Partners

In Q2,2020, the import intensity of trade with China was 2.14, 1.70, and 1.97 recorded for April, May, and June. There was also intense trade with India in all the months: April (3.96), May(4.57) and June(3.28). The similar index was recorded for the United States in April, May and June with 1.46, 1.57, and 1.22 respectively.

On the other hand, the import intensity index registered against Germany during the quarter was very low in all the months of April (0.65), May (0.67), and June (0.47).

Foreign Trade by Mode of Transport

The majority of commodity exported out of Nigeria were transported via water This was reflected in the value of exports by water in Q2,2020. Water transport accounted for N2,214.3 billion or 99.76% of total exports. Air transport contributed N1.1billion or o.o5% while Others accounted for N4.2billion or 0.19%.

Similarly, for imports, most goods brought into the country arrived via water transportation means, accounting for N3,768.2billion or 93.67% of the value of total imports. Another major mode of transport used was Air, which accounted for goods valued at N245.5billion or 6.1%.

Trade by Custom Ports and Post

In Q2, 2020, the bulk of export transactions was conducted through Apapa Port, with goods worth N1,911.97billion or 86.1% of total exports, followed by Port-Harcourt (3) which recorded N222.3billion or 10% and Tin Can Island, which was responsible for goods worth N72.7billion or 3.3%.

In terms of imports, Apapa Port also recorded the highest transactions valued at N1,620.5billion or 40.3% of total imports. This was followed by Tin Can Island, for goods worth N871.2billion or 21.7% of total imports. Port-Harcourt (3) accounted for goods valued at N383.4billion or 9.5%.