Business
Manufacturers In Dire Straits As Unsold Goods Hit N470bn
Published
2 years agoon
By
Editor
The Nigerian manufacturing sector is struggling with rising levels of unsold goods with inventory stockpile up 22 per cent to N469.66 billion in 2022 from N384.58 billion in the preceding year. Also, industry operators are saying the situation is worsening.
A report from the bi-annual economic review of the Manufacturers Association of Nigeria (MAN), the umbrella body of manufacturers in Nigeria, attributed the rise in inventory to a drop in the purchasing power of Nigerians occasioned by sustained inflationary pressures and worsened by the cash crunch that hit the economy in the first quarter of 2023, Q1’23, in the wake of the Naira Redesign policy. Analysis of the report shows that the rise in inventory is despite a 9.7 percent decrease in the manufacturing sector factory output to N6.67 trillion in 2022 from N7.39 trillion in 2021.
Commenting on the development, Director General, MAN, Segun Ajayi-Kadir, stated: “Inventory of unsold goods in the sector totalled N469.66 billion in 2022 as against N384.58 billion recorded in 2021. The high inventory recorded in the period is attributed to low purchasing power in the economy due to the declining real income of households following the continuous increase in inflationary pressures in the country.
“This is worsened by the Naira Redesign policy which began in the last quarter of 2022. The withdrawal of a large amount of the ‘old Naira’ without commensurate replacement with the ‘new notes’ resulted in a cash crunch in the economy with very limited means of purchasing items by households across the country.
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“Inventory of unsold finished products in the manufacturing sector increased to N282.56 billion in the second half of 2022 up from N169.75 billion recorded in the corresponding half of 2021; thus, indicating N112.81 billion or 66 percent increase over the period. It also increased by N85.46 billion or 51 percent when compared with N187.1 billion recorded in the first half of the year.
“In the second half of 2022 as the cost of wheat and other food inputs increased; prices of fuels, particularly diesel rose by over 50 percent; cost of transportation logistics including shipping escalated even as the effect of COVID-19 pandemic is yet to fully die down. In addition to these challenges was the CBN policy on Redesigning the Naira.
“The CBN policy created a cash crunch that debilitated economic activities in the last quarter of 2022. This particularly affected the manufacturing sector adversely as it was extremely difficult to sell most of the Fast-Moving consumer Goods (FMCG) and other commodities by the sector in the period.” He called on the government to formulate and implement a national policy that would address the current high inflation in the country.
Factories closure imminent
Also speaking on the situation, MAN President, Francis Meshioye said: “The manufacturing sector has been struggling with crashing sales, mainly attributable to the sustained naira scarcity. A continuing decline in sale volumes will necessitate production cuts and a reevaluation of investments in the sector.
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“Specifically, if sales proceeds can no longer sustain business overheads and operating expenses, businesses will be forced to scale down their operations which would result in factory closures, job losses, a decline in exports and much more.”
FMCGs kick on excessive taxation
Meanwhile, operators in the Fast Moving Consumer Goods (FMCG) industry have urged national and sub-national governments in Nigeria to stop making the sub-sector the target of their revenue mobilisation drive; which has led to the slow pace of growth in the sector.
Director, Corporate Affairs & Sustainability, Coca Cola Hellenic Bottling Company, Mr. Ekuma Eze, who made the plea at a recent event, said the FMCG sector has borne the brunt of such revenue mobilisation drives.
According to him, the FMCGs, which form the largest chunk of the manufacturing sector in Nigeria, and the fourth largest sector of the nation’s economy sector, are overburdened with taxes and levies, compared with their counterparts in other countries.
Eze said the introduction of, and increase in taxes, in recent times, bore eloquent testimony that companies in the nation’s FMCG remain the target of the government’s revenue drive.
Company income tax rate in Nigeria is 30 percent for companies with gross turnover greater than N100 million, compared to an Africa average of 23.5% and a worldwide average of 23.4 percent.
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He stated further: “Tertiary Education Tax is now 3 percent going by the Finance Bill 2022.
“There’s been a consistent increase in excise tax for beer and tobacco companies while N10/1 excise tax was introduced in June 2022.
“The introduction of this new tax regime, due to price elasticity of demand, which is high among lower income consumers, who are major consumers of the products, has led to reduction in sales and a revenue decline of 16 percent between June 1 and December 2022.” He also lamented the negative impact of the recent Naira Redesign Policy on the sector, noting that the policy had succeeded in significantly reducing sales between February and March, this year, by between 20 percent and 60 percent.
According to him, the fallout of this is the re-organisation option being contemplated by some companies; a development, he noted, may further compound the nation’s unemployment issue.
Significant sales drop
“Many FMCGs reported significant sales decreases in February and March by between 20 to 60%. Many of these businesses are planning to restructure, which will worsen the unemployment problem,” Eze added.
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Recall that MAN had issued a statement on May 2, 2023 condemning the recently released 2023 Fiscal Policy Measures, FPM, by the Federal Ministry of Finance, Budget and National Planning, saying that it would lead to industry recession, capacity under-utilisation, and layoffs of workers.
“We are again emphasising the fact that the proposed increase in the recently released 2023 guidelines i.e., on Beer, Wines and Spirits, Tobacco, has the potential to trigger unprecedented distortions in the affected industries as well as the entire manufacturing sector. “The policy is capable of producing a negative effect on investments with a huge consequence on job retention in these industries,” MAN had stated.
Inflationary pressure
Also commenting, Dr Chinyere Almona, Director General, Lagos Chamber of Commerce and Industry (LCCI), lamented that the rising inflationary pressure has significant and worrisome impacts on both the household and business sectors.
Her words: “Since February 2016 to date, the country has recorded a double-digit monthly inflation rate, with an adverse effect on the size of its middle class.
“Apart from eroding purchasing power, it has led to inventory stockpiles. If left unchecked, the high inflation may further constrain production, lead to a steeper rise in poverty figures, frustrate economic growth, and lead to higher unemployment and non-competitive exports, especially in the sub-region. LCCI is concerned that despite consistent monetary policy rate hikes, taming the inflation trend has remained futile.
“We, however, appeal to the government to implement fiscal measures, such as reducing/ removing taxes on staple food items to protect the most vulnerable as well as spur demand-side growth.”
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Business
NNPCL Reduces Fuel Price After Dangote Refinery’s Adjustment
Published
1 week agoon
August 14, 2025By
Editor
The Nigerian National Petroleum Company Limited has reduced its premium motor spirit pump price on Thursday, according to DAILY POST.
It was confirmed that NNPCL retail outlets in the Federal Capital Territory, Abuja, have reduced their pump price to N890 per litre from N945.
This new fuel price has been reflected in NNPCL retail outlets such as mega station Danziyal Plaza, Central Area, Wuse Zone 4, Wuse Zone 6, and other of its filling stations in the nation’s capital.
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The latest downward review of fuel price in NNPCL outlets represents an N55 reduction in fuel pump price.
“It was reduced to N890 per litre this afternoon, down from N945,” an NNPCL fuel attendant told DAILY POST anonymously on Thursday.
This comes a Nigerian filling station, MRS Empire Energy, on Thursday adjusted their fuel pump price to N885 and N946 per litre, down from N910 and N955 per litre.
The latest fuel price reduction trend is unconnected to Dangote Refinery’s ex-depot petrol price adjustment by N30 to N820 per litre from N850 and the price of crude oil in the international market.

Dangote Petroleum Refinery has announced a reduction in the ex-depot (gantry) price of Premium Motor Spirit, PMS, commonly known as petrol, by N30, from N850 to N820 per litre, effective from August 12, 2025.
This was disclosed in a statement by the company’s spokesman, Anthony Chijiena, on Tuesday.
The 650,000-barrel-per-day plant said the move is part of its unwavering commitment to national development, assuring the public of a consistent and uninterrupted supply of petroleum products.
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“In line with our dedication to operational excellence and sustainable energy solutions, Dangote Petroleum Refinery will commence the phased deployment of 4,000 CNG-powered trucks for fuel distribution across Nigeria, effective August 15, 2025,” said Chijiena.
The announcement comes as the refinery prepares to commence direct fuel distribution nationwide. The development is expected to lead petroleum product marketers to reduce their pump prices in the coming days.
In Abuja, the retail fuel price stood between N885 and N970 per litre as of Tuesday evening.
Business
Indian Refiners Abandon Russia For Nigerian Crude, As Dangote Refinery Relies On US
Published
2 weeks agoon
August 11, 2025By
Editor
India Refineries have abandoned Russian crude for Nigerian crude, while domestic refiner Dangote Refinery relies heavily on West Texas Intermediate crude from the United States of America.
This followed a recent sanction threat by US president Donald Trump on India over continued patronage of Russian crude.
According to Reuters, industry sources said that Indian Oil Corporation recently bought one million barrels of Nigeria’s Agbami crude for September 2025 delivery in a tender awarded to global trader Trafigura.
Also included are one million barrels of Angola Girassol, one million barrels of US Mars, three million barrels of Abu Dhabi Murban, and two million barrels of Nigerian oil, according to Reuters.
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The report noted that the purchase is part of a broader sourcing spree that has seen Indian refiners secure millions of barrels from non-Russian sources post July 2025.
Meanwhile, Indian refiners secured purchases of Nigerian crude grades; the $20bn Dangote Petroleum Refinery in Ibeju-Lekki, Lagos, is relying on around 60 percent on US and other imoorts to feed its processing units.
Data showed that the refinery imported an average of 10 million barrels in July 2025, saying it was increasingly relying on the US for its feedstock despite the naira-for-crude deal with the Federal Government, which kicked off in October last year.
According to Reuters, the Indian Oil Corp and Bharat Petroleum have bought a million barrels of non-Russian crude billed for delivery in September and October after the US pressured India to halt purchases from Russia.
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Indian state refiners had been largely absent from the Nigerian crude market spotlight since 2022; they have in the past concentrated on Russian crude amid the Russian-Ukrainian war. However, the Indian refiners paused Russian purchases in late July 2025 after pressure from US President Donald Trump.
On the part of Dangote Refinery, data from commodities analytics firm Kpler showed that in July, US barrels accounted for about 60 percent of Dangote’s 590,000 barrels per day of crude intake, with Nigerian grades making up the remaining 40 percent.
In July, the Dangote refinery’s crude imports surged to a record 590 kbd—driven largely by US barrels overtaking Nigerian supply for the first time—amid ongoing domestic sourcing challenges, Kpler reports.
“While WTI has held a significant share in Dangote’s import slate since March, this is the first time US crude has overtaken Nigerian supply—a shift driven by several factors,” Kpler stated.
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