Nigeria is spending about $600 million annually importing palm oil and its derivatives despite its vast production potential and favourable climate for oil palm cultivation, an industry stakeholder, Lawal Olusola Lawal, has disclosed.
Lawal described the situation as a major reversal of Nigeria’s fortunes in the oil palm industry, warning that the country’s growing dependence on imports for a commodity it once supplied to international markets reflects years of neglect and inadequate investment.
Speaking at the unveiling of his book, “Trade Protectionism Disguised as Climate Advocacy: Why Europe is Demonizing the Oil Palm Tree,” Lawal said Nigeria had lost much of its competitive advantage in the global oil palm industry despite its historical dominance in the sector.
He said Nigeria currently produces only about half of the palm oil required to meet domestic demand, leaving a significant supply gap that is increasingly being filled through imports.
“It is very disheartening that the commodity we used to sell to others is what we are now importing back into the country to augment our local production,” he said.
According to him, Nigeria’s palm oil and related products import bill reached about $600 million in 2025, resulting in substantial foreign exchange outflows that could have been retained within the economy through increased local production and value addition.
Lawal said the challenge extends beyond crude palm oil, noting that Nigeria also depends heavily on imported industrial derivatives used by local manufacturers.
“About 100 per cent of the industrial derivatives used in industries, including the production of creamers, noodles and other products, are not being produced in Nigeria,” he said.
He attributed the country’s heavy import dependence largely to the failure to develop the oil palm sector as a fully integrated value chain.
According to him, oil palm should no longer be viewed merely as a source of cooking oil, but as a strategic industrial resource capable of supporting a wide range of manufacturing activities and creating employment across multiple sectors.
Lawal said the crop offers opportunities in food processing, cosmetics, manufacturing, machinery production and waste recycling, while its by-products could also be converted into commercially valuable materials.
“If we have a working industry, you have people working in the production of machinery, people collecting waste materials and turning them into other products,” he said.
He pointed to Indonesia and Malaysia as examples of countries that have transformed their oil palm industries into major engines of employment, rural development and foreign exchange earnings.
According to Lawal, sustained investment and strategic policy support enabled both countries to leverage their oil palm resources to create millions of jobs and generate significant export revenues.
The stakeholder, who previously authored “How to Build Generational Wealth Through Oil Farming in Nigeria,” said the global palm oil market is valued at about $300 billion, stressing that Nigeria should be positioning itself to capture a significant share of the market rather than spending scarce foreign exchange on imports.
He also disclosed that Nigeria imports palm oil from neighbouring countries, further highlighting the scale of the country’s production deficit despite its favourable climate, available land and long history of oil palm cultivation.
Asked where Nigeria went wrong, Lawal gave a blunt assessment: “One of the ways we got it wrong is negligence.”
He called for renewed investment in plantations, improved seedlings, modern processing facilities, affordable financing, research and development, as well as policies capable of attracting sustained private-sector investment.
Lawal further urged policymakers to treat oil palm as an integrated industrial value chain rather than simply an agricultural commodity.
He argued that reviving the sector could significantly reduce Nigeria’s import bill, conserve foreign exchange, create millions of jobs and restore the country’s position in the global export market.
For Nigeria, which once played a prominent role in the international oil palm trade, the shift from exporting palm oil to importing it from neighbouring countries has become a symbol of the broader challenges confronting the country’s agricultural and manufacturing sectors.
Lawal maintained that Nigeria could still reverse the trend, but warned that doing so would require sustained investment, coherent policies and a deliberate end to the years of neglect that allowed other countries to transform oil palm into a major economic engine.
