Posted on May, 14, 2019 at 10:24 am
By Arvin Donley - WORLD-GRAIN.COM
LAGOS, NIGERIA – As Nigerians increasingly shift to consuming greater amounts of wheat flour-based products, the country is forecast to increase wheat imports in 2019-20 by 4%, according to a May 10 Global Agricultural Information report from the U.S. Department of Agriculture (USDA).
USDA said the rise in consumption is attributable to population growth of 2.5% annually in Nigeria, whose population accounts for nearly half of that in West Africa.
Wheat production in 2019-20 in Nigeria is projected to reach 60,000 tonnes, unchanged from the previous year’s production number, USDA said, while wheat imports are forecast at 5.6 million tonnes.
“Flour millers favor imports, indicating that local wheat has a higher protein content, lower moisture, lower gluten,” USDA said. “Despite Nigerian millers’ preference for imported wheat, the government is aiming to reduce wheat imports by 50%. To reduce imports, the government is requiring millers to purchase local wheat at a fixed price of $400 per tonne.”
Russia, the U.S., Canada and Australia supply the bulk of Nigeria’s wheat imports destined for milling, USDA said, noting that the market share for U.S.-origin wheat has been declining over the past decade due to increasing competition from the other three countries.
Flour Mills of Nigeria is the country’s largest flour miller and other major players include Dangote, Honeywell, Olam, and Seaboard Group.
Olam recently submitted a binding offer to acquire 100% equity ownership of Dangote. The proposed transaction would include DFM’s five facilities engaged in flour and pasta manufacturing, as well as its logistics capabilities, including access to the ports of Apapa and Calabar. DFM’s mills are located in strategic positions across Nigeria.
Source: WORLD-GRAIN.COM