Nigeria loses N340.6bn annually to shea butter smuggling

Shea butter is smuggled daily across the Nigerian border to Benin Republic

Government’s quest to diversify the country’s revenue earning sources from crude oil exports would be realised if it is able to claw back losses estimated at about $2.166 billion (about N340.6 billion) annually through smuggling of shea butter across Nigeria’s borders.

Nigeria, which exports about 50,000 tons of shea butter annually, is believed to account for almost 60 per cent of the world’s supply of shea butter and allied derivatives valued at about $3.8 billion every year.

But the Director General, Niger State Commodities and Export Promotion Agency, Mohammed Kontagora, said in Abuja on Wednesday that the country loses billions of naira every year to smuggling of the product. He said a minimum of 50 trailers conveying shea butter and its derivatives cross the Nigerian border daily to Benin Republic through Niger State’s borders alone, as the Nigeria Customs Service appears unable to curb the activities of the smugglers.

While appealing to the Customs to do more to stop the smuggling of shea products across the country’s borders, Mr. Kotangora, who was briefing reporters on preparations towards the 6th Annual Shea Industry conference planned for Abuja next year, said efforts should be made by stakeholders to create awareness on the potentials, opportunities and benefits from shea butter production.

“The shea butter industry is huge. Taking steps to develop the capacity for large-scale production of shea in Nigeria will put the country on the right path to diversifying the economy, considering the large market that exists for shea butter and its derivatives in Nigeria and other parts of the world. We can reap the maximum benefit of the international trade of the produce,” Mr. Kontagora said.

According to Mr. Kontagora, the Shea industry in Nigeria is on the path of growth, with potentials to mechanically process 6,000 SETs per year and export 50,000 tons per year. New processing plants are being constructed every year, while existing ones are being renovated to increase capacity and efficiency.

The President of Global Shea Alliance, GSA, Eugenia Akuete, noted that the forthcoming conference would provide opportunity for all stakeholders in the production and processing of Shea to interact, exchange information and network as well as develop mutually beneficial business connections to facilitate the growth of the local industry.

“Nigeria is in a unique position to benefit from the opportunity to showcase the gains made in the shea industry over the past eight years as the host of the Shea 2013. More than 15 million women across West Africa participate directly in the Shea industry. Therefore, for every $1 of Shea exported, local villages receive an additional 50 per cent of the income. Much of the gains made directly benefits the millions of rural women that collect shea nuts and produce handcrafted shea butter in their villages”, she said.

The world conference, which would have as its theme: “Global Perspectives” would provide the platform for discussions on the economic, social and environmental aspects of shea, particularly on sourcing logistics, quality regulation, processing innovations, business modelling, social accountability, sustainable marketing, cosmetics formulation, soap-making, and biodiversity.

The group, which is a multi-stakeholder association currently has 170 members from 35 countries representing every aspect of the shea value chain, including shea butter producers and exporters, wholesalers, retailers and brands.