Nigeria’s oil palm production and processing capacity are expanding due to private sector investment, according to a report by the United States Department of Agriculture (USDA).
Strong domestic and international market demand and high prices were driving private sector investment, the USDA’s Foreign Agricultural Service (FAS) 26 April report said.
In its Nigeria Oilseeds and Products Annual, the USDA said it expected Nigeria’s palm oil production in the 2023/24 marketing year (January-December) to reach 1.1M tonnes, up by about 22% compared to its 2022/23 estimate of 900,000 tonnes.
Oil palm planted area in the current marketing year was forecast to reach 3.2M ha, up by 7% from the USDA’s 2022/23 estimate of 3M ha. The increase in harvested area was due to growing domestic demand for palm kernel oil in food processing and growing private sector investment in the sector, the report said.
Increased government intervention in allocating lands to investors for oil palm plantations has led to greater adoption of improved planting materials, good farming practices, and better harvesting techniques, according to the report. The USDA forecast average yields in the 2023/24 marketing year of 0.34 tonnes/ha.
Although Nigeria was the world’s fifth largest palm oil producer, it relied on imports to fill its supply gap, the USDA said.
Nigeria is expected to require 400,000 tonnes of palm oil supply to meet its demand in the 2023/24 marketing year, according to the report.
