Crude palm oil imports soar 487% on rising demand

Nigeria’s crude palm oil imports soared during January to June 2026. The country spent N91.62bn, compared with N15.61bn in the same period of 2025. This matters because the increase signals a widening gap between what Nigerian producers supply and what households and industries need.

The rise accelerated across both quarters. Imports climbed from N7.87bn to N23.16bn in the first quarter, comparing 2025 with 2026. In the second quarter, they jumped from N7.74bn to N68.46bn. The second-quarter increase accounted for most of the six-month import bill.

Industry operators estimate Nigeria has a supply deficit of about 1.5 million tonnes. Tunde Banjoko of the Lagos Chamber of Commerce and Industry said imports are not a lasting solution. He called for investment in plantations, including regeneration of ageing trees, and expansion of local production.

Nigeria’s crude palm oil import bill rose by 486.94 per cent year-on-year in the first half of 2026. Spending reached N91.62bn, compared with N15.61bn in the first half of 2025. The figures show an unusually rapid expansion in foreign purchases within just one year.

The quarterly breakdown reveals where the increase occurred. First-quarter imports rose from N7.87bn in 2025 to N23.16bn in 2026. Second-quarter imports then surged from N7.74bn to N68.46bn. That second-quarter jump was much larger and drove most of the half-year increase.

The scale reflects Nigeria’s struggle to match domestic supply with demand. Industry operators estimate a shortfall of about 1.5 million tonnes. Tunde Banjoko warned that imports may fill an immediate need, but they do not fix production weaknesses. He urged investment in ageing plantations, existing producers, and new facilities to reduce future dependence.

Crude palm oil is oil pressed or extracted from the fruit of oil palm trees before refining and other processing. It is a basic agricultural input rather than a finished consumer product. Its importance comes from the many goods that can be made from it, including edible oils, processed foods, soaps, detergents, cosmetics, and some industrial materials.

The article does not list specific industries, but it repeatedly refers to domestic and industrial demand. In practice, manufacturers buy crude palm oil as a feedstock. They refine it, blend it, or transform parts of it into ingredients for consumer and industrial products. When local supply falls short, companies may turn to imported oil to keep production running.

Nigeria’s import surge therefore reflects more than household consumption. The country spent N91.62bn on crude palm oil imports in the first half of 2026. That spending highlights the pressure placed on manufacturers by a reported supply deficit of about 1.5 million tonnes.

Nigeria has palm oil plantations and major producers, but their output remains below national demand. Industry operators estimate a deficit of about 1.5 million tonnes. That shortage leaves manufacturers and other buyers dependent on overseas suppliers, even while domestic plantations continue operating.

The article identifies ageing plantations as a central problem. Some established plantations need regeneration before they can produce more effectively. Banjoko also called for support for existing producers, including Okomu Oil Palm Company, Presco Plc, and smaller operators. Expanding facilities and improving old plantations could increase local supply over time.

Imports provide access to oil when domestic production is insufficient, but they do not remove the underlying capacity gap. Nigeria’s import bill reached N91.62bn in the first half of 2026. The article warns that relying on imports may discourage investment, making it harder for local producers to expand and compete.

Industry operators estimate that Nigeria is short of about 1.5 million tonnes of palm oil. The article presents this as a supply deficit against the country’s domestic and industrial needs. It does not provide a separate total figure for national demand, so the exact percentage shortfall cannot be calculated from the available data.

The deficit helps explain the dramatic import increase. Nigeria spent N91.62bn on crude palm oil imports during the first half of 2026, compared with N15.61bn a year earlier. Imports rose in both quarters, with second-quarter spending reaching N68.46bn. Foreign supplies are therefore helping cover demand that local producers cannot currently meet.

Tunde Banjoko said the gap should be addressed through investment rather than imports alone. He pointed to ageing plantations, regeneration, new production facilities, and support for existing producers. Without stronger output, Nigeria may remain exposed to import dependence as demand continues to rise.

If imports keep rising, Nigerian farmers and producers could face tougher competition from foreign suppliers. Banjoko warned that imported palm oil may discourage investment in local production. That matters because plantations, processing facilities, and small producers need investment to expand output and close the supply gap.

The article’s key mechanism is a damaging cycle. Imports help meet immediate demand, but they can reduce the incentive to finance domestic plantations. If local producers cannot compete, ageing plantations may remain unproductive, while new facilities are delayed. The country would then need more foreign oil to cover the same shortage.

The current figures show why the concern is serious. Nigeria’s first-half import bill rose to N91.62bn in 2026, while the estimated supply deficit stood near 1.5 million tonnes. Banjoko called for plantation regeneration, support for producers, and investment in new capacity. Those steps could improve self-sufficiency and strengthen the local industry.

A country becomes self-sufficient when local farms and processors can reliably meet demand without depending heavily on imports. In palm oil, plantation age and yield are crucial. Older plantations may produce less, reducing the volume available to factories and consumers. Low output then widens the supply gap and increases import needs.

The economics work through expected returns. Investors are more likely to fund regeneration, new plantations, and processing facilities when higher yields and reliable demand can cover costs. But cheap or abundant imports can make local production less competitive. That may reduce investment, leaving old plantations in place and keeping yields low. This creates a difficult cycle.

Nigeria’s experience reflects that challenge. Imports reached N91.62bn in the first half of 2026, while operators estimated a 1.5-million-tonne deficit. Banjoko called for investment in ageing plantations, existing producers, and new facilities. Those measures could raise domestic output and support self-sufficiency over time.