Economy
Nigerian Firm Gets $100m Loan for Fertilizer Production
By Dipo Olowookere
A credit facility worth $100 million has been given to Nigerian company known as Indorama Eleme Fertilizer and Chemicals Limited for the production of fertilizers in the country.
The loan was granted by the African Development Bank (AfDB) and is expected to address the problem of inadequate fertilizer utilization, which is considered one of the principal constraints to agricultural growth and development in Nigeria, and the entire African continent.
The firm is expected to use the loan to double its fertilizer production from 1.4 million tons of urea to 2.8 million tons per annum.
Business Post reports that the intervention of the AfDB follows a previous loan extended to Indorama Fertilizer in 2013 for the commissioning of another urea fertilizer plant with a production capacity of 1.4 million tons per annum.
The completion and exploitation of that plant in 2016 helped turn Nigeria from a net fertilizer importer to a self-sufficient producer, and now a net exporter of fertilizer.
In 2017, 700, 000 tons of urea were exported to West Africa and North and South American markets. Production from the new plant will predominantly target export markets.
The Indorama Eleme Complex has been a success story of public private partnerships in Nigeria, with several benefits including import substitution of raw materials to over 450 downstream industries; increased crop yields of over 30 percent; training of 200,000 farmers on the proper use of fertilizers expected to reach 2 million by 2021; creation of 50,000 jobs, and an annual contribution of $2 billion to Nigeria’s GDP.
The estimated $1.1 billion cost of the Project is to be financed with equity of $100 million and debt finance of $1billion which will be provided by development finance institutions.
Commenting on the loan, the Director for Industrial and Trade Development at AfDB, Abdu Mukhtar, stated that, “This Project will build upon the success of Train-I in increasing the domestic supply of urea fertilizer in Nigeria, making it easily available and leading to cheaper prices for the Nigerian farmer.”
“It will also help further address labor issues in a local region wracked by poverty, inequality and political tension by creating high paying technical jobs and will count towards climate change abatement by reducing amounts of flared gas,” Mukhtar added.
Fertilizer production support is well aligned with regional and national priorities, as well as the Bank’s assistance strategy in Nigeria, and is an important step towards the Bank’s goal of radically transforming Africa’s agriculture sector and making the continent self-sufficient in food.
Despite a large population of farmers, Nigeria spends at least $6 billion per year on food imports. A contributing factor to low domestic crop yields is low consumption levels of fertilizer in Nigeria-and indeed Africa as a whole, which averages only 10-15% of global levels.
The project supports the medium term economic recovery and growth plan of the Government of Nigeria and the Bank’s regional strategy to link regional markets in West Africa. 20% of the urea exports will be made to South Africa and West Africa (Cote D’Ivoire & Senegal). Regional integration will be further strengthened by the export of increased agriculture production in Nigeria.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange receded by 0.30 per cent on Tuesday, January 20 following sell-offs in five stocks on the unlisted stock trading platform.
The price losers were led by FrieslandCampina Wamco Nigeria Plc, which gave up N1.71 to sell at N72.00 per share compared with the N73.71 per share it traded a day earlier.
Further, Central Securities Clearing System (CSCS) Plc dropped 37 Kobo to close at N41.43 per unit versus Monday’s closing price of N41.80 per unit, Ge0-Fluids Plc lost 14 Kobo to trade at N7.00 per share compared with the previous day’s N7.14 per share, Afriland Properties Plc depreciated by 13 Kobo to trade at N14.60 per unit versus the N14.73 per unit it was exchanged a dy earlier, and UBN Property Plc declined by 11 Kobo to quote at N1.90 per share, in contrast to the preceding session’s N2.01 per share.
As a result, the market capitalisation went down by N6.5 billion to N2.187 trillion from N2.194 trillion, while the NASD Unlisted Security Index (NSI) depreciated by 10.86 points to 3,656.36 points from 3,667.22 points.
Business Post reports that yesterday, there was a price gainer, which was IPWA Plc. It gained 16 Kobo to end at N1.79 per unit versus N1.63 per unit.
During the trading day, the total value of transaction jumped by 137.5 per cent to N43.3 million from N18.2 million, while the volume of transactions decreased by 3.2 per cent to 2.6 million units from 2.7 million units, as the number of deals depreciated by 30.2 per cent to 30 deals from 43 deals.
At the close of trades, CSCS Plc was the most active stock by value on a year-to-date basis with 3.6 million units worth N145.6 million, trailed by MRS Oil Plc with 278.971 units valued at N55.7 million, and Geo-Fluids Plc with 7.6 million units sold for N51.9 million.
Geo-Fluids Plc maintained its position as the most active stock by volume on a year-to-date basis with 7.6 million units traded for N51.9 million, followed by CSCS Plc with 3.6 million units transacted for N145.6 million, and Industrial and General Insurance (IGI) Plc with 3.1 million units valued at N1.9 million.
By Adedapo Adesanya
The Naira rebounded on Tuesday, January 20 in the Nigerian Autonomous Foreign Exchange Market (NAFEM) as it appreciated against the US Dollar by 93 Kobo or 0.06 per cent to N1,419.35/$1 from Monday’s N1,420.28/$1.
However, it depreciated against the Pound Sterling in the official market by N2.43 to trade at N1,908.31/£1 versus the previous day’s N1,905.88/£1 and lost N13.53 against the Euro to finish at N1,666.31/€1 compared with the preceding session’s closing price of N1,652.78/€1.
The Nigerian currency also weakened against the Dollar at the GTBank forex counter yesterday by N5 to sell at N1,429/$1, in contrast to Monday’s exchange rate of N1,424/$1 and maintained stability at the parallel market at N1,485/$1.
Market analysts said they expect the current trading range of the Naira to remain firm in the near term supported by stronger foreign inflows driven by higher oil receipts, improved FPI participation, and consistent FX management by the Central Bank of Nigeria (CBN).
Boost from exporters’ and importers’ inflows in addition to non-bank corporate supply will also help enhance liquidity.
The Dollar also faced pressure in the international market in the midst of a dispute between the US and its European allies over Greenland, which President Donald Trump said “no going back” on his campaign thereby triggering selloffs to other safe haven assets.
As for the cryptocurrency market, Bitcoin (BTC) dropped below $90,000 on Tuesday amid a sharp shift in global risk sentiment, triggering more than $1 billion in forced liquidations of leveraged crypto positions.
The crypto sell-off coincided with broader market jitters tied to renewed tariff threats from President Donald Trump and a sell-off in Japanese government bonds that pushed global yields higher and pressured risk assets, with the BTC down by 1.6 per cent to $89,456.08.
Ethereum (ETH) lost 4.7 per cent to trade at $2,974.67, Binance Coin (BNB) slumped by 4.1 per cent to $878.27, Solana (SOL) depreciated by 2.8 per cent to $128.14, Cardano (ADA) crashed by 1.9 per cent to $0.3595, Ripple (XRP) slipped by 1.8 per cent to $1.91, Litecoin (LTC) declined by 1.7 per cent to $68.92, and Dogecoin (DOGE) shrank by 1.5 per cent to $0.1251.
On the flip side, the US Dollar Tether (USDT) appreciated by 0.01 per cent to trade at $1.00, and the US Dollar Coin (USDC) gained 0.03 per cent to settle at $1.00.
By Dipo Olowookere
The Nigerian Exchange (NGX) Limited returned to green territory on Tuesday after it chalked up 0.09 per cent on the back of renewed buying pressure.
The market regained strength yesterday despite profit-taking in the banking space, which caused its index to close lower by 0.69 per cent.
Business Post reports that insurance counter was up by 2.80 per cent, the energy sector appreciated by 2.40 per cent, the commodity segment grew by 1.22 per cent, and the consumer goods industry improved by 0.03 per cent, while the industrial goods counter closed flat.
At the close of transactions, the All-Share Index (ASI) went up by 144.32 points to 166,256.82 points from 166,112.50 points and the market capitalisation gained N93 billion to finish at N106.436 trillion compared with the N106.343 trillion it settled on Monday.
During the session, investors transacted 795.5 million equities valued at N20.0 billion in 45,410 deals versus the 629.6 million equities worth N14.8 billion executed in 57,858 deals a day earlier, indicating a rise in the trading volume and value by 26.35 per cent and 35.14 per cent apiece and a decline in the number of deals by 21.52 per cent.
Tantalizers was the busiest stock yesterday with a turnover of 87.0 million units valued at N300.9 million, Secure Electronic Technology traded 74.2 million units worth N87.6 million, a new member of the NGX, Zichis Agro Allied Industries, transacted 69.6 million units for N138.5 million, Zenith Bank sold 49.1 million units valued at N3.5 billion, and GTCO exchanged 39.1 million units worth N3.8 billion.
On Tuesday, the market breadth index was positive after Customs Street ended with 39 appreciating shares and 25 depreciating shares, representing a bullish investor sentiment.
Deap Capital, NPF Microfinance Bank, and Red Star Express gained 10.00 per cent each to sell for N5.39, N4.73, and N15.95 apiece, as NCR Nigeria soared by 9.97 per cent to N155.50, and Morison Industries also increased by 9.97 per cent to N6.84.
Conversely, Aluminium Extrusion lost 9.95 per cent to settle at N17.20, Jaiz Bank declined by 9.88 per cent to N7.21, FTN Cocoa shrank by 8.44 per cent to N7.05, UPDC decreased by 8.06 per cent to N5.70, and Caverton slumped by 5.59 per cent to N7.60.
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