Economy
High Transport Cost Affects 85% Agribusinesses Revenue in Nigeria—Survey
By Adedapo Adesanya
The high cost of transport has been identified as the leading cause of the decline in revenues of small and medium-sized agricultural enterprises in Nigeria, accounting for 85 per cent.
AGRA, an African-led and Africa-based institution dedicated to placing smallholder farmers, made this disclosure in the 3rd edition of the African Agribusiness Outlook Report which sheds light on the impact of the Triple Crisis of the COVID-19 pandemic, climate change, and the Russia-Ukraine conflict, on small and medium-sized agribusinesses in Nigeria, Zambia, and Tanzania.
The report, which is jointly produced by AGRA and IPSOS, surveyed 1,623 small and agribusinesses in the rice, maize, and tomato value chains in the three counties, and the soybean, maize, and tomato value chains in Zambia.
The past three years have presented huge shocks across multiple sectors.
First, COVID-19 created disruptions across all levels of the supply chains, then two years later as actors started to recover, the Russia-Ukraine crisis surfaced new shocks and disruptions to global supply chains and oil supply, which continue to be felt today. At the same time, there have been the unprecedented effects of climate change that are recording significant negative impacts on productivity downstream.
Agribusinesses in agricultural value chains in Nigeria, Tanzania, and Zambia, have been hard hit by the triple crisis. Although the larger businesses were hardest hit in Nigeria and Zambia in 2020, these businesses appear to have been better able to recover as of 2023.
While supply, demand, and operational costs were significant challenges during the peak of the COVID-19 pandemic, the report reveals that businesses continue to grapple with soaring operational expenses in the wake of climate-related impacts and the ongoing conflict in Ukraine.
The report disclosed that 58 per cent of SMEs surveyed have experienced substantial revenue declines of 20 per cent or more throughout the “triple crisis” period.
It found that 51 per cent of Nigerian agric SMEs reported a decline in revenue since the 2019 COVID-19 outbreak with the high cost of transport identified as a leading cause of the drop.
Maize was the hardest-hit crop in 2020 in the country with medium-sized businesses affected the most but recovered faster than smaller businesses.
Other areas of the survey showed that 42 per cent of SMEs in Nigeria injected more capital into their businesses, 36 per cent reduced staff as part of cost-cutting measures, and while loan uptake grew over the past few years, only 12 per cent of Nigerian SMEs took out loans to cope with the crisis, citing perceived affordability as a barrier.
Mrs Agnes Kalibata, President of AGRA, noted that Agribusinesses have exhibited remarkable adaptability, innovation, and determination, on the one hand, but continue to struggle amidst business disruptions through lockdowns, supply chain disruptions, productivity decreases, and reduced consumer demand.
“There is an urgent need for measures to effectively address and alleviate the impacts of these crises on the sector that serves as the primary employer, engaging over 70 per cent of Africa’s population in economic activities and contributing more than 30 per cent to the continent’s economies,” she said.
By Adedapo Adesanya
The Minister of Finance, Mr Wale Edun, says Nigeria’s crude oil production has risen to 1.8 million barrels a day, contrasting with available production data.
Speaking in an interview with Reuters on Wednesday on the sidelines of the International Monetary Fund and World Bank Group spring meetings in Washington D.C., the Minister said the current oil output would generate fiscal breathing space that will allow the government to support vulnerable households as it ploughs ahead with reforms.
Nigeria, which is a member of the Organisation of the Petroleum Exporting Countries (OPEC), is Africa’s largest oil producer.
Mr Edun said rising crude production was positive for Nigeria’s revenue, foreign exchange and the country’s fiscal situation.
“It gives us that extra fiscal space within which to look at … helping the vulnerable households at this time,” he told the publication, noting that support would be targeted, adding “there is no thought of any return or retardation to broad untargeted subsidies.”
Mr Edun also said the Bola Tinubu-led administration was also committed to continuing its reform programme.
“Nigeria is in a position where the resilience that has been built in the economy is actually very obvious for all to see,” he said.
Despite the 1.8 million barrels per day figure claim, Business Post reports that production data for March 2026 from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) shows that Nigeria attained 1.546 million barrels per day, made up of 1.382 million barrels per day of crude, 42,809 barrels per day of blended condensate and 120,442 barrels per day of unblended condensate.
The average crude production represents 92 per cent of the OPEC quota, which is fixed at 1.5 million barrels per day.
By Adedapo Adesanya
The Securities and Exchange Commission Nigeria (SEC) has unveiled a new regulatory framework that would allow companies operating within free trade zones to raise capital from the Nigerian public, subject to strict eligibility and disclosure requirements.
The proposal, titled New Rules for Public Offering of Securities by a Free Trade Zone Entity, is anchored on provisions of the Investments and Securities Act (ISA) 2025 and is designed to integrate free trade zone enterprises into the domestic capital market while strengthening investor protection.
Under the proposed rules, only entities duly licensed by recognised free zone authorities, such as the Nigeria Export Processing Zones Authority and the Oil and Gas Free Zones Authority, will be eligible to issue shares to the public.
The commission clarified that the rules will apply strictly to free trade zone entities (FTZEs), excluding companies operating outside designated zones, even if licensed by zone authorities. It also emphasised that no FTZE will be permitted to offer securities to the public without prior approval from the Commission.
To qualify, an FTZE must demonstrate a minimum of three years’ operating track record immediately preceding its application, with at least two years of independent business activity within a free trade zone. Additionally, such entities are required to have competent senior management and a minimum paid-up share capital of not less than N7.5 billion.
The SEC said FTZEs seeking to access the capital market must subject themselves to Nigeria’s tax laws and comply fully with ongoing disclosure and reporting obligations applicable to publicly listed companies.
The proposed framework also outlines extensive registration requirements. Issuers will be required to submit evidence of licensing by a free zone authority, constitutional documents, and verified details of shareholding structure and board composition.
A “No Objection” letter from the relevant free zone authority will also be mandatory, alongside a commitment to list the offered shares on a registered securities exchange.
The SEC noted that the rules are intended to provide clarity on eligibility criteria and operational conditions for FTZEs seeking to conduct public offerings, thereby deepening the capital market and aligning free zone operations with national financial system standards.
By Aduragbemi Omiyale
Shareholders of Guinness Nigeria Plc will share about N4.38 billion as an interim dividend for the first quarter of 2026, the board has disclosed.
This cash reward amounts to N2.00 per share, as the company has shares outstanding of 2,190,382,819 on the floor of the Nigerian Exchange (NGX) Limited.
The brewer stated that the interim dividend would be paid to investors whose names appear on the register of members as of the close of business on April 20, 2026.
The dividend payout is being proposed following the sustained profitability reflected in the unaudited financial results of the company in the first three months of this year and its “strong performance in FY 2025.”
It would be “paid from distributable profits in accordance with Sections 426–428 of the Companies and Allied Matters Act (CAMA) 2020.”
Analysis of the performance of the brewery giant between January and March 2026 showed that revenue grew by 4 per cent on a year-on-year basis to N122.77 billion from N118.34 billion in the same period of last year, while the gross profit contracted to N43.48 billion from N44.52 billion due to prevailing cost pressures within the operating environment.
The company’s operating profit also shrank to N17.18 billion from N18.00 billion in the first quarter of 2025 due to elevated marketing & distribution costs and administrative expenses.
However, the reduction in net finance costs to N1.43 billion from N7.72 billion in Q1 of 2025 helped the organisation to grow its post-tax profit to N10.39 billion in the period under review versus the N7.03 billion recorded in the corresponding period of last year.
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