Economy
Manufacturers Lament N1.24trn Unsold Finished Products in H1 2024
By Adedapo Adesanya
Local producers are not happy about the current economic situation in Nigeria as it is affecting their businesses, causing them to incur losses.
In the first half of 2024, the inventory of unsold finished products in the manufacturing sector surged by 357.57 per cent year-on-year to N1.24 trillion.
At the unveiling of its first half economic report on Monday in Lagos, the Manufacturers Association of Nigeria (MAN), through its chairman, Mr Francis Meshioye, the group called for the implementation of decisive and coherent economic reforms.
The association listed key areas of focus as enhancing policy consistency, improving the business environment, and fostering economic diversification.
The organisation said the high levels of unsold inventories reflect the challenges faced by consumers and the need for interventions to stimulate demand and improve the sector’s performance, adding that the reforms were needed to address the challenges being faced by manufacturers.
Mr Meshioye noted that the first half of 2024 was marked by significant challenges for Nigeria’s manufacturing sector, including high operational costs, declining consumer demand, and rising inflation, stressing that while some sectors showed resilience and growth, others struggled with declining production values, rising inventories, and reduced employment.
The group noted that the lingering impact of high interest rates, debt sustainability challenges, continuing geopolitical tensions and ever-worsening climate risks continued to pose challenges to growth in the sector, emphasising that this threatened decades of development gains, especially for developing and small island developing states.
The MAN report said in Nigeria’s manufacturing sector, capacity utilisation showed a slight year-on-year decline to 56.4 per cent in H1 2024 from 56.5 per cent in H1 2023.
It was revealed that there was a 2.8 per cent increase compared to H2 2023, reflecting some recovery.
“Real manufacturing output in Nigeria declined by 1.66 per cent year-on-year in H1 2024, falling to N1.34 trillion from N1.36 trillion in H1 2023.
“In spite of this decline, the sector saw a 9.97 per cent increase compared to H2 2023, driven by a baseline effect.
“In nominal terms, the manufacturing sector’s output in Nigeria increased by 30.38 per cent year-on-year, reaching N5.34 trillion in H1 2024.
“This growth was primarily driven by the sharp rise in domestic prices, as reflected in the Consumer Price Index (CPI), which surged to 34.19 per cent in June 2024,” MAN said.
Also, the manufacturing sector’s local raw material sourcing improved slightly to 56.03 per cent in H1 2024, up from 55.4 per cent in H1 2023.
According to the MAN president, the modest increase indicates a gradual shift towards local sourcing, driven by difficulties in obtaining foreign exchange.
He, however, noted that some sectors, such as non-metallic mineral products and textile, apparel & footwear, faced declines in local sourcing, reflecting the challenges of shifting away from imported raw materials.
Despite this, Mr Meshioye stated that investments in the manufacturing sector continued to rise, reaching N250.13 billion in H1 2024, a 29.63 per cent year-on-year increase.
By Dipo Olowookere
The Nigerian Exchange (NGX) Limited witnessed Santa Claus rally on Wednesday after it closed higher by 0.12 per cent.
Strong demand for Nigerian stocks lifted the All-Share Index (ASI) by 185.70 points during the pre-Christmas trading session to 153,539.83 points from 153,354.13 points.
In the same vein, the market capitalisation expanded at midweek by N118 billion to N97.890 trillion from the preceding day’s N97.772 trillion.
Investor sentiment on Customs Street remained bullish after closing with 36 appreciating equities and 22 depreciating equities, indicating a positive market breadth index.
Guinness Nigeria chalked up 9.98 per cent to trade at N318.60, Austin Laz improved by 9.97 per cent to N3.20, International Breweries expanded by 9.85 per cent to N14.50, Transcorp Hotels rose by 9.83 per cent to N170.90, and Aluminium Extrusion grew by 9.73 per cent to N16.35.
On the flip side, Legend Internet lost 9.26 per cent to close at N4.90, AXA Mansard shrank by 7.14 per cent to N13.00, Jaiz Bank declined by 5.45 per cent to N4.51, MTN Nigeria weakened by 5.21 per cent to N504.00, and NEM Insurance crashed by 4.74 per cent to N24.10.
Yesterday, a total of 1.8 billion shares valued at N30.1 billion exchanged hands in 19,372 deals versus the 677.4 billion shares worth N20.8 billion traded in 27,589 deals in the previous session, implying a slump in the number of deals by 29.78 per cent, and a surge in the trading volume and value by 165.72 per cent and 44.71 per cent apiece.
Abbey Mortgage Bank was the most active equity for the day after it sold 1.1 billion units worth N7.1 billion, Sterling Holdings traded 127.1 million units valued at N895.9 million, Custodian Investment exchanged 115.0 million units for N4.5 billion, First Holdco transacted 40.9 million units valued at N2.2 billion, and Access Holdings traded 38.2 million units worth N783.3 million.
By Adedapo Adesanya
Nigerian food and beverage company, Rite Foods Limited, has extended warm Yuletide greetings to Nigerians as families and communities worldwide come together to celebrate the Christmas season and usher in a new year filled with hope and renewed possibilities.
In a statement, Rite Foods encouraged consumers to savour these special occasions with its wide range of quality brands, including the 13 variants of Bigi Carbonated Soft Drinks, premium Bigi Table Water, Sosa Fruit Drink in its refreshing flavours, the Fearless Energy Drink, and its tasty sausage rolls — all produced in a world-class facility with modern technology and global best practices.
Speaking on the season, the Managing Director of Rite Foods Limited, Mr Seleem Adegunwa, said the company remains deeply committed to enriching the lives of consumers beyond refreshment. According to him, the Yuletide period underscores the values of generosity, unity, and gratitude, which resonate strongly with the company’s philosophy.
“Christmas is a season that reminds us of the importance of giving, togetherness, and gratitude. At Rite Foods, we are thankful for the continued trust of Nigerians in our brands. This season strengthens our resolve to consistently deliver quality products that bring joy to everyday moments while contributing positively to society,” Mr Adegunwa stated.
He noted that the company’s steady progress in brand acceptance, operational excellence, and responsible business practices reflects a culture of continuous improvement, innovation, and responsiveness to consumer needs. These efforts, he said, have further strengthened Rite Foods’ position as a proudly Nigerian brand with growing relevance and impact across the country.
Mr Adegunwa reaffirmed that Rite Foods will continue to invest in research and development, efficient production processes, and initiatives that support communities, while maintaining quality standards across its product portfolio.
“As the year comes to a close, Rite Foods Limited wishes Nigerians a joyful Christmas celebration and a prosperous New Year filled with peace, progress, and shared success.”
By Adedapo Adesanya
The Naira closed the pre-Christmas trading day positive after it gained N6.61 or 0.46 per cent against the US Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Wednesday, December 24, trading at N1,443.38/$1 compared with the previous day’s N1,449.99/$1.
Equally, the Naira appreciated against the Pound Sterling in the same market segment by N1.30 to close at N1,949.57/£1 versus Tuesday’s closing price of N1,956.03/£1 and gained N2.94 on the Euro to finish at N1,701.31/€1 compared with the preceding day’s N1,707.65/€1.
At the parallel market, the local currency maintained stability against the greenback yesterday at N1,485/$1 and also traded flat at the GTBank forex counter at N1,465/$1.
Further support came as the Central Bank of Nigeria (CBN) funded international payments with additional $150 million sales to banks and authorised dealers at the official window.
This helped eased pressure on the local currency, reflecting a steep increase in imports. Market participants saw a sequence of exchange rate swings amidst limited FX inflows.
Last week, the apex bank led the pack in terms of FX supply into the market as total inflows fell by about 50 per cent week on week from $1.46 billion in the previous week.
Foreign portfolio investors’ inflows ranked behind exporters and the CBN supply, but there was support from non-bank corporate Dollar volume.
As for the cryptocurrency market, it witnessed a slight recovery as tokens struggled to attract either risk-on enthusiasm or defensive flows.
The inertia follows a sharp reversal earlier in the quarter. A heavy selloff in October pulled Bitcoin and other coins down from record levels, leaving BTC roughly down by 30 per cent since that period and on track for its weakest quarterly performance since the second quarter of 2022. But on Wednesday, its value went up by 0.9 per cent to $87,727.35.
Further, Ripple (XRP) appreciated by 1.7 per cent to $1.87, Cardano (ADA) expanded by 1.2 per cent to $0.3602, Dogecoin (DOGE) grew by 1.1 per cent to $0.1282, Litecoin (LTC) also increased by 1.1 per cent to $76.57, Solana (SOL) soared by 1.0 per cent to $122.31, Binance Coin (BNB) rose by 0.6 per cent to $842.37, and Ethereum (ETH) added 0.3 per cent to finish at $2,938.83, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 each.
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