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NEXIM Bank, Bauchi To Boost Non-oil Sectors

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By Modupe Gbadeyanka

Governor Mohammed Abdullahi Abubakar of Bauchi State has disclosed that the state was collaborating with NEXIM Bank to improve the non-oil sectors.

According to Mr Abubakar, the state government and the bank is looking at how to explore opportunities in export-oriented investments in agro-processing, solid minerals and solid minerals.

He further disclosed that both parties are brainstorming on how to utilise the N500billion Export Stimulation Facility (ESF) and the N50 billion Export Rediscounting and Refinancing Facility (ERRF).

In order to make this achievable, the Acting Chief Executive Officer of NEXIM Bank, Mr Bashir Wali, met with the Governor recently to study the state’s resources.

Mr Abubakar told his guest that Bauchi State covers a total land area of 49,259.01 square kilometres which represents about 5.3 per cent of Nigeria’s total land mass, making it one of the largest states in the country.

The Governor explained further that agriculture is the mainstay of over 80 per cent of people who reside in both urban and rural areas with products ranging from maize, rice, millet, groundnut and guinea corn.

Additionally, cattle and other livestock are reared at a commercially viable level.

In terms of solid minerals, the governor indicated that the state has commercial mineral reserves comprising of Amethyst, Gypsum, Lead/Zinc, Uranium, Limestone, Kaolin, Gypsum, Antimony, Iron Ore, Gold, Marble, Columbite and zinc, precious stones like Sulphur, Amities and Aquamarine among others.

In addition to this, Bauchi has a manufacturing sector covering Iron and Steel, Water, Ceramics, Food and Beverages etc.

According to Mr Abubakar, Bauch State has not been able to explore its mineral resources due to licensing issues, considering that solid minerals is on the exclusive list.

He also stated that the paucity of data in terms of certification of available deposits; and the need to efficiently organise artisanal mining as well as establish beneficiation centres to boost the solid mineral value-chain in the State are other problems facing the state.

In his remarks, Mr Wali told the Governor that the bank would look at how to assist the state.

Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan. Mr Olowookere can be reached via dipo.olowookere@businesspost.ng

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Economy

Value of Naira Falls at P2P, I&E, Parallel Market Forex Scarcity Worsens

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By Adedapo Adesanya

The Naira further weakened against the United States Dollar in the various segments of the foreign exchange (forex) as the scarcity of hard currencies is getting worse, putting pressure on the local currency.

In the Peer-to-Peer (P2P) segment, the Nigerian currency was battered by the Dollar by N6 or 0.87 per cent to settle at N696/$1 versus the previous day’s value of N690/$1 and in the Investors and Exporters (I&E) window, the domestic currency fell by N1.50 or 0.29 per cent to trade at N430.25/$1 in contrast to Wednesday’s value of N428.75/$1 as the turnover for the session stood at $58.37 million.

Also, in the parallel market, the Naira depreciated by N8 or N1.19 per cent to quote at N680/$1 compared with the previous day’s value of N672/$1 and in the interbank segment, the domestic currency lost N5.51 against the Pound Sterling to sell for N513.10/£1 in contrast to N507.59£1 and against the Euro, the Nigerian currency went down by N4.7 to close at N433.78/€1 versus the N429.08/€1 it was sold a day earlier.

In the cryptocurrency market, the bears maintained their grip as nine of the 10 tokens tracked by Business Post pointed south, with Solana (SOL) losing 4.1 per cent to sell at $42.94.

Cardano (ADA) recorded a 2.9 per cent fall to sell at $0.5288, Binance Coin (BNB) recorded a 2.9 per cent depreciation to trade at $323.25, TerraClassicUSD (USTC) retreated by 2.7 per cent to quote at $0.0292, Bitcoin (BTC) fell by 2.5 per cent to sell at $23,939.78, Ripple (XRP) recorded a 1.2 per cent loss to trade at $0.3769, Dogecoin (DOGE) depreciated by 1.7 per cent to trade at $0.0708, Litecoin (LTC) lost 0.9 per cent to settle at $61.68, while Ethereum (ETH) declined by 0.1 per cent to sell at $1,888.23.

However, the value of the US Dollar Tether (USDT) remained unchanged yesterday at $1.00.

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Economy

Crude Oil Jumps 2% as IEA Forecast 2022 Demand Growth

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By Adedapo Adesanya

Prices of crude oil expanded by more than $2 on Thursday after the International Energy Agency (IEA) raised its demand growth forecast for this year.

Brent crude futures gained $2.20 or 2.3 per cent to settle at $99.60 a barrel while the United States West Texas Intermediate (WTI) crude futures rose by $2.41 or 2.6 per cent to $94.34 per barrel.

Global crude oil demand will rise by 2.1 million barrels per day this year, the IEA said in the latest monthly edition of its flagship Oil Market Report, spurred by the switch from gas to oil for electricity generation.

The new number is 380,000 barrels per day higher than the previous monthly forecast. It also means that the IEA now expects global oil demand this year to average 99.7 million barrels daily.

Supply, according to the IEA, already exceeds demand, as it hit 100.5 million barrels per day last month, with production from the Organisation of the Petroleum Exporting Countries and allies (OPEC+) adding 530,000 barrels per day in line with the production increase deal and non-OPEC+ output rising by 870,000 barrels per day.

“With several regions experiencing blazing heatwaves, the latest data confirm increased oil burn in power generation, especially in Europe and the Middle East but also across Asia,” the International Energy Agency said in its report. “Fuel switching is also taking place in European industry, including refining,” it said.

The agency also revised upwards its forecast for oil supply for the full year, noting a smaller than expected decline in Russian oil production and exports.

By contrast, OPEC cut its 2022 forecast for growth in world oil demand, citing the impact of Russia’s invasion of Ukraine, high inflation, and efforts to contain the pandemic.

OPEC expects 2022 oil demand to rise by 3.1 million barrels per day, down 260,000 barrels per day from the previous forecast. It still sees a higher overall global oil demand figure than the IEA for 2022.

OPEC+, however, is not eager to tap into this effective spare capacity, which would diminish the group’s power to respond to market emergencies with increased production.

After OPEC+’s last meeting in early August, OPEC+ referred to its “severely limited” spare capacity, which should be used with “great caution in response to severe supply disruptions”, reinforcing the IEA’s predictions that additional OPEC+ output increases are unlikely in the coming months.

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Economy

Treasury Bills Rates Rise Across Tenors at Primary Market

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Treasury Bills CBN Sold

By Dipo Olowookere

The Central Bank of Nigeria (CBN) offered treasury bills to investors at attractive rates at the primary market auction (PMA) on Wednesday as the government intends to use the avenue to borrow more money from the local debt market.

The stop rates were increased by the apex bank across the three maturities offered for sale during the session, with the shortest end of the curve witnessing the highest jump.

According to an analysis of the sales, the 91-day bill cleared at 3.50 per cent, 0.70 per cent higher than the previous session’s stop rate of 2.80 per cent. The 182-day tenor was sold to traders at 4.50 per cent, 0.40 per cent higher than the 4.10 per cent offered at the preceding PMA, while the 364-day maturity cleared at 7.45 per cent, 0.45 per cent higher than the 7.00 per cent of the earlier exercise.

Business Post reports that the CBN, which auctioned the debt instruments for the Debt Management Office (DMO) on behalf of the federal government of Nigeria, offered for sale N150.62 billion worth of the T-Bills and it received subscriptions valued at N187.53 billion, with an allotment of N150.62 billion made at the end of the exercise.

A breakdown showed that N1.02 billion worth of the three-month bill was auctioned by the central bank but bids worth N1.80 billion were received and N1.15 billion issued to subscribers, with the range of bid rates between 2.70 per cent and 10.00 per cent.

As for the six-month instrument, N1.82 billion was taken to the market but the appetite for this maturity was low as subscriptions worth N1.69 billion were processed between 4.10 per cent and 7.00 per cent, but the apex bank sold N1.3 billion at 4.5 per cent.

It was observed that the strong demand for higher tenors, ostensibly because of the higher rates, continued during the exercise for the 12-month bill. The CBN approached the market with N147.78 billion worth of the instrument but the demand rose to N184.04 billion, with investors bidding between 6.00 per cent and 12.00 per cent. However, the bank issued N148.15 billion at 7.45 per cent.

This trend is expected to continue at the next PMA as investors shop for investment tools that will fetch them higher yields amid rising inflationary pressures eroding the gains from risk-free assets.

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