Shea Nut Export Ban is a Right Move Done Wrongly —Exporter

News In Brief

-A Nigerian Shea nuts stakeholder reacts to the extension of the ban on export of raw shea nuts, calling it a right move at the wrong time.

-She details how the abrupt ban halted operations mid-season, leaving over 100 trucks of nuts at ports and causing serious economic challenges for everyone in the shea nut value chain.

A stakeholder in the shea nut industry has reacted to the recently announced extension of the ban on the exports of raw shea nuts by the federal government of Nigeria, calling it a right move done wrongly.

Speaking to The Junction in an exclusive interview, Elizabeth Olanrewaju Nwankwo, CEO of Oklan Best Limited and Director of Sustainability and Climate Adaptation for NASPAM (National Shea Products Association of Nigeria), opened up about the complexities surrounding Nigeria's shea nut export ban and its devastating impact on the sector.

Elizabeth, who participates at several levels of the shea nut value chain, from picking, aggregating and exporting nuts and small-scale processing of nuts, explained that while she welcomes the government's decision to ban raw shea nut exports as a way to promote local processing and value addition, she argues that the execution has been catastrophic for industry stakeholders.

Long Overdue, Poorly Executed

According to Elizabeth, the leadership of the shea industry has been advocating for this ban for years. She recalls her multiple engagements with government officials dating back to 2016, including meetings with the former Vice President, Professor Yemi Osinbajo, in Abuja, and subsequent discussions in 2017 and 2019 with various government representatives and the late Oyo State Governor, Abiola Ajimobi, advocating for changes in the sector. Yet, when the ban finally came on August 26th, it arrived without warning or consultation.

"The ban is welcomed. That's the truth. But the way it was done is what we are after," Elizabeth said, noting that the timing could not have been worse. 

She explained how the ban had landed at the peak of the harvest season when stakeholders had already invested heavily in procurement. According to her, people had invested over a billion naira, with some individuals investing nearly ₦10 billion borrowed from financial institutions like the Nigerian Export-Import Bank (NEXIM) and Sterling Bank. Some stakeholders relied on family loans and supplier credit to finance their investments.

The losses these parties have incurred due to the ban have been huge, with more than 100 trucks, each carrying 30-60 tons of shea nuts, left stranded at ports and warehouses.

The Ripple Effect

What many reports fail to capture is the human cost of the ban. Nwankwo paints a vivid picture of the consequences that extended far beyond exporters and processors. When aggregators and exporters stopped operations, funding to women pickers in villages dried up immediately, for example. These women, who form the backbone of the shea value chain, suddenly had no buyers for their products and no access to the credit that aggregators typically provide.

She explained that the impact on livelihoods has been staggering. In her analysis, she noted that if approximately 2,000 women were directly involved in shea processing, and each family has 5-6 members, that translates to roughly 12,000 people affected through women alone. Add to this the transporters, truck drivers, and their families, and the number swells to tens of thousands of affected individuals. She conservatively estimated that around 50,000 livelihoods were disrupted by the ban.

Recounting a personal example: her adopted daughter from Jos, whom she brought into the shea business. When the ban hit, the family had to engage in prolonged negotiations to recover the money they had advanced.

"Just imagine the back and forth," she said, highlighting the emotional and financial toll on families across Nigeria.

Government Silence on Transition Fuels Crisis

When asked if there were government-led initiatives to ease the transition toward local processing and value addition, Nwankwo clarified that from the initial ban until a week before the extension in February, there were no meetings or engagement with industry stakeholders.

"For the whole of those six months, there was no meeting. We went to the office of the vice president because they said the matter is in his office. We went around seeking attention, believing they would call us for a meeting or ask us more questions. Unfortunately, it was not so," she said, further noting the extra efforts they made to initiate a meeting with the government.

The only meeting that occurred was a week before the extension was announced in February, she revealed.

Fate of Stuck Nuts 

Beyond the human impact, Elizabeth raises critical concerns about product quality that threaten the entire premise of the ban. The shea nuts that were in the system when the ban took effect are still there. This year, new nuts will be mixed with old stock, compromising quality. The Free Fatty Acid (FFA) content, which should not exceed 5%, has already risen to 17-18%, making the resulting butter unacceptable for international markets, particularly in the confectionery industry where the real profit margins lie.

She emphasises that the butter produced from mixed old and new nuts will fail to meet international standards, defeating the government's stated objective of promoting value-added exports.

A Sector Worth Billions, Overlooked by Government

One of Elizabeth's most striking observations is that the government simply didn't understand the value of the industry it was regulating. The shea sector is worth $3.6 billion globally, yet government officials treated it as a minor activity.

Nwankwo claims to have heard shea butter referred to as 'that cream that women are hawking up and down.' This fundamental misunderstanding, she believes, led to a policy decision made without consulting the very people whose livelihoods depended on it.

The Path Forward

Despite her frustrations, Elizabeth remains solution-oriented. She advocates for a comprehensive approach involving stakeholder meetings, large capital investments in processing equipment, warehouse financing, and support for women pickers. She calls for the involvement of development banks, licensing systems, training programs, and the implementation of the commodity exchange framework.

Critically, Elizabeth suggests that the government should allow existing contracted nuts to be exported while establishing clear rules for the future.

"Let it just go and say, okay, this year we are starting. Let's start afresh," she proposes, allowing stakeholders to fulfil existing commitments while preparing for the new processing-focused direction.

Elizabeth concluded that what the sector needs now is not a reversal of the ban, but a collaborative approach to making it work. The approach must protect the livelihoods of the women pickers and other people in the value chain while building the processing infrastructure Nigeria needs to dominate the global shea market.