How manufacturers sourced local inputs in H1 of 2017

Nigerian manufacturers sourced more raw materials locally in the first six months of 2017 (H1 of 2017) compared with the corresponding period of 2016.

Local raw materials utilisation in the manufacturing sector increased to 60.72 percent in H1 of 2017, as against 46.3 percent recorded in the corresponding half of 2016, data from the Manufacturers Association of Nigeria (MAN) show.

This indicates a 14.42 percentage point increase over the 2016 period. It also represents 0.74 percentage point rise when compared with 59.98 percent of inputs sourced in the preceding half (H2 of 2016).

“The rising local raw materials sourcing can be attributed to the effect of the resource-based industrialisation and backward integration campaigns as well as availability of forex in the economy,” MAN says.

Across sectoral groups, local raw materials sourced in food, beverage & tobacco group increased to 79.12 percent in H1 of 2017, from 67.5 percent recorded in the corresponding period of 2016, representing 11.62 percentage point increase over the period.

It also represents 14.49 percentage point rise when compared with 64.63 percent reported in the preceding half. In the wood & furniture group, local input preference spiked to 68.61 percent in H1 of 2017, from 43.6 percent recorded in the corresponding period of 2016, indicating 25.01 percentage point increase over the period.

This number represents 9.86 percentage point rise when compared with 58.75 percent recorded in the preceding half.

For basic metal, iron, steel, & fabricated metal group, local raw materials sourcing increased to 70.84 percent, from 55.7 percent recorded in the corresponding half of 2016.

Analysis based on industrial zones shows that the local raw material utilisation rose in Apapa, Anambra/Enugu, Kwara/Kogi, Kaduna and Kano Bompai, Ikeja, Apapa, Ogun, Bauchi/Benue/Plateau and Rivers zones. However, it fell in Edo/Delta, Imo/Abia, Oyo/Ondo/Osun/Ekiti and Bauchi/Benue/Plateau zones.

In Apapa zone, local raw materials sourcing increased to 68.3 percent in the period under review, from 42 percent recorded in the corresponding period of 2016, signifying 26.3 percentage point increase over the period.

This number represents 14.3 percentage point jump when compared with 54.0 percent recorded in the preceding half.

In Anambra/Enugu zone, local raw materials utilisation rose significantly to 70 percent in the period under review, from 19 percent recorded in the corresponding half of 2016.

Ogun zone increased its local raw-materials utilisation in the period under review to 66.7 percent, from 50.2 percent recorded the corresponding period of 2016. This indicates 16.5 percentage point increase over the period. It, however, shows 1.3 percent drop when compared with 68.0 percent recorded in the preceding half.

ODINAKA ANUDU