Why Nigeria needs functional paper mills

Nigeria had three functional paper mills in the 1980s and 1990s, but the mills are almost redundant today.

The three paper mills of the 1980s were: Nigeria Paper Mill (NPM)Limited located in Jebba, Kwara State; Nigerian Newsprint Manufacturing Company (NNMC)Limited, Oku-Iboku, Akwa Ibom State; and Nigerian National Paper Manufacturing Company (NNPMC) Limited in Ogun State.

Today, only the mill at Iwopin is working at below 30 percent capacity.

Studies show that Nigeria loses N180 billion annually from non-performance of these paper mills.

Each year, newspaper houses and publishing firms import newsprints and papers running into billions of naira, despite the country’s luscious trees whose barks can be used for paper production. Nigeria spends N50 billion on the import of papers annually, data from the Raw Materials Research and Development Council (RMRDC) say.

The history of Nigeria’s paper and pulp industry has been a telltale of woes. In the 1960s and 1970s, the federal government established the three paper mills for the purpose of producing bond paper. The NPM produced 40,480 tons of kraft paper by 1985 and 42,960 in 1986, representing 62.3 percent and 66.17 percent capacity utilisation respectively.

The NNMC performed well and operated profitably, as the volume of newsprints in the company rose from 28,927 tons in 1989 to 37,581 tons in 1990.

Owing to the optimal utilisation of the mill, importation of newsprint fell drastically to 17.5 percent in 1986 and 12.5 percent in 1987. But this was short-lived as the third mill NNPMC was abandoned in 1983 when the mill was at nearly 85 percent completion.

Privatisation put the paper mills in the hands of investors who were accused of sabotaging the country’s dreams by importing papers from their countries rather than developing functional mills locally. Though this is speculative, former staff members of these mills believe that those who took over the management of the mills did not put enough efforts to revive them.

“The co-investor that bought the Nigeria Paper Mill (NPM) Limited did not buy it to help Nigeria,” said Samson Ololade Ogundele, ex-senior manager, Nigeria Paper Mill Limited, Jebba, Kwara State in Lagos, said at a stakeholders’ forum in Lagos in 2016.

“I know it was valued at about N30 billion in Nigeria as at 1995, but this same mill was given to the investor at N334 million in 2008. The aim of the government in handing over the mill was to create jobs and improve the economy. The majority of Nigerians working in Nigeria Paper Mill –both junior and senior—are all casual,” Ogundele disclosed, adding that the Federal Government must re-visit the privatisation in spite of the fact that it is the only paper mill working at the moment.

In March this year, the federal government handed over the Iwopin Paper Mill in Ogun to the core investor, Beulah Technical Company Limited. Abimbola Ogunwusi and Peter Onwualu, director and former director-general of the Raw Materials Research and Development Council (RMRDC) respectively believe that the integrated pulp and paper mills established in Nigeria were privatised as a result of lack of adequate funds to import requisite raw materials and generally because of their non-performance.

The major problems the mills continue to face is the dependence on imported long fibre pulp and chemicals. Experts say there is a need to deepen the local pulp market.

Oluwadare Oluwafemi, a professor in the department of agriculture and forestry, University of Ibadan, identified the inability to source long fibre trees as one key reason for the non-performance of the mills.

Oluwafemi lamented the abysmal fund devoted to research institutions, while also calling for the establishment of pulp and paper institute to save the country from these humongous losses.

“It is unfortunate that 90 percent of papers used in Nigeria are imported,” Oluwafemi said, while presenting a paper entitled, ‘Long Fibre Pulp Production in Nigeria: Prospects and Challenges’, calling for the reversal of the privatisation process which he said was faulty.

Private companies such as Onward Paper Mill Limited, Epesok Paper Mill and NIXIN have come into the industry to tap into the growing opportunity in it. But with almost 200 million and growing need to educate under-25 population who are more than half of the population, experts believe the country needs a number of paper mills locally to reduce pressure on foreign exchange and reduce cost of operations for many struggling media houses.

ODINAKA ANUDU