Shea nuts export restriction deadline approaches as industry awaits government decision
As the six-month restriction on raw shea exports nears expiration, stakeholders across the value chain await clarity on whether the government will extend, modify or lift the policy.
With the February 26 deadline approaching, uncertainty is growing over what the federal government will do about the temporary restriction on raw shea nuts exports.
The six-month measure was introduced to encourage more local processing and reduce the long-standing practice of exporting raw kernels while other countries handle the profitable stages of production. Exporters, processors and farmers are all waiting for a clear direction.
Nigeria is one of the world’s largest producers of shea nuts, accounting for an estimated 40 to 45 percent of global supply. The crop is grown mainly across the country’s northern belt and serves as a key source of seasonal income for rural households, particularly women who dominate collection and primary processing.
Despite this scale, the country earns only a small share of the value generated from shea globally. Most of the nuts are exported in raw or semi-processed form, leaving foreign companies to refine them into shea butter used in cosmetics, food manufacturing and pharmaceutical products. These industries generate billions of dollars annually, while producing countries capture only a fraction of the profits.
The export restriction was designed to change that dynamic. By limiting shipments of raw kernels abroad, authorities hoped to increase supply for local processors, revive idle factories and stimulate investment in value-added production within Nigeria.
Push for value addition versus market disruption
Supporters of the policy argue that exporting raw materials while importing finished goods has long constrained industrial growth. They say keeping more shea nuts in the country could strengthen local manufacturing, create jobs and improve foreign exchange earnings through exports of processed products rather than raw commodities.
However, the policy has also generated significant pushback from exporters and traders who depend on established international markets. Many say the restriction disrupted supply chains, strained contractual obligations and created uncertainty that made planning difficult.
Also Read: Tinubu bans raw shea exports for six months to boost jobs, $300m market
Industry sources indicate that exporters have accumulated substantial inventories in warehouses while waiting for clarity from the government. Some had anticipated that shipments would resume automatically once the six-month period ended, but recent signals suggest the authorities may adopt a different approach rather than fully restoring unrestricted exports.
Within government circles, opinions appear divided. Some officials are said to favour extending the restriction to give domestic processors more time to expand capacity and secure financing. Others caution that prolonging the policy without sufficient support mechanisms could harm farmers and traders, particularly if local processing capacity remains inadequate to absorb the available supply.
Available data highlights the structural imbalance the policy was meant to address. Nigeria produces between 300,000 and 500,000 metric tonnes of shea nuts annually, yet local processing handles only a small portion of that volume. Estimates suggest the country captures roughly one percent of a global market valued at about 6.5 billion dollars.
Demand for shea butter continues to rise globally, driven largely by the beauty and personal care industry, where it is widely used in creams, lotions, soaps and hair products. Food manufacturers also use shea derivatives as substitutes for cocoa butter in confectionery production, further expanding their commercial importance.
Farmers have experienced mixed effects since the restriction was introduced. At the start of the policy, prices reportedly fell sharply as exporters reduced purchases, dropping from around 850 naira per kilogramme to roughly 570 naira. Over time, however, prices rebounded as domestic demand strengthened and supply tightened, eventually climbing to about 1,000 naira per kilogramme in some markets.
While the recovery suggests strong underlying demand, the volatility created uncertainty for producers who rely on predictable income from seasonal harvests. For many rural communities, shea collection provides critical earnings during periods when other crops are not in season.
