Commodity imports up 1.9%, exports down 0.3%
By Yinka Kolawole & Emmanuel Elebeke
The National Bureau of Statistics (NBS) has reported that Nigeria’s terms of trade (ToT) decreased by 2.13 percent in the third quarter of 2020 (Q3 2020).
NBS noted in its quarterly report on Commodity Price Indices and Terms of Trade (Q3 2020) that the slip in the ToT is due to rise in commodity import index and decrease in export price index.
The terms of trade (ToT) represent the ratio between a country’s export prices and its import prices. The ratio is calculated by dividing the price of the exports by the price of the imports, usually in percentage terms.
NBS stated: “The All Commodity group import index rose by 1.89% between July and September 2020. This was driven mainly by an increase in the prices of Products of the chemical and allied industries (9.55%), wood and articles of wood (4.379), and live animals; animal products (4.06%). However, it was negatively affected by decline in the prices of Prepared foodstuff: beverages (5.07%), textile and textile articles (-1.07%) and Raw Hides & skins, leather (-0.92%).
“Between July and September 2020, All Commodity group export price index decreased by 0.30% due to decrease in the prices of Products of Chemical and Allied industries (-2.10%), Base metals and articles of base metals (-1.95%) and Paper making material (-0.74%). However, increases were recorded for Boilers, machinery and appliances (5.38%), Prepared foodstuffs, beverages, spirits and Vinegar (1.9%) and Vegetable products (1.05%).
“On average, the terms of trade decreased by 2.13% during the third quarter. This decrease is explained by a significant decrease in Products of the Chemical and Allied industries (- 11.06%), Base metals and articles of base metals (-4.23%) as well as Live Animals, animal products (- 3.16%). The decline was offset by higher prices of Prepared foodstuffs; beverages, spirits, and vinegar; tobacco (7.28%) and Boilers, Machinery and Chemical appliances (5.26%).”
The Bureau further disclosed that Nigeria’s major trade partners in Q3 2020 were India, Spain, the Netherlands, Turkey and China, with major exports to these countries being crude petroleum and natural gas while the major imports were Motor spirits, motorcycles and antibiotics.
“India was the largest export market of Nigeria in Q3 2020. Export trade to India was valued at N500.63 billion, or 16.73% of the value of total exports. The dominant export commodity to India was Crude oil (valued at N444.89 billion). This was followed by Natural gas, liquefied (N49.1 0billion), Cashew nuts, in shell (N 2.18billion), Soya beans, whether or not broken (N 1.14 billion) and Leather further prepared after tanning/crusting, (N0.71billion).
“On the other hand, Nigeria imported motorcycles and cycles, CKD by established manufacturers (N50.71billion), Other Antibiotics (N26.36billion), Vaccines for human medicine (N20.22billion), Other Polyethylene (N9.27billion) and others.”