Nigeria’s Commodity Terms of Trade falls 0.51% in Q1 2021 – NBS

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TERMS FO TRADE FOREIGN TRADE Global trade Merchandise Trade
A container ship leaves the Port of Los Angeles. About 80% of international trade in goods is carried by sea. © Angel DiBilio

The National Bureau of Statistics (NBS) says Nigeria’s commodity terms of trade drops 0.51% in the first three months of 2021. The NBS disclosed this in its quarterly Commodity Price Indices and Terms of Trade (Q1 2021) published on its website.

According to the report, the decline was driven by decreases in Boilers, machinery and chemical appliances, Base metals and articles of base metals and Mineral products.

The All commodity group import index increased by 0.82% driven mainly by an increase in the prices of Mineral products, Live animals; animal products and Animal and Vegetable fats and oils and other Cleavage products.

TERMS FO TRADE FOREIGN TRADE Global trade Merchandise Trade
A container ship leaves the Port of Los Angeles. About 80% of international trade in goods is carried by sea. © Angel DiBilio

The All commodity group export index rose by 0.31% due to increases in the prices of Live animals; Animal products, Vegetable products as well as Animal and Vegetable fats and oil.

According to the bureau, the All region group export index rose 0.31% due to increases in the prices of exports to all regions. The All region group import index decreased by 0.82% due to decreases in prices of imports from America and Oceania.

The All region Terms of Trade, on average decreased by 0.51% due to unfavourable terms of trade in the regions of Asia and Oceania. The top five trading partners for Nigeria in Q1 2021 were India, Spain, China, the Netherlands and France. The major export was crude petroleum and natural gas. The major imports from these countries were Motor spirits, motorcycles and antibiotics.

Commodity Price Index January to March 2021

  1. All commodity group import index

The All commodity group import index increased by 0.82% between January and March, 2021. This was driven mainly by an increase in the prices of Mineral products (1.53%), Live animals; animal products (1.38%) and Animal and Vegetable fats and oils and other Cleavage products (1.24%).

However, the index was negatively affected by declines in the prices of products of the chemical and Allies industries (-0.36%) as well as Wood and articles of wood, wood charcoal and articles (-0.29%).

Between January and February 2021, the All commodity group import price index increased by 0.75%. This was driven by increases in the import prices of Animal and Vegetable fats and oils and other Cleavage (1.77%), Mineral Products (1.63%) and Live animals; animal products (1.37%). The increase was, however, offset by a decline in the price of Products of the Chemical and Allied Industries (-0.73%) and Wood and articles of wood, wood charcoal and articles (-0.58).

Between February and March 2021, the All commodity group import index grew by 0.07%, driven by an increase in the prices of Base metals and articles of Base metals (0.51%), Boilers, Machinery and Appliances (0.50%) etc.

The index was negatively affected by the decline in the prices of Animal and vegetable fats and oils and another cleavage (-0.54%), prepared foodstuffs; beverages, spirits and Vinegar (-0.34%) and Plastic Rubber and articles thereof (-0.19%).

  1. All commodity group export index

The All commodity group export index rose by 0.31% between January and March 2021. This was due to increases in the prices of Live animals; Animal products (2.26%), Vegetable products (2.09%) as well as Animal and Vegetable fats and oil (1.47%).

Between January and February 2021 the All commodity export price index rose by 0.92% as a result of marginal increases in the prices of prepared foodstuffs; beverages, spirits and Vinegar; tobacco (1.30$%), wood and articles of wood, wood charcoal and Articles (0.95%), Vehicles, aircraft and parts (0.94%), Base metals and articles (0.94%) etc.

Between February and March 2021, the All commodity group export index decreased marginally by 0.61%. This was driven by decreases in the prices of Wood and articles of wood, wood charcoal and articles (-0.65%), Vehicles, aircraft and parts thereof, (-0.64%), as well as base metals and articles of base metals (-0.64%).

The index was driven in the positive direction by increases in the prices of Live animals; animal products (1.35%), Vegetable products (1.19%) and Animal and vegetable fats and oil (0.57%) amongst others.

Terms of Trade by commodity

The All commodity Terms of Trade Index for January, February and March 2021 stood at 101.64, 101.81 and  101.12 respectively.

The All commodity group terms of trade increased by 0.17% in February but fell by 0.67%  in March resulting in an average decline of 0.51% between January and March 2021. The decline was driven by decreases in the prices of Mineral products (-1.21%), base metals (-0.65%), and Boilers, machinery and chemical appliances (-0.46%) but was offset by increases in the prices of Vegetable products (2.0%), Live animals; animal products (0.88%) and Products of the chemical and allied industries (0.68%) respectively.

Between January and February 2021, All commodity terms of trade increased by 0.17%. The products that contributed to the increase were Products of the chemical and allied industries (1.65%), Wood and articles of wood, wood charcoal and articles (1.54%) and, marginally, Papermaking material; paper and paperboard, articles (0.75%).

It was offset by declines in the prices of Animal and vegetable fats and oils and other cleavage products (-0.85%), Mineral products (-0.71%) and Live animals; animal products (-0.46%).

Between February and March 2021 All commodity terms of trade decreased by 0.67%. This was as a result of decreases in the prices of Base metals and articles of base metals (-1.14%), Products of the chemical and allied industries (-0.97)%, Wood and articles of wood (-0.94%).

This was positively offset by Live animals; animal products  (1.34%), Vegetable products (1.29%) and Animal and Vegetable fats and oils and other cleavage products (1.11%).

All-Region Group Export Index

All-Region export index increased by 0.31% between January and March 2021 due to marginal increases in prices of exports to all Regions as follow: Asia (0.33%), Europe (0.31%), Oceania (0.31%), America (0.31%), and Africa (0.26%). The month-on-month changes showed an increase of 0.92% in February and a decrease of 0.61% in March.

 Between January and February 2021, the export index recorded an increase of 0.92% due to marginal increases in prices of exports to all regions: Africa (1.04%), Europe (0.92%), America (0.91%), Oceania (0.90%) and Asia (0.87%).

Between February and March 2021 the monthly change stood at -0.61%, driven by decreases in the prices of exports to all regions: Africa (-0.79%), America (-0.60%), Asia (0-53%), Europe (-0.61%) and Oceania (-0.59%).

All-Region Group Import Index

The All-Region import index rose 0.82% between January and March 2021 due to marginal increases in prices of imports from some Regions: Europe (1.16%), Asia (0.75%) and Africa 0.11%). However, prices of imports from America and Oceania during the period recorded marginal decreases of 0.26% and 0.36% respectively. The month-on-month changes showed an increase of 0.75% in February and 0.07% in March.

Between January and February 2021 the monthly change of 0.75% was due to increases in import prices from Europe (1.28%), Asia (0.46%) and Africa (0.22%), but was offset by declines in import prices from America (-0.52%) and Oceania (-0.73%).

Between February and March 2021, the All region import index recorded a slight increase of 0.07%, driven by higher prices of imports from Oceania (0.37%), Asia (0.29%) and America(0.26%). It was offset by a decline in the prices of imports from Africa (-0.11%), and Europe (-0.12%).

Terms of Trade by Country of Regions

The All-Region group terms of trade index stood at 101.64 in January, 101.81 in February and 101.12 in March.

The terms of trade by region rose 0.17% in February but decreased by 0.67% in March. On average, the All region terms of trade decreased by 0.51% between January and March 2021 due to unfavourable terms of trade across all regions.

Merchandise Trade By Top Five Partners And By Major Commodities (N’m) Q1, 2021

1. India

The total export to India in the period was valued at N488.1 billion or 16.8% of total export. The largest export commodity to India was Petroleum oils and oils obtained from bituminous minerals, crude valued at (N462.12 billion). This was followed by Natural gas liquefied, Cashew nuts in shell, Leather further prepared after tanning and Coconut valued at N11.61billion, N5.13billion, N3.17 billion and N1.10 billion respectively.

Imports from India were valued at N589.11billion, accounting for 8.6% of total imports. Import trade during the period was dominated by imported motorcycles and cycles (N86.67 billion), followed by Parts of Machinery for working Rubber (N67.81 billion), Other Antibiotics (N45.32billion) and others.

2. Spain

The value of total exports to Spain stood at N287.2billion or 9.9% of total export. The dominant export product was Petroleum oils and oils obtained from bituminous minerals, crude valued at N213.1billion. This was followed by Natural liquefied gas worth N62.3 billion and Leather further prepared after tanning valued at N8.6 billion. Others are well-fermented Cocoa beans and Technical specified Natural Rubber valued at N1.2billion and N0.5 billion respectively.

On the other hand, the value of imports from Spain during the quarter stood at N78.9billion. Motor Spirit (ordinary) ranked first in imports, valued at N20.82billion, and was followed by Mixed alkylbenzenes & mixed alkyl naphthalenes, valued at N13.75billion, Petroleum Bitumen (N6.38 billion) and Gypsum; anhydrite worth N5.81billion.

3. China

Export to China was valued at N190.1billion or 6.5% of total export in the period. This was largely dominated by exports of Petroleum oils and oils obtained from bituminous minerals, crude (N57.61billion), Natural Gas liquefied (N47.50billion) and Sesamum seeds (N23.11billion).

On the other hand, the value of imports from China stood at N2009.94billion representing 29.34% of total imports. The largest import commodity from China was Machines 4 the reception, conversion & transmission (N75.12 billion), T-shirts, Singlet and other Vests of Cotton (N62.60 billion), Other Herbicides (N60.35billion) and others.

4. The Netherlands

Nigeria’s export to the Netherlands in Q1, 2021 was valued at N160 billion or 5.5% of total export. Major export products were Petroleum oils and oils obtained from bituminous minerals, crude valued at N144.79billion. This was followed by Good Fermented Nigerian Cocoa Beans valued at N9.15billion, Superior quality Cocoa beans (N1.95billion) and other frozen shrimps (N1.06 billion).

However, the value of import stood at N726.09, with commodities imported including antibiotics valued at N329.23billion, Motor Spirit ordinary valued at N213.64billion, Gas oil (N71.85billion) and others.

5. France

In Q1 2021, Nigeria’s exports to France was valued at N133.4 billion, accounting for 4.6% of total export. Major commodities exported during the period were Natural gas, liquefied valued at N72.99 billion, Petroleum oils and oils obtained from bituminous minerals, crude (N55.55billion), Oil cake and other solid residues (N1.88 billion) and others.

On the imports side, the value of imports amounted to N128.41billion, with leading commodities including Motor spirit (N43.96billion), Malt not roasted (N10.26billion), Other parts of Aeroplanes and Helicopters (N7.74 billion). Other products imported were  Milk and Cream powder (N4.88billion) and transmission apparatus (N3.46 billion).