The worth of unsold manufactured items in Nigeria soared to ₦2.14 trillion in 2024, a pointy rise from ₦1.14 trillion in 2023, in response to the Producers Affiliation of Nigeria (MAN).
This marks an 87.5 % year-on-year improve pushed by weakened shopper demand, surging manufacturing prices, and shrinking buying energy.
MAN disclosed this in its Government Abstract of the {Economic} Overview for the Second Half of 2024, launched on Monday, April 21.
Regardless of the worrying year-on-year bounce, the report highlighted a 27.9 % drop in unsold stock between the primary and second halves of 2024, suggesting improved clearance efforts and worth changes.
“The stock of unsold completed items surged by 87.5 % to ₦2.14 trillion in 2024, pushed by weakened shopper demand, escalating manufacturing prices, and declining buying energy.
“Nonetheless, a half-on-half lower of 27.9 % in H2 2024 suggests improved clearance efforts and worth changes. The Meals, Beverage & Tobacco and Textile, Attire & Footwear sectors confronted essentially the most vital will increase in unsold inventory,” the report acknowledged.
On capability utilisation, the affiliation famous modest development.
“Capability utilisation in Nigeria’s manufacturing sector improved marginally to 57.0 % in 2024, up from 55.1 % in 2023. A half-on-half evaluation confirmed a 1.2 proportion level improve in H2 2024 in comparison with H1 2024.
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“Nonetheless, persistent challenges equivalent to rising power prices, foreign exchange volatility, and excessive rates of interest constrained additional development.
“Sectoral evaluation revealed that Non-Metallic Mineral Merchandise, Motor Automobile & Miscellaneous Meeting, and Chemical & Prescription drugs sectors recorded the best enhancements.”
The evaluate additionally famous elevated reliance on regionally sourced uncooked supplies amid overseas alternate constraints and rising import prices.
“This shift was largely pushed by foreign exchange shortage, excessive import prices, and authorities incentives selling native content material.
“Notable enhancements have been noticed in Wooden & Wooden Merchandise, Textile, Attire & Footwear, and Chemical & Prescription drugs, whereas Electrical & Electronics continued to lag as a result of dependency on imported elements,” the report added.
Talking on the sector’s general efficiency, the Director Basic of MAN, Segun Ajayi-Kadir, mentioned:
“The Nigerian manufacturing sector confronted vital hurdles in 2024, together with excessive inflation, foreign exchange volatility, surging manufacturing prices, and declining shopper demand.
“Whereas some resilience was noticed in sectoral efficiency and elevated native sourcing of uncooked supplies, actual output remained subdued.
“Transferring ahead, stabilising macroeconomic situations, enhancing power provide, and making certain entry to inexpensive financing might be essential for sustaining development and enhancing industrial productiveness.”
