The sugar industry appears to have emerged the most endangered segment in the Nigerian manufacturing sector, after the textile industry, following cumulative pressure on the sub-sector. Local production of sugar is shrinking, jobs are being lost and Nigerians now depend mainly on importation. Stakeholders say the industry is heading for a total collapse if the Federal Government fails to urgently reverse its policy on packaged sugar importation. The Nigerian economy lost N56.2bn to packaged sugar importation in 2009 alone, the Executive Secretary, National Sugar Development Council of Nigeria, Alhaji Usman Bello, said on Sunday.
Speaking with our correspondent in a telephone interview, Usman added that, in the last 10 years, the country had spent about N308bn on the importation of packaged sugar. He, however, did not give a breakdown of the figure.
This trend, according to stakeholders in the industry, has resulted in massive job loss, amounting to 4,000 in the last one decade in the retail sugar segment alone.
Investigation by our correspondent revealed that, out of six firms, only two packaged sugar producing firms currently operate in the country, at far below installed capacities of between three per cent and six per cent.
According to stakeholders, if the Federal Government does not intervene by reversing the policy of open importation of cubed or packaged sugar into the country, the two remaining companies (Dantata Foods and Allied Products Limited and McNicholas Consolidated Plc) may soon wind up.
Our correspondent gathered that 10 years ago, six companies were actively engaged in sugar cubing or production, but four of them collapsed before 2009. Companies that have shut down are Kano Sugar Processing Company Limited (makers of Crown Sugar); Paastra Industries Nigeria Limited, Lagos (makers of Next Sugar); Lange $ Grant Commodities, Lagos (makers of Lucia Sugar); and Nouveau Foods Limited, Lagos (makers of Ivory Sugar).
Industry sources are, however, worried that the current sugar importation policy in the country is inconsistent with the Federal Government’s policy direction of restricting importation of basic food items, where there is enough local capacity to produce such products and meet national demand.
Investigation by our correspondent further revealed that Nigeria required 910,000 metric tonnes of consumable sugar per annum, whereas the total productive capacity of local firms (when operational) is put above two million metric tonnes.
The depression in the sub-sector, it was learnt, started in the early 1990s with the main industry giants of the time - Savannah Sugar Company and Bacita Sugar Company.
Some stakeholders have, however, blamed a French sugar producing firm and a handful of Nigerian importers for the latest trend in the industry’s inglorious era.
Commenting on the sliding fortune of the sugar industry in Nigeria, Bello said, at the peak of production in 1986, both Savannah Sugar Company and Bacita Sugar Company had employed 3,500 full time workers, with over 6,700 seasonal employees.
He said, “Today, the two (under various transformational schemes) employ just about 850 full time and 2,200 seasonal workers, with the bulk resting with Savannah, now managed by Dangote Industries. The two refineries (Dangote and BUA), using imported raw sugar, produce about two million tonnes per annum and employ about 1,400 people.”
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