Nigeria has extended its ban on raw shea nut exports for an additional year, until February 2027, as part of a strategy to expand domestic processing and capture a larger share of the global shea value chain.
The policy, which took effect on February 26, 2026, builds on an initial six-month moratorium imposed in August 2025. Under the new rules, all shea exports must be routed through the Nigeria Commodity Exchange, eliminating previous exemptions for direct shipments of raw nuts. The government also intends to channel financing for new processing facilities through the Nigeria Enterprise Support Scheme.
Nigeria produces approximately 40% of the world’s shea nuts, with annual output estimated between 350,000 and 500,000 tonnes. However, the country captures only about 1% of the global shea market, valued at $6.5 billion, largely because it exports raw nuts. Processed shea butter, a key ingredient in food, cosmetics, and pharmaceuticals, commands prices 10 to 20 times higher than the raw commodity.
The export restriction has already influenced domestic prices. Since the initial 2025 announcement, raw nut prices have declined by roughly one-third, trading around 850 naira per kilogram by the end of the 2025 harvest season. Industry groups had sought a grace period during the first suspension, citing lost contracts, but their request was denied.
Nigeria’s approach mirrors similar policies adopted by other West African producers, including Burkina Faso, Mali, Ivory Coast, and Togo. The region dominates global shea supply, yet most high-value processing and branding occur in Europe and Asia. Major international buyers like Bunge Loders Croklaan and AAK operate some regional facilities, but advanced refining and formulation often remain offshore.
The policy’s success hinges on Nigeria’s ability to overcome persistent challenges, including inadequate processing infrastructure, unreliable electricity, and logistical bottlenecks. If domestic capacity expands and traceability improves, the ban could increase export earnings and create jobs. However, if processing development lags, the measure may depress farm incomes without delivering significant industrial growth. The outcome will depend on coordinated investment across the value chain and the pace of infrastructure improvement.
The extension underscores a broader regional effort to transition from raw commodity exports to greater local value addition, though the path remains constrained by structural and financial hurdles.
