Nigeria’s drive to diversify its economy and deepen agro-industrial development has received a fresh boost as the Nigeria Governors’ Forum and the National Sugar Development Council agreed on a strategic partnership to accelerate sugar production across the country.
The collaboration places sugar firmly at the centre of state-level industrialisation efforts, with a strong focus on investment attraction, job creation, and import substitution.
The decision followed high-level engagements between the NGF and the NSDC, during which state governors committed to prioritising sugar projects in discussions with development partners, both locally and internationally.
The move signals growing political will to reposition agriculture-linked industries as engines of economic growth amid rising import costs and foreign exchange pressures.
Sugar industry expansion to drive industrialisation and jobs
Central to the NGF–NSDC collaboration is a shared commitment to sugar industry expansion as a pathway to sustainable industrial development across Nigeria’s states.
Under the new framework, sugar projects will be treated as priority ventures, enabling states to access technical support, financing opportunities, and investor networks coordinated by the NGF secretariat and the NSDC.
The partnership aims to help states prepare investor-ready sugar projects by improving coordination around land acquisition, infrastructure provision, and incentive structures.
It will also facilitate structured engagement between state governments, private investors, and industry operators, addressing long-standing bottlenecks that have slowed large-scale sugar investments.
According to the NSDC, Nigeria’s continued dependence on raw sugar imports remains a major drain on foreign exchange, despite the country’s vast arable land and favourable agro-climatic conditions.
The renewed push for sugar industry expansion is expected to reverse this trend by boosting domestic capacity and reducing exposure to volatile global markets.
Eleven states identified as prime sugar investment hubs
Presenting the sector’s investment outlook to NGF officials, the Executive Secretary and Chief Executive Officer of the NSDC, Mr Kamar Bakrin, urged governors of sugarcane-producing states to embrace sugar project development as a strategic priority.
He identified 11 states with strong comparative advantages for commercial sugar production: Oyo, Kwara, Niger, Nasarawa, Kaduna, Kano, Bauchi, Gombe, Jigawa, Adamawa, and Taraba.
Bakrin noted that Nigeria has approximately 1.2 million hectares of land suitable for large-scale sugarcane cultivation, far exceeding the estimated 200,000 hectares required to achieve national self-sufficiency.
He stressed that the availability of land, water resources, labour, and supportive policies positions Nigeria favourably for sustained sugar industry expansion.
Exchange rate shifts strengthen local sugar competitiveness
Recent macroeconomic developments, particularly exchange rate adjustments, have significantly altered the economics of sugar production in Nigeria.
While global sugar prices have remained relatively stable in dollar terms, the depreciation of the naira has made imported sugar considerably more expensive, improving the competitiveness of locally produced sugar.
Bakrin explained that domestic sugar production relies largely on naira-denominated inputs, insulating producers from currency volatility and enhancing profit margins.
As a result, sugar industry expansion has become more commercially attractive, especially for investors seeking long-term returns in Nigeria’s agro-industrial space.
He added that Nigeria’s sugar sector is now valued at about $2bn, with continental opportunities under the African Continental Free Trade Agreement estimated at $7bn.
Beyond refined sugar, the market for sugar by-products—including ethanol, animal feed, and bio-electricity—is estimated at $10bn within Nigeria alone.
Addressing concerns around land use and community displacement, the NSDC boss emphasised that modern sugar projects are designed to integrate host communities into the value chain.
Through outgrower schemes and direct employment, local farmers and residents are positioned as partners rather than bystanders.
According to Bakrin, sugar industry expansion offers a unique opportunity to promote inclusive rural development by creating jobs, improving incomes, and supporting environmental sustainability.
He noted that sugarcane projects typically involve long-term investments in infrastructure such as irrigation systems, roads, and power generation, which also benefit surrounding communities.
He cited a model sugar project with an annual output of 100,000 metric tons, requiring an estimated $250m investment.
Such a project, he said, could deliver an internal rate of return of about 24 per cent while generating additional revenue streams from ethanol production and bio-electricity.
On behalf of the governors, the Director-General of the NGF, Dr Abdulateef Shittu, said many states were already engaged in sugar-related initiatives or exploring entry into the sector through land development and agro-industrial schemes.
He stressed that unlocking the sector’s full potential would depend on effective coordination, credible investment frameworks, and alignment between federal policy objectives and state development plans.
Shittu pledged the NGF secretariat’s commitment to ensuring that state governments increasingly prioritise sugar projects, recognising their potential to drive rural development, reduce unemployment, and strengthen local economies.
As Nigeria seeks sustainable alternatives to oil revenue, stakeholders believe that a coordinated push for sugar industry expansion could mark a turning point in the country’s quest for agro-based industrial growth.
