WTO points to growing pile of rejected Nigerian agric exports

-Initiates $1.2m project to improve cowpea,sesame export quality

Onome Amuge

Nigeria’s once-thriving agricultural export market has been in decline in recent years, due in part to the fact that commodities such as cowpea and sesame do not meet the standards set by the international community. This is according to a recent assessment of the World Trade Organisation (WTO), which noted that Nigerian farmers and exporters need to improve their practices and production methods in order to meet the standards of the global market.

Notably, Nigeria is a major player in the global market for sesame and cowpea, with a leading position in the production of both crops. In 2022, the country produced approximately 500,000 metric tonnes of sesame, making it the fifth largest producer in the world. Sesame is a highly sought-after crop, used in cooking oil, confectionery, and cosmetics, and in demand in markets around the globe. For cowpea, Nigeria is the number one producer, accounting for over half of the world’s production.

According to the National Economic Planning Commission (NEPC), the growing demand for cowpea and sesame in the global market represents a tremendous opportunity for Nigeria’s agricultural sector to expand production and exports. The NEPC projects that the demand for cowpea will increase from $7.2 billion in 2023 to $9.43 billion by 2028. Similarly, the global export value of sesame, which was $7.35 billion in 2022, is expected to grow to $9.27 billion by 2032.

Despite the bright prospects for growth, Nigeria faces some significant challenges in realising its potential in the global market for cowpea and sesame. One of the main challenges is the rejection of these products by some key markets, such as the European Union, due to concerns about poor transportation and storage. These issues have led to a loss of investment opportunities and a failure to meet global demand for Nigerian cowpea and sesame products.

Ngozi Okonjo-Iweala,the director-general of the World Trade Organisation (WTO), recently acknowledged that Nigeria’s exports of cowpea and sesame have been met with increasing rejections in foreign markets due to non-compliance with international Sanitary and phytosanitary (SPS) standards. She pointed out that this has resulted in significant revenue and foreign exchange losses for Nigeria, highlighting the need for the country to take action to address the problem.

According to Okonjo-Iweala, Nigeria’s inability to meet the SPS standards set by regional, global, and individual import countries has resulted in lost sales, revenue, and foreign exchange earnings.

Speaking at the recent launch of seven trade support programmes initiated by the WTO in partnership with other stakeholders, Okonjo-Iweala pointed to data showing that health and safety inspections of Nigerian exports of cowpeas and sesame in the period from 2019 to 2021 revealed that pesticide residue levels were nearly double the maximum limits set by international standards.

The WTO DG warned that if no action is taken to address the safety concerns, Nigeria risks losing its position as the world’s leading producer and consumer of cowpea, and the same could be true for sesame.

She stated: “Nigeria is the world’s largest producer and consumer of cowpeas. Sesame is primarily an export crop, and Nigeria is the world’s fourth-leading producer, exporting to the EU, Türkiye, Japan, South Korea and other Asian markets.

However, Nigerian cowpea and sesame exports have increasingly faced rejections in several destination markets due to non-compliance with international SPS requirements.

Nigeria accounts for over a third of Japan’s sesame imports – but health and safety inspections during the past few years have found instances where pesticide residue levels were nearly double the maximum residue limits permissible from 2019 to 2021.”

In an effort to address the issues surrounding Nigerian exports of cowpea and sesame, the WTO announced that it is working with relevant stakeholders to improve practices across the value chains for these crops. With $1.2 million in funding, the initiative aims to improve agricultural practices, such as the application of pesticides, hygiene standards, and post-harvest techniques, so that they meet international standards.

Okonjo-Iweala explained that the initiative will focus on helping Nigeria to gain international certification for the safety and quality of its sesame and cowpea products. The project is being implemented in collaboration with the Standards Trade Development Facility (STDF), International Trade Centre (ITC), and the Nigeria Export Promotion Council (NEPC). It will involve capacity-building, mentoring, training, and the provision of technical assistance to farmers, processors, and exporters.

Okonjo-Iweala noted that Nigeria’s agricultural sector has the potential to play a key role in driving export diversification and job creation, but that this potential has not yet been fully realised. She highlighted the country’s historical prominence as an agricultural exporter, which it has since lost due to a shift towards becoming a net importer of many agricultural products. She stressed the importance of reversing this trend and harnessing the country’s agricultural resources to create more value and jobs in the sector.

The WTO DG further stressed the need to address trade-related issues on the supply side, particularly concerning sesame and cowpea exports. She pointed out the increasing rejection of Nigerian cowpea and sesame exports in various markets due to non-compliance with international standards.

The new project, as outlined by Okonjo-Iweala, aims to enhance the capacities of all stakeholders along the sesame and cowpea value chains. This will involve a range of activities, including improving agricultural practices and ensuring compliance with international standards. The project will also include training local food safety advisors, who will play a key role in improving food safety and quality. In addition, the project will focus on improving agricultural practices, food safety, and post-harvest methods to ensure that the country’s agricultural products meet international standards.

“The project will kick off with an initial amount of $1.2 million, with nearly a million dollars coming from the STDF,” she stated.

Okonjo-Iweala stressed that the project is a low-cost, high-impact initiative that will have a significant positive impact on the agricultural sector and the economy as a whole. According to her, while the WTO is not a financing agency like the World Bank or the International Monetary Fund (IMF), it has a powerful strategy that can leverage the organisation’s convening power and expertise to promote trade and development.

She added, “We spend small sums of money to make a big impact.  A million-dollar intervention can potentially earn Nigeria hundreds of millions or even billions of dollars in increased agricultural exports. This project will support improved incomes for farmers, exporters, businesses, and others involved in the agricultural sector, once producers and exporters adhere to the correct sanitary and phytosanitary standards.”

Nonye Ayeni, executive director of the Nigeria Export Promotion Council, also spoke at the technical meeting on the WTO/STDF PG 845 project, emphasising the importance of taking advantage of the opportunities presented by the global market for sesame and cowpea. She noted that with the right strategies and investments, Nigeria could increase its share of the global market and boost its export earnings.

The NEPC director stated that, based on available information, sesame and cowpea exports from Nigeria had often been rejected. This, she said, was largely due to factors such as poor quality, inefficient procedures and documentation, sanitary and phytosanitary issues, and improper packaging and labeling.

“These militating factors led to the decision of the WTO and International Trade Centre(ITC) to sponsor the STDF project, which will be backed by expected 30 per cent counterpart funding from NEPC.

“This project will enhance the quality and standard of sesame and cowpea through the institution of good Sanitary and Phyto-sanitary (SPS) conducts, Good Agricultural and Warehousing Practices (GAWP), packaging/labelling and excellent storage systems.

“All these are expected to forestall frequent contract cancellations and loss of business opportunities,” Ayeni said.

According to the NEPC’s executive director, the project would result in a significant increase in the global acceptance of sesame and cowpea products, which would lead to better quality for both domestic and international markets. She expressed confidence that the members of the implementing committee would work together to ensure that the highest standards were met for all products.

Ayeni added that the project would ultimately lead to increased foreign exchange flows, which would help to stabilise the currency and support economic development.