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Chemical.9.Thmb.jpg Chemical exports to Africa on the rise

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Francis Kokutse | 22 Jul, 2013
Africa is presenting a busy market for India's chemical exports as figures for Nigeria alone indicate considerable growth. Exports of chemical items from India to Nigeria alone have increased to about 5.6 percent from 2012 to 2013, according to the Chemical Export Promotion Council of India (ChemExcil).

In addition, total volume of exports to Nigeria this year amounted to $90.3 million as against $85.5 million last year, ChemExcil executive director Suhas Bhardi said at an exhibition that opened here with over 80 companies in attendance.

"The purpose of this Exhibition is to strengthen/expand existing business, promote india's chemical exports and to create a positive brand image of Indian products. This would also result in many more joint ventures and technology transfer," Bhardi said.

The Indian Chemical and Cosmetics Exhibition has been organised by ChemExcil in collaboration with the Pesticides Manufacturers and Formulators Association of India (PMFAI) and the Indian High Commission in Lagos.

The sector, which consists mainly of petrochemicals, accounts for over 70 percent of the total chemical market in Nigeria. "I am happy to note that the upstream petrochemical sector is well established as Nigeria is the highest oil-producer in Africa," Bhardi said.

PMFAI president Pradip Dave said the African region offered most potential for improvement in the productivity of crops and the African governments have therefore given priority to development of agriculture in the region.

Dave said that there was a good market for agrochemicals in Nigeria, adding that "it is estimated that the private sector agrochemical companies supply about 70 percent of the total CPP demand of approximately $120 million."

"Most of the African countries are now concentrating on development of irrigation projects and, with a modern irrigation system, by optimising and conserving water resources and also introducing drought resistance varieties. The drought resistance and high yielding varieties will definitely boost the agricultural production in the African region which will also help in boosting agricultural exports from Africa," he said.

ChemExcil's studies have shown that Nigerian companies consume in excess of $3.58 billion worth of chemicals per annum but produce just $380 million, an indication that the country is a potential market for the export of chemicals.

"The base chemical sectors, which consists mainly of petrochemicals, accounts for over 70 per cent of the total chemicals market in Nigeria. The upstream petrochemicals sector is well established as Nigeria is the highest oil producer in Africa," the council said on its website.

"Limited development of the downstream sector constrains growth of not only the base chemicals sector but also the total chemicals industry in Nigeria. In the speciality chemicals sector local manufacturing is focussed on paints, coatings and adhesives, using imported raw materials," it added.

For the remaining speciality chemical products, such as preservatives, water treatment and wood and textile treatment chemicals, local manufacture is limited. "The high operating costs as well as a lack of access to raw materials restrains the development of further manufacturing for a wider range of speciality chemicals," it said.

ChemExcil said, "Most regional and global speciality chemicals manufacturers supply raw materials and inputs to the local manufactures through distributors and also use the distributors to import fully manufactured speciality chemicals."

It has also identified a major market in essential oils flavours and fragrance/cosmetics/soaps and toiletries industry on the African continent.

"Africa's middle class has tripled in size in the last 30 years and is driving the continent's demand for cosmetics," it said.

"In Nigeria, cosmetics companies are racing for market share. While multinational brands dominate the market in Kenya and Uganda, and lack of capacity for local manufacturing remains an issue, local entrepreneurs are outsourcing manufacture and are using unique sales strategies."

After the Lagos exhibition, the ChemExil would move on to Addis-Ababa, Ethiopia, for a Buyer-Seller Meet and then to Dar es Salaam, Tanzania, July 23.
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