Nigeria’s All-Commodity Terms of Trade Remains Marginally Stable in Q1 2025

According to the National Bureau of Statistics‘ (NBS) Commodity Price Index report, Nigeria’s All-Commodity Terms of Trade for January, February, and March 2025 stood at 101.32%, 101.15%, and 101.37%, respectively. The All-Commodity Group Terms of Trade decreased by 0.18 percentage points in February and increased by 0.23 percentage points in March, resulting in a 0.05 percentage point increase in the first quarter of 2025.

The report also showed that the All-Commodity Group Import Index for Q1 2025 decreased on average by 0.26 percentage points, driven by reduced import prices for goods, such as the products of the chemical and allied industries, raw hides and skins, and leather and fur skins, among others.

All-Commodity Group Export Price Index

However, the All-Commodity Group Export Price Index decreased on average by 0.21 percentage points, driven by price reductions in the export prices of plastic and rubber products, wood and articles of wood, and animal and vegetable fat oils. This means that Nigeria earned less from exports in this category.

The report also indicated that while prices for both imports and exports fell, import prices were relatively lower than export prices, resulting in the modest improvement recorded in the Terms of Trade. The slight increase of 0.05 percentage points in Q1 2025 implies only minimal improvement and suggests that Nigeria’s external trade remains highly sensitive to price shifts in key commodities.

Reduction in export prices for plastics

Furthermore, the reduction in export prices for plastics, rubber, and wood, among others, reveals vulnerabilities in the Nigerian non-oil export base and implies reduced foreign exchange earnings from these sectors, which may set back diversification goals.

Therefore, the government should prioritise adding value to exports and developing downstream industries that would stabilise export earnings and reduce susceptibility to global price shocks.