Agro-based export dynamics in Nigeria: Regional flows and determinants of export propensity

Abstract

The study examined the outflow and volume of agro-based commodities from Nigeria to other regions.  Using cross-sectional data (2022 – 2023), 127 active agro-based firms engaged in the export of processed agricultural products were selected using simple random sampling technique. Data were collected with a Google Form and analyzed using descriptive and Probit regression models. Findings showed that 41.02% of agricultural produce, valued at ₦ 4.91 billion, was traded to the Asian region. The Western region (Europe and the USA) accounted for about 20%, while African countries’ import of Nigeria’s agro-based products was 37.27%. Probit model assessment of the propensity of agro-based manufacturing firms to export showed that the volume of export of agricultural commodities (β = 0.974, p = 0.037), firm size (β = 0.0036, p = 0.008), educational status of firms’ managers (β = 0.0113, p = 0.000), firms’ international experience (β = 0.0078, p = 0.000), firm characteristics (β = 0.554, p = 0.001) and export marketing strategy (β=0.295, p = 0.049) increase significantly and consistently with firms’ propensity to export agro-based commodities. Conversely, the propensity of agro-based firms to export decreases significantly with an increase in export destination (β = -0.315, p = 0.029), management characteristics (β = -0.0123, p = 0.000), and domestic market characteristics (β = -0.129, p = 0.000). Empirical evidence suggests appreciable volume of agricultural commodities to Asia and Europe, and the USA in spite of the dwindling share of agriculture in the nation’s economy. Therefore, strengthening export policies and bilateral relationships with regions that showed appreciable interest in the importation of agro-based products from Nigeria will increase the competitiveness of Nigeria’s commodities with the rest of the world.