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All Region Terms of Trade Index Rose Marginally By 0.10% - NBS

Nigeria Economy	5062 VIEWS
Nigeria Economy
5062 VIEWS

Monday, December 31 2018 / 06:30 PM / NBS

Highlights:

Between July and September 2018 (Jan 2018=100):

The All commodity group import price index decreased by 1.76% due to prices of vegetable products.
The All commodity group export price index rose by 1.26% driven by prices of prepared foodstuffs; beverages, spirits and vinegar; tobacco and Footwear, headgear, umbrellas, sunshades, whips etc.
The All products terms of trade (TOT) index rose by 0.52% driven by prices of prepared foodstuffs; beverages, spirits and vinegar; tobacco and Footwear, headgear, umbrellas, sunshades, whips etc.
The All region group export index rose by 1.05% as a result of trade with the Continent of Asia
The All region group import index rose by 1.22% as a result of trade with Oceania and Asian Regions
The All region terms of trade rose marginally by 0.10% as a result of trade with Asia and other African Countries.

In Q3 2018, Nigeria’s top five trading partner countries were India, China, Spain, France and the Netherlands.

The major export to these countries was crude petroleum and natural gas
The major import from these countries was motor spirit (ordinary) and motorcycles

Terms Of Trade

The terms of trade (TOT) represent the ratio between a country’s export prices and its import prices. The ratio is calculated by dividing the price of the exports by the price of the imports, usually in percentage terms. The terms of trade for Nigeria is calculated as the value of total exports as percent of the value of total imports. An increase in the terms of trade between two periods (or when TOT is greater than 100%) means that the value of exports is increasing relative to the value of imports, and the country can afford more imports for the same value of exports. For example, an increase in the price of oil between two periods (with oil production remaining the same) is likely to increase or improve the terms of trade for Nigeria. The TOT, which is recorded as an index, can be used as an indicator of the health of an economy.

Commodity Price Index July To September, 2018

1. All commodity group import index (Table 1)

The All commodity group import index grew by 7.5% in the year to July, 2018 .The main drivers to this growth were Vegetable products (5.7%), Prepared foodstuffs (4.7%), Pearls, precious and semi precious stone (4.2%) and Articles of stone, plaster, cement, asbestos, mica, ceramic (3.9%). Between July and August, this index fell by 0.11% between July and August. Similarly, a decrease of 1.65% occurred between August and September. In Q3 2018, the all commodity group import price index decreased by 1.76%.

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The All commodity group import index declined by 0.11% in between July and August, 2018

The main drivers to month –on-month changes were: rising Base metals and articles of Base metals (+2.2%), wood and articles of wood (+1.68%) offset mainly by falling vegetable products (-2.1%) ,Prepared foodstuffs ( -1.68%) and foot wear, headgear etc (-1.57%).

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In September, month –on- month percentage changes were driven by animal and vegetable fats (+3.58%), prepared foodstuffs (+3.56%), Mineral products (+3.12%) and offset mainly by Raw hides and skin ( -1.2%), vegetable products (-1.6%) and Base metals(-3.02%)

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2. All commodity group export index (Table 2)

The All commodity group export index rose 0.2% in August and 1.08% in September, 2018. During the quarter under review, the index recorded an increase of 1.26% and this was driven mainly by prepared foodstuffs (+15.1%) and foot wear, head gear (+16.1%)

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In August, products that contributed the most to the monthly percentage change were prepared foodstuffs (+16.6%), Wood and articles of wood (+5.51), Foot wear, headgear, Umbrellas (+4.38%) and Miscellaneous manufactured (+3.89) offset by Paper making materials (-17.11%), Vehicles air craft and parts (-8.3%) and Animals and vegetable fats and oil (-6.7%)

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In September, 2018, the products that contributed to the monthly changes were footwear, headgear, Umbrellas (+11.7%), Animals and vegetable fats and oils (+7.3%), mineral products (+5.9%), Raw hides and skins, leather (+4.29%) and vehicles, aircraft and parts (+3.6%)

Offset by Miscellaneous manufactured articles (-5.7%), Vegetable products (+4.67%), Prepared foodstuffs (-1.1%) and plastic, rubber and articles (-1.08 %).

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3. Terms of Trade by commodity (2018 Jan=100) (Table 3)

Nigeria’s all products terms of trade (TOT) indices for July, August and September 2018 stood at 98.85, 99.64 and 99.37, respectively indicating that more exports was required to procure the same level of imports in the months under review. Computed statistics show that the product groups that contributed most to the trade positions in these months were prepared foodstuffs and paper making materials.

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4. All Region Group export index (Table 4)

The all region group export index stood at 103.3 in July and 107.2 in August. This shows an increase of 3.77% between the two months. However, in September, the index declined by 2.72% against the value recorded in August.

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5. All Region Group import index (Table 5)

The all region group import index stood at 103.4 in July, 101.5 in August and 104.6 in September. This indicates decrease of 1.78% in August against the index recorded in July and an increase of 3% in September against the level in August.

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6. Terms of Trade by Country (Regions) [2018 Jan=100] (Table 6)

The all region terms of trade stood at 99.9 in July and 105.6 in August, indicating a growth of 5.65%. However, this was reversed in September as the index declined by 5.56% against the level recorded in August, to 99.7.

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7. Merchandise Trade By Top Five Partners By Major Commodities In Q3,2018 (N’million) (Table 7)

In Q3 2018, Nigeria’s top five trading partner countries were India, China, Spain, France and the Netherlands.

A. INDIA

The major export of Nigeria to India during the quarter was Petroleum oils and oils obtained from bituminous minerals, crude valued at N719.2billion.This was followed by Natural gas, liquefied (N37.7billion), Cashew nuts, in shell (N4.7billion), Unwrought lead (excl. refined and containing antimony) (N0.7billion) and Leather further prepared after tanning/crusting without wool on of goats or kids(N 0.3billion). On the import side, Nigeria imported motorcycles and cycles at N29.2 billion, Other antibiotics valued at N7.0 billion, Machines for cleaning/sorting/grading seed, grain or dried vegetables (N 3.6billion), Knitted or crocheted Treated mosquito nets (N 3.4 billion).

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B. CHINA

The major export of Nigeria to China during the quarter was Petroleum oils and oils obtained from bituminous minerals, crude valued at N24.5billion. This was followed by Natural gas, liquefied N20.0billion, Butanes, liquefied valued at N13.6b, Propane, liquefied worth N9.5billion and Other petroleum gases etc in gaseous state N 5.5billion.

In terms of imports, Nigeria imported Amorphous PET chips worth N 14.6billion, Other Herbicides, antisprouting products valued at N14.0billion, motorcycles and cycles N12.0 billion, Chassis fitted with engines for assembly plants, worth N 10.6billion and Flat/hotrolled iron/steel,in coils, worth N10.0 billion

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C. SPAIN

Crude petroleum oils and oils obtained from bituminous minerals valued at N463.1billion was exported to Spain during the third quarter of 2018. Liquefied natural gas worth N 52.7billion, leather (further prepared after tanning/crusting without wool on of goats or kids) valued at N 4.3billion, technically specified natural rubber, in primary forms or in plates, etc worth N 0.59 billion and Cocoa paste, wholly or partly defatted valued at N 0.37 billion were other major exports to Spain. The major imports from Spain were ordinary motor Spirit (N25.7billion), Petroleum bitumen (N3.7 billion), Mixed alkylbenzenes & mixed alkylanaphthalenes (N 3.4billion), Gypsum; anhydrite whether or not coloured, with/without small quantities of accelerators (N1.1 billion) and Mixtures of odoriferous substances used for other industries (N0.4 billion).

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D. FRANCE

The major commodities exported to France were crude petroleum oils and oils obtained from bituminous minerals worth N 422.5 billion, Natural gas, liquefied (N74.2billion), Soyabean crude oil,whether or not degummed (N1.1 billion), technically specified natural rubber, in primary forms or in plates, etc (N 0.9billion) and Oil-cake and other solid residues resulting from the extraction of soya bean oil (N0.7billion).

On the imports side, ordinary motor spirit, other flexible tubing of base metal, with or without fittings, Lubricating oils to be mixed , Machinery for filling,closing, capsuling, labelling, etc machinery for aerating beverages, Other lubricating oils worth N54.6billion, N16.1billion, N3.5billion, N2.9billion and N2.0 billion respectively were the major imports from France.

E. NETHERLANDS

As with the other countries, crude petroleum oils and oils obtained from bituminous minerals was the major export to the Netherlands, at a value of N260.7 billion. Other major exports were Other petroleum gases etc in gaseous state (N 5.6billion), Superior quality raw cocoa beans (N 2.9billion), Other Frozen shrimps and prawns (N 1.9billion) and Polyethylene having a specific gravity >=0.94, in primary forms (N 1.5billion). On the other hand, Nigeria imported Motor Spirit ordinary worth N337.2billion, Gas Oil N48.2billion, Other instruments and apparatus, nes, for medical, surgical sciences N36.7billion, Other antibioticsworth N9.5billion and Herrings (Clupea harengus, Clupea pallasii) worth N 4.1billion.

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