Agro Export Basics For Beginners

With dwindling oil revenue in Nigeria, instability of crude oil prices, scarcity of FX and import irregularities and instability, price instability etc, there is a massive shift by investors into the non-oil sector investments and exports.

The Nigerian export business and investment is driven primarily by the Agricultural commodities and the mining sector.

This article intends to provide a basic export education for the Agricultural export for intending and prospective exporters.

First of all, do your homework and know yourself. Realize that it is a commitment for a long, long term. Know your strengths and go for it. Outlined below is a guide to export trade:

An overview of Export Trade

Categories of Exporter

 
You can export Products/Services from Nigeria under the following categories:

– Merchant

– Agent

– Producer/Manufacturer

Challenges

 
As a beginner in the trade, you may experience some challenges. Some of which are:

(i) Lack of product and Market information

(ii) Logistics Management of export trade

(iii) Non conversant with export procedures and documentation

(iv) Lack of access to fund to start export business

(v) Lack of export culture

How to develop an export culture

(i) Start attending workshops/seminars/conferences to acquire export knowledge and

(ii) Focus on one or two commodities.

(iii) Get extensive education and training and investment information on commodities of interest.

(iv) Pick up trial contract and begin to export.

To start exporting, individuals, companies/cooperatives should seek further understanding on the following subjects:-

• Registration with NEPC as an exporter

• The Export Quotation

• Product sourcing

• Market knowledge

• Funds Sourcing

• Making An Export Offer

• Payment methods

• Export Documentations

Other information required are:

• PRE-SHIPMENT INSPECTION OF EXPORTS (NESS)

• INCOTERMS 2010

• ECOWAS Trade Liberalisation Scheme

Illustration

 
For instance, Mr. X, a successful manufacturer has been in business for about fifteen years. He is turning out a good product; it is selling well in Nigeria; and he would like to extend his plant and increase his production. But to do this, he needs more customers. He has an idea.

Why not look for those new customers in foreign markets as well as at home. This will not only help him, but will bring into his country more of the foreign exchange that it needs.

At this point, he is taking the first step towards becoming an effective exporter – because exporting begins with a state of mind. It is not, or should not be a casual business. A businessman should enter upon an export campaign with energy and determination and with the intention of persevering in it. If he views foreign markets merely as a place to get rid of occasional surpluses, he is an in-and-outer, who makes no enduring impression. Worse, he can damage his country’s reputation as a reliable international trader.

A businessman usually cannot or will not turn into a successful exporter within weeks or even months. It will probably take much longer. But the time and care taken to select the right product and the right place or places for an initial export venture can minimize the risk and make ultimate success quicker and more certain.

Exporting does begin with a state of mind – a state of mind that a firm’s management must share. The management must believe in this importance of exporting, and must realize that it is wise and will be profitable to diversify it markets. 

To start with, it must ensure that export orders always receive the same attention as domestic orders; that money is set aside for research into markets, travel, and promotion; that knowledge about foreign markets is systematically acquired and kept up-to-date. At some stage, it may even consider allocating a certain amount of production to export, and then prepare to go out and sell.

AGRICULTURAL EXPORT COMMODITIES SOURCED FROM NIGERIA.
– Cocoa

– Local Food Stuffs ( Note that restrictions exist for some countries)

– Cassava Starch

– Gum Arabic

– Raw Cashew Nuts

– Ginger

– Dried Hibiscus leaves

– Kola nut

– Bitter kola

– Garlic

– Sesame Seed

– Rubber

– Cotton

– Hides and Skin

– Fresh Vegetables

– Charcoal (Recently banned)

– Wood & Timber

There are so much more. You need to do a thorough research on a particular commodity of interest. Ensure you get proper investment education and a well researched business and investment fact file on each sector of interest.

In conclusion, like earlier stated, you won’t become an exporter just by reading this article or by attending a one or two day workshop. It is a journey that starts with getting the required education first and information. Develop a clear business and funding plan and above all find those who have been into the export business to mentor you.

Article written with references and inputs from the NEPC Export for beginners’ fact sheet.