By Chinwendu Obienyi
The growth of Nigeria’s consumer goods industry slowed in 2024, but early signs of recovery are beginning to emerge, driven by operational recalibrations, strategic investments and subtle macroeconomic shifts.
According to the 2025 Consumer Goods Sector Report titled; Recovery, Realignment and Resurgence by Afrinvest, the sector, proxied by the food, beverage, and tobacco sub-activity of GDP, recorded a real growth rate of 2.1 per cent, down from 3.0 per cent in 2023. Its contribution to national output also fell for a third consecutive year to 2.4 per cent, reflecting prolonged strain on both the supply and demand sides of the market.
The report noted that the sector’s weakened GDP footprint signals deeper headwinds in consumer spending and production constraints. “The tough macroeconomic environment, marked by FX volatility, disrupted supply chains, and an elevated cost of capital, continues to stifle growth potential in the short term,” the firm stated.
Yet despite these challenges, a rebound may be underway. Excluding Flour Mills of Nigeria, which delisted in mid-2024, Afrinvest’s coverage universe posted a robust 69.2 per cent year-on-year jump in combined revenue to N3.8 trillion. Losses, though still considerable, moderated substantially. Pre-tax losses reduced by 24.4 per cent to N135.4 billion, while post-tax losses dropped 60.7 per cent to N41.3 billion.
“This signals early traction in earnings recovery, especially as companies reconfigure operations to minimise FX exposure and tighten OPEX discipline,” Afrinvest explained.
Q1 2025 data supports this tentative optimism. Aided by improved cost structures and less reliance on dollar-denominated inputs, many players are beginning to see positive momentum.
Afrinvest now projects an ‘optimistic’ near-term outlook for the sector, underpinned by moderating inflation and growing FX market stability.
The sugar segment emerged as the brightest spot. In April 2025, a $1.0 billion investment deal was signed with a Chinese consortium to establish a large-scale sugarcane plantation and processing facility in Nigeria. The plant is set to launch with an annual processing capacity of 100,000 metric tonnes, scaling to 1.0 million metric tonnes over time.
This development catalysed an already buoyant sub-sector, which grew by 62.3 per cent year-on-year to N1.4 trillion in 2024. BUA Foods, leveraging a direct-to-consumer (B2C) sales model, unseated Dangote Sugar to become the new market leader in the space.
In the food and beverage segment, global cocoa supply chain disruptions from Ghana and Côte d’Ivoire have opened doors for Nigerian producers. With international cocoa prices rising, the federal government has renewed focus on ramping up domestic production to 500,000 tonnes. Nestlé continues to dominate this space, with its food/nutrition and beverage segments accounting for 81.2 per cent
of total company revenue in 2024, up from 79.2 per cent in the previous year.
Conversely, the Home and Personal Care (HPC) segment remains the industry’s weakest link. Unilever’s downsizing and PZ Cussons’ reported deliberations over a market exit reflect the segment’s fragility.
Analysts attribute this to the discretionary nature of its product offerings, which leaves it vulnerable to macroeconomic shocks and depressed consumer confidence.
In the flour milling space, domestic wheat production stagnated at 120,000 metric tonnes in the 2024/25 marketing year due to insurgency-linked disruptions in Borno State, which accounts for nearly 67 per cent of national output. Import dependence remains high. Nonetheless, the sub-sector posted a 115.2 per cent revenue increase to N687.5 billion, aided by price hikes and modest volume growth. BUA Foods again emerged dominant, now commanding 78.8 per cent market share in the combined sugar and flour proxy.
The report concludes that the consumer goods sector is undergoing a fundamental transition. While some sub-sectors show fragility, others—like sugar and packaged foods—are powering forward through strategic pivots, improved efficiencies, and investment-led expansion.
“To sustain recovery, companies must aggressively pursue backward integration, optimise costs, and continuously adapt to evolving consumer behaviours,” Afrinvest advised.