Nigeria’s biscuit makers are reporting a significant decline in sales, attributed to shrinking consumer budgets, inflationary pressures, and factory shutdowns. A 2017 KPMG report estimated the size of the nation’s biscuit industry at N121 billion, with an annual output of 152,490 tons and a compound annual growth rate (CAGR) of 16 percent over five years.
As of 2017, annual biscuit demand was estimated to be between 15 and 20 percent; however, industry players now believe this figure may have dropped to below five percent as cash-strapped consumers prioritize spending on food, clothing, and shelter.
“The demand for biscuit products is declining very rapidly in the country,” said Akin Akintayo, chairman of the Biscuit and Bakery Group of the Manufacturers Association of Nigeria (MAN). “Our major market consists of average and low-income earners, but many of them are not consuming biscuits like they used to.” He noted that some biscuit manufacturers have been forced to halt operations due to the ongoing decline in sales.
Akintayo attributed the decrease in biscuit consumption to inflation, emphasizing that stagnant incomes amidst rising prices have compelled households to focus their spending on essentials.
Biscuit and Bread Market
The KPMG report estimated the size of the Nigerian biscuit and bread market at N243 billion in 2017. The report indicated that the bread segment was valued at N122.1 billion, accounting for 80 percent of the baked goods sector. The bread segment grew at a CAGR of 14 percent over five years, with an annual production of 554,270 tons and a CAGR of 3 percent.
The report highlighted that the Nigerian bread and baked goods segment is highly fragmented, with 72 percent of the market controlled by artisanal and small-to-medium regional players. In 2017, the biscuit industry was dominated by Yale Foods (37 percent), OK Foods (20 percent), A&P Foods (14 percent), Deli Foods (9 percent), Nigeria Biscuit (5 percent), Beloxxi (4 percent), and others (9 percent). This landscape has shifted today, with Beloxxi experiencing rapid expansion and Deli Foods reportedly shutting down.
Impact of Inflation
In a country where the minimum wage is N70,000 (below $50) per month, accelerating inflation has forced many Nigerians to prioritize their spending. The decline in spending is reflected in MAN’s half-year review report, which showed that the inventory of unsold products in the manufacturing sector rose by 12.9 percent to N1.4 trillion in the second half (H2) of 2024, up from N1.24 trillion in the first half (H1) of the year.
Francis Meshioye, president of MAN, noted at the 2025 Presidential Media Luncheon in January 2025 that the increased inventory among manufacturers is a result of weakened purchasing power, driven by decreasing real household income. Operating margins in the Nigerian biscuit manufacturing segment remain thin, largely due to the volume-driven nature of the business. The price elasticity of demand is also high, given the wide availability of substitute products, particularly cheaper imported biscuits.
**Contrasting Import Data**
According to Volza, which compiles import data, Nigeria imported 8,984 shipments of biscuits between March 2023 and February 2024, primarily from India, China, and the United Kingdom. These imports were supplied by 91 foreign exporters to 155 Nigerian buyers, marking a growth rate of 205 percent. In February 2024 alone, Nigeria imported 777 biscuit shipments, reflecting a year-on-year growth of 56 percent compared to February 2023, and a 44 percent increase from January 2024.
Challenges for Local Producers
Nigeria’s biscuit market is one of the largest in Africa, driven by its vast population, growing middle class, and increasing demand for convenient snacks. Local manufacturers dominate the market, competing with imported biscuits, particularly those from China, India, the United States, and the UK.
The industry supports thousands of jobs, spanning farming, production, distribution, and retail. Fola Osibo, the former chairman of the Biscuit and Bakery Group of MAN, stated during the group’s annual general meeting last year that biscuit makers are facing challenging times, with some manufacturers struggling to survive. He cited issues ranging from restrictive policies to uncontrollable raw material costs and unfair competition from cheaper imported biscuits.
Muda Yusuf, director and CEO of the Centre for the Promotion of Private Enterprise (CPPE), noted that production performance in biscuit manufacturing has been low due to macroeconomic challenges. “Their capacity is low, and many of them are declaring losses,” he said. “The challenges of foreign exchange and high interest rates have made the situation very difficult for them.”
In 2023, Mayor Biscuits Company Limited (MABISCO), an indigenous company, shut down its biscuit manufacturing division to focus on other business areas.
