Simplifying Charcoal and Commodity Exports from Africa

Credebt® provides financing to facilitate the trade of commodities and financing for vessels exporting goods around the globe. We also work directly to connect buyers and suppliers. One of the tools we bring to these trades is a product called Credebt Markets®. One example of trades we are involved in using Credebt Markets® is with a company exporting premium restaurant-grade and BBQ-grade hardwood charcoal from Nigeria to international markets in Europe, the Middle East and Asia. Nigeria is a significant exporter of wood charcoal ranking as the 12th largest exporter globally. Nigeria is also one of the largest producers and exporters of charcoal in Africa with the industry playing a significant role in the country’s economy. Charcoal production has a long history in Nigeria and is driven by both domestic consumption and international trade. The primary destinations for Nigerian wood charcoal exports include the United Arab Emirates, Portugal, Lebanon, Poland and Italy.
The growth of charcoal exports from Nigeria can be attributed to several key factors. Firstly, Nigeria boasts abundant forest resources particularly in the southern regions which provide an ample supply of raw materials for charcoal production. This availability of raw materials has facilitated the expansion of the charcoal industry leading to increased exports. Secondly, economic incentives play a crucial role in driving charcoal exports. The charcoal industry provides income opportunities for many Nigerians especially in rural areas where alternative sources of employment may be limited. As such, exporting charcoal allows for the generation of foreign exchange earnings contributing to the country’s overall economic development. Furthermore, the demand for charcoal in international markets, particularly in Europe and the Middle East has played a significant role in driving exports from Nigeria.
Charcoal is valued for its high calorific value and is used for various purposes including cooking, heating and industrial processes. The growing demand for charcoal as a renewable energy source has further fuelled its export from Nigeria. In February 2023, the Nigerian government conditionally lifted the ban on the export of charcoal and processed wood. This decision aimed to revitalise businesses and boost the country’s foreign exchange earnings. The Minister of Environment, Mohammed Abdullahi, emphasised the government’s commitment to sustainable forest management and encouraged private sector investment in afforestation. Following the ban’s removal there was a notable increase in the export of wood products to Europe and Asia. The Wood Exporters Association of Nigeria (TWEAN) reported a surge in industry activity with over five million Nigerians now engaged in the wood-processing value chain. Overall, the lifting of the export ban has revitalised Nigeria’s charcoal and processed wood industry leading to increased exports and greater economic opportunities while also emphasising the importance of sustainable practises and environmental responsibility.
Charcoal exports from Nigeria serve as a critical component of the country’s economy driven by factors such as abundant raw materials, economic incentives and international demand. However, the environmental impact of charcoal production including deforestation and air pollution poses significant challenges that require proactive government regulations and sustainability efforts. Despite these challenges, the charcoal industry provides valuable socio-economic benefits including employment opportunities and income generation for rural communities.
Credebt® will continue to responsibly facilitate charcoal and other commodity export trades from Africa and Credebt Markets® is one of the solutions we bring to the table to ensure fair, ethical and profitable trades for our clients.