The National Bureau of Statistics (NBS) on Wednesday reported that Nigeria’s all commodity export price index between January and June this year rose by 11 percent.
The Bureau in its latest Commodity Price Indices and Terms of Trade Q2, 2018 linked the growth in export commodity price index to improved exports of mineral products, wood products, live animals and vegetable products.
According to the official statistics producing and reporting agency, the All commodity group export index rose 6.7 percent in February and advanced 0.1 percent in March. However, the index fell 3.9 percent in April, climbed 10 percent in May but decreased by 1.7 percent at the end of June.
Comparatively, the nation’s all commodity group import price index rose by two percent during the review period and was driven largely by miscellaneous manufactured articles
The NBS reported that in February, the all commodity group import index rose by 1.0 percent but fell by 1.3 percent in March. Again, the index was reported to rise by 2.5 percent in April, and the average commodity prices were up 0.01 percent in June compared to the preceding month’s prices.
The Bureau stated further that based on the export-import indices in the six month period under review, the nation’s all products terms of trade (TOT) index rose by 9 percent driven by mineral products.
In addition, it reported that while all region group export index rose by 9 percent as a result of trade with The Americas region, the all region group import index fell by 2 percent as a result of trade with Oceania region, leaving the all region terms of trade to grow by 11% as a result of trade with the Americas.
The agency stated further that in Q2 2018, Nigeria’s top five trading partner countries were Belgium, China, Spain, the Netherlands and India.
It pointed out that in the report that the major export from Nigeria to these countries was crude petroleum and natural gas while the major import from these countries was motor spirit (ordinary).
The terms of trade (TOT) represents 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 NBS stated that the terms of trade for Nigeria are calculated as the value of its exports as percent of the value of its imports.
It clarified further: “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 and vice versa. The TOT is recorded as an index, and can be used as an indicator of an economy’s health”, the NBS added.
