NSIA plans to exit fertiliser programme

The Nigeria Sovereign Investment Authority has announced plans to withdraw from the Presidential Fertiliser Initiative, marking the conclusion of an eight-year intervention that increased the number of operational blending plants from four in 2017 to over 90 across the country.

The planned exit was disclosed at the NSIA’s 2024 Earnings Presentation and media engagement held in Abuja on Wednesday.

The Presidential Fertiliser Initiative was established to provide affordable, high-quality fertiliser to Nigerian farmers and revive the local blending industry by sourcing over 60 per cent of raw materials locally and producing at domestic blending plants.

The NSIA was appointed to implement the programme through a Special Purpose Vehicle, NAIC-NPK Limited, which managed the entire process from input procurement to fertiliser distribution.

At the start of the programme, only four blending plants were functional, but participation grew from 11 in 2017 to over 81 by the end of 2023, signalling a major revival of the industry.

The Managing Director and Chief Executive Officer of the Authority, Mr Aminu Umar-Sadiq, said the fertiliser initiative had achieved its primary objective of reviving the sector, and the NSIA’s continued involvement was no longer necessary.

“Because we have gone from four operating blending plants to over 90 today, and with the FX ban on importation lifted, it is now a liberalised sector with vibrant players. NSIA is no longer needed,” Umar-Sadiq said.

He explained that the fertiliser programme, which began in 2017, was always intended to be a temporary measure.

According to him, the Authority’s focus from inception was to stabilise the blending sector and build the capacity of private operators to take full control of the value chain.

“We started by procuring all the raw materials, transporting them to the plants, paying for blending, and then distributing the finished products,” he said. “Over time, as these companies established credible financial histories, we encouraged them to access bank guarantees to independently purchase raw materials.”

The NSIA, he said, has since reduced its role to importing only phosphate and potash, while private operators now manage logistics and procure inputs like urea and limestone.

“Our current position is limited to importing phosphate and potash,” he added, noting that within two to three years, the blending plants are expected to handle all input sourcing independently, completing NSIA’s transition out of the sector.

Umar-Sadiq said the exit plan aligns with the direction of President Bola Tinubu’s administration and would proceed unless disrupted by unforeseen market developments.

“Unless there is an unforeseen disruption in the market, the transition will be complete within the next two to three years,” he said.

Speaking on NSIA’s broader investment outlook, he said the Authority had adopted a defensive asset allocation strategy across its Stabilisation Fund and Future Generations Fund to withstand global economic uncertainty, particularly in light of political changes in the United States.

“We have allocations to private equity, hedge funds, real estate, and inflation-linked instruments. This strategy may limit upside gains when markets are bullish, but it shields the portfolio during downturns, which is critical given the savings mandate of the Sovereign Wealth Fund,” he explained.

Umar-Sadiq also said the Authority had attracted over $1bn in third-party capital for infrastructure investments, in addition to committing $500m of its own funds.

“Our financial guarantor, which we seeded with $25m, now has over $300m in capital attracted. The Nigerian Mortgage Refinance Company is also concluding a capital deal with a major global financial institution. The MedServe oncology project is near closure with a tier-one institution,” he said.

He disclosed that NSIA had received a total of $1.82bn in net government contributions since inception.

As of December 2024, the Authority’s net asset value stood at $2.84bn, approximately N4.354tn.

For the 2024 fiscal year, NSIA recorded an operating income of N1.85tn, a profit after tax of N1.88tn, and a total comprehensive income of N1.88tn.

It posted a return on average assets of 12.2 per cent and return on average equity of 12.4 per cent.

Umar-Sadiq reiterated that the NSIA remained focused on mobilising capital and stimulating long-term growth across critical sectors such as agriculture, housing, energy, and healthcare.