$403bn Commodities Market: Assetium Positions To Boost Nigeria’s GDP

With the total size of the commodities market in Nigeria projected to reach US$402.90 billion in 2023, Assetium Capital Management Limited, a commodities firm, is positioning to reshape and invigorate Nigeria’s dynamic commodities sector, which has consistently played a pivotal role in contributing to country’s GDP.

With over N300 billion capital base, the company said it aspires to emerge as one of the top three commodities companies in Nigeria by the year 2030.

Speaking during the company’s unveiling in Abuja, the chairman, Dr. Abubakar Koro Muhammad, said that with commodities consistently ranked among Nigeria’s top exports, Assetium Capital is poised to fortify and deepen the commodities industry in Nigeria, thereby becoming a significant contributor to the country’s GDP.

Dr. Muhammad noted that Nigeria experienced a remarkable phase of sustained and widespread economic growth, averaging over seven per cent annually between 2000 to 2014. This growth was the result of a confluence of favorable global conditions, astute macroeconomic policies, and pivotal structural reforms undertaken during this period.

However, the economy witnessed a deceleration in growth rates between 2015 and 2022 accompanied by a stagnation in GDP per capita. This unfortunate trend, he said,  was driven by a combination of factors, including distortions in monetary and exchange rate policies, escalating fiscal deficits attributable to reduced oil production and the costs associated with a fuel subsidy program, increased trade protectionism, and external shocks such as the global COVID-19 pandemic. These challenges resulted in the deterioration of economic fundamentals, culminating in a persistently high inflation rate, reaching a 17-year peak of 25.8 per cent in August 2023

According to him, the Nigerian government has undertaken a proactive stance to attract and safeguard investments and market participants in the commodities sector with the Securities and Exchange Commission, establishing a dedicated commodity regulatory division, to organise, nurture, and oversee a structured commodities market.

“The Nigerian economy stands poised for resurgence, with an anticipated average growth rate of 3.4 per cent from 2023 to 2025. This rejuvenation is expected to be fueled by a combination of reform initiatives, a renaissance in the agriculture and services sectors, and the promise of increased government expenditure on developmental projects.

“At the heart of this impending economic renaissance lies the commodities industry, a sector that has consistently played a pivotal role in contributing to Nigeria’s GDP. In the year 2022, agriculture alone accounted for over 30 per cent of the nation’s GDP.

Furthermore, commodities have consistently ranked among Nigeria’s top exports, with the top 10 items primarily composed of diverse commodities, the chairman said.

Also speaking, chief executive of the company, Mr Kunle Awoluyi said the company is engaging in forward and backward integrations into the commodities sector.

He said the company will leverage technology to push its business to every household not just in Nigeria but across Africa and globally. With Nigeria’s over 200 million population the company will reach a wider range of people using technology.

Assetium Capital Management Limited was officially registered with the Corporate Affairs Commission (CAC) in 2019, marking its formal entry into the commodities market.

In March 2023, Assetium Capital Management Limited achieved a significant milestone by obtaining a coveted license from the Securities and Exchange Commission as a Commodity/Broker Dealer firm, further cementing its presence in the industry. The company’s foremost ambition is to establish a substantial footprint as a major player in the commodities sector. The company is dedicated to creating tangible value for its investors and ensuring that its shareholders are duly rewarded with sound returns on their investments. The company’s vision extends beyond the immediate horizon – it aspires to emerge as one of the top three commodities companies in Nigeria by the year 2030.

The company als acquired registration status with the Lagos Commodities and Futures Exchange and Afex Capital Market, both renowned as licensed commodities exchange platforms, as well as established a presence with the Nigeria Export Promotion Council (NEPC).