Manufacturers’ Unsold Goods Jump 10.6% to N1.77trn In Q1

Manufacturing companies listed on the Nigerian Exchange Limited (NGX), entered the second quarter of 2026 with combined unsold inventories of about N1.77 trillion, a 10.6 per cent year-on-year increase from N1.597 trillion recorded in Q1, 2025.

The inventory build-up came even as cost of sales climbed faster, rising 13.7 per cent YoY to N1.434 trillion from N1.261 trillion, highlighting growing financial pressures confronting businesses and consumers.

Analysis of Q1, 2026 financial results shows the inventory glut cuts across consumer goods, building materials, agriculture, food processing and other manufacturing-related businesses. The data also reveal significant differences among companies, suggesting the accumulation is being driven by a mix of production requirements, demand changes, input costs and company-specific conditions.

Dangote Cement recorded the largest inventory position at N703.58 billion in Q1 2026 compared with N671.55 billion in Q1 2025, representing a 4.8 per cent increase.

UACN posted one of the sharpest increases, with inventories rising 231.8 per cent to N189.55 billion from N57.13 billion.

Other major increases were recorded by Okomu Oil Palm, up 90.3 per cent to N39.90 billion; Livestock Feeds, up 35.9 per cent to N9.14 billion; PZ Cussons, up 29.7 per cent to N69.37 billion; and Beta Glass, up 28.8 per cent to N25.21 billion.

Lafarge’s inventory rose 7.3 per cent to N110.64 billion, Presco increased 3.6 per cent to N58.90 billion, while International Breweries was up 2.2 per cent to N95.83 billion.

However, some manufacturers recorded declines. Northern Nigeria Flour Mills fell 34.6 per cent to N31.46 billion, NASCON Allied Industries dropped 17.1 per cent to N14.34 billion, and Cadbury Nigeria declined 16.9 per cent to N27.14 billion.

Unilever Nigeria fell 7.7 per cent to N23.42 billion, Nestlé Nigeria declined 7.3 per cent to N167.84 billion, while Nigerian Breweries fell 6.7 per cent to N171.92 billion.

While inventories rose 10.6 per cent, cost of sales expanded faster at 13.7 per cent.

Analysts warn that if sustained, the trend could squeeze gross margins unless manufacturers pass higher costs to consumers or achieve efficiency gains.

Dangote Cement’s cost of sales rose 10.2 per cent to N448.73 billion. Nigerian Breweries recorded N233.16 billion, up 7.4 per cent, while Nestlé Nigeria’s cost of sales rose 10.8 per cent to N194.07 billion.

UACN recorded the biggest jump, with cost of sales rising 226.8 per cent to N136.41 billion. PZ Cussons’ cost of sales increased 51.1 per cent to N25.04 billion, while Champion Breweries rose 90 per cent to N8.20 billion.

President of the Chartered Institute of Stockbrokers (CIS), Fiona Ahimie, said the inventory rise reflects both supply and demand factors.

“Many manufacturers increased production as operating conditions became more stable and FX access improved. However, demand has not expanded at the same pace because prices remain elevated relative to household incomes,” she said.

MD of Highcap Securities, David Adonri, blamed inflation and declining purchasing power, while Olatunde Amolegbe of Arthur Steven Asset Management cited restrictive monetary policy with MPR at 26.5 per cent as constraining consumption and inventory financing.

The experts called for improved power supply, lower financing costs, policy consistency, and measures to boost real incomes to stimulate demand and help manufacturers clear stock.