Global sugar prices have fallen sharply to about 30–33 cents per kilogram in 2026, down from the highs of the previous cycle, according to data on Business Insider. This has reduced Nigeria’s raw sugar import costs by roughly 15–20 percent year-on-year.
Under normal conditions, this should translate into lower retail prices. Instead, sugar continues to sell between ₦2,500 and ₦2,800 per kilogram across major Nigerian cities, with inland markets recording even higher prices.
The explanation lies in the structure of the market. Nigeria consumes between 1.4 and 1.6 million metric tonnes of sugar annually, yet more than 90 percent of that demand is met through imports. This makes local pricing highly sensitive not to global sugar prices alone, but to currency movements and domestic cost pressures.
Why Prices Are Stable Even as Inflation Eases
Nigeria’s inflation, measured by the Consumer Price Index, has begun to moderate, settling around 15 percent according to last report from Nigerian Bureau of Statistics. However, sugar prices have not declined in line with this trend.
The reason is straightforward. While global sugar has become cheaper, the naira’s depreciation has offset much of that gain in local currency terms. At the same time, rising energy, logistics, and financing costs have pushed total industry input costs to an estimated ₦1.45 trillion.
This has created a pricing environment where sugar is no longer rising as fast as overall inflation, but is also not falling. Instead, prices have become “sticky,” reflecting cost recovery strategies by producers rather than changes in global supply.
For dominant players like Dangote Sugar Refinery and BUA Foods, this has opened a rare window of margin expansion. Lower dollar-denominated input costs combined with stable domestic prices have improved profitability in the short term.
Why Sugar Prices Could Climb Above ₦3,000/kg
Beneath this temporary stability, the conditions for another price increase are already forming.
First, the global sugar market is expected to tighten. The current surplus is projected to narrow significantly, with the possibility of a deficit emerging by 2027. This would push international prices upward.
Second, Nigeria remains exposed to foreign exchange volatility. Any further weakening of the naira would immediately raise the cost of imported raw sugar, regardless of global price trends.
Related – 5 Deep Signals from Nigeria’s February 2026 Inflation Report Investors Should Not Ignore
Third, structural dependence on imports persists. Despite policy efforts led by the National Sugar Development Council, local production still accounts for less than 5 percent of national demand. The import-refine model continues to dominate because it offers faster and more predictable returns than large-scale agricultural investment.
When these factors combine, the likely outcome is a gradual but firm increase in domestic prices. Under a base-case scenario, sugar prices are expected to rise by 10 to 20 percent over the next 12 to 18 months, pushing retail levels toward or slightly above ₦3,000 per kilogram by 2027. In a weaker currency scenario, the increase could be sharper.
BuyerMetrics Bottom Line
Nigeria’s sugar market is entering a two-speed phase where short-term stability masks medium-term risk.
In the current phase, sugar prices are rising more slowly than inflation, creating a temporary affordability plateau for consumers and a profit window for refiners. But this phase is unlikely to last.
As global supply tightens and currency pressures persist, sugar prices will begin to move upward again, reasserting their sensitivity to macroeconomic conditions.
Until Nigeria produces a meaningful share of its own sugar, the commodity will remain less a function of agriculture and more a reflection of the naira.
