The National Bureau of Statistics (NBS) released a report, “Commodity Price Indices and Terms of Trade (Q1 2021)” in which the bureau stated that the all commodity group import index rose by 0.82 percent in the first quarter of 2021.
According to the report, the surge was due to an increase in the prices of mineral products, which grew by 1.53 percent, animal products 01.38 percent, and vegetables 1.24 percent.
The NBS noted that “The All commodity group import index increased by 0.82% between January and March 2021. This was driven mainly by an increase in the prices of Mineral products (1.53%), Live animals; animal products (1.38%) and animal and vegetable fats and oils and other cleavage products (1.24%).”
The report explained that the terms of trade represent 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.
“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.
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“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 statistics body said.
The NBS, however, noted that the index was adversely affected by the fall in the prices of products of the chemical and Allied industries (-0.36%) including the Wood and articles of wood, wood charcoal and articles (-0.29%).
It further stated that between February and March 2021, the all commodity group import index rose by 0.07%, as a result of an increase in the prices of Base metals and articles of base metals (0.51%), boilers, machinery, and appliances (0.50%) etc.
The index was negatively impacted by a decline in the prices of Animal and vegetable fats and oils and other cleavages (-0.54%), prepared foodstuffs; beverages, spirits, and Vinegar (-0.34%) and Plastic rubber and articles thereof (-0.19%).
