The Nigerian manufacturing sector is grappling with a severe inventory crisis, as the value of unsold finished goods surged to ₦1.8 trillion in the latest industry report.
Despite the Federal Government’s claims of an improving macroeconomic environment, data released by the Manufacturers Association of Nigeria (MAN) on February 9, 2026, reveals that warehouse stockpiles have reached alarming levels.
This buildup is a direct result of a sharp slump in consumer demand, as stagnant wages fail to keep pace with the rising costs of essential goods and services.
Industry experts point to “consumer resistance” as the primary driver behind the stagnant sales. As manufacturers raised prices to offset high energy costs and a volatile exchange rate, many households have been forced to prioritize spending on basic survival such as food and transport, leaving little room for non-essential manufactured products.
Financial Vanguard reports that prominent firms like Unilever Nigeria and NASCON Allied Industries have seen their inventory levels swell, turning what should be a buffer of goods into a significant financial liability funded by high-interest bank loans.
The crisis is being compounded by a strategic but risky move by many firms to stockpile raw materials as a hedge against future currency devaluations. For instance, Guinness Nigeria reportedly saw its raw materials stock rise from ₦8.7 billion to ₦39.6 billion over the last year.
While this “buying ahead” strategy protects against immediate supply shocks, it locks up critical cash flow in an environment where the average lending rate remains prohibitively high at 36.6%. The result is a double-edged sword: expensive inputs and a market that simply cannot afford the final product.
Looking ahead, the Manufacturers Association of Nigeria has warned that this backlog could lead to further factory closures and job losses if intervention is not immediate.
The association is calling for more aggressive “Nigeria First” policies to encourage government patronage of locally made goods and urgent measures to lower energy costs.
While some sub-sectors are eyeing the adoption of AI to optimize production and reduce waste, the immediate challenge remains clearing the ₦1.8 trillion mountain of goods currently gathering dust in warehouses across the country.
