Manufacturers’ Unsold Goods Rise To N1.7trn

Manufacturing companies across sectors listed on the Nigerian Exchange Limited, NGX, entered the second quarter of 2026 with combined inventories (unsold goods) of about N1.77 trillion, even as their cost of sales rose to N1.43 trillion, highlighting the growing financial pressures confronting businesses and consumers.

Financial Vanguard findings show that combined inventories increased by 10.6 per cent, Year-on-Year, YoY, against first quarter, Q1’25, which was N1.597 trillion.

Over the same period, their combined cost of sales climbed by 13.7 per cent, from N1.261 trillion to N1.434 trillion.

The figures indicate a manufacturing environment in which companies are carrying substantially more stock while simultaneously facing higher cost of producing and selling their goods.

The inventory build-up cuts across consumer goods, building materials, agriculture, food processing and other manufacturing-related businesses.

However, the data also show significant differences among companies, suggesting that inventory accumulation is being driven by a combination of factors, including production requirements, changes in demand, input costs and company-specific business conditions.

Cost of inventory

Among the companies examined, Dangote Cement had the largest inventory position at N703.58 billion in Q1’26, compared with N671.55 billion in Q1’25, representing a 4.8 per cent increase.

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

Okomu Oil Palm followed with a 90.3 per cent increase to N39.90 billion, while Livestock Feeds rose 35.9 per cent to N9.14 billion.

Inventories at PZ Cussons increased by 29.7 per cent to N69.37 billion, while Beta Glass rose by 28.8 per cent to N25.21 billion. Vitafoam’s inventory increased by 12.3 per cent to N23.20 billion.

Other companies recorded moderate increases. Lafarge’s inventory rose by 7.3 per cent to N110.64 billion, Presco increased by 3.6 per cent to N58.90 billion, while International Breweries rose by 2.2 per cent to N95.83 billion.

However, some manufacturers are recording declines in inventory.

Northern Nigeria Flour Mills recorded a 34.6 per cent decline to N31.46 billion, while NASCON Allied Industries fell by 17.1 per cent to N14.34 billion.

Cadbury Nigeria’s inventory dropped by 16.9 per cent to N27.14 billion, Unilever Nigeria fell by 7.7 per cent to N23.42 billion, Nestlé Nigeria declined by 7.3 per cent to N167.84 billion, while Nigerian Breweries fell by 6.7 per cent to N171.92 billion.

Cost of production

While inventories increased by 10.6 per cent, cost of sales expanded at a faster pace of 13.7 per cent.

If this trend is sustained, it could squeeze gross margins significantly unless manufacturers are able to pass higher production and distribution costs on to consumers through higher selling prices or achieve sufficient efficiency gains.

Dangote Cement recorded a cost of sales of N448.73 billion, up 10.2 per cent from N407.27 billion.

Nigerian Breweries recorded N233.16 billion, an increase of 7.4 per cent, while Nestlé Nigeria’s cost of sales rose by 10.8 per cent to N194.07 billion.

UACN recorded the biggest percentage increase in this dataset, with cost of sales rising by 226.8 per cent, from N41.75 billion to N136.41 billion.

PZ Cussons’ cost of sales increased by 51.1 per cent to N25.04 billion, while Champion Breweries rose by 90 per cent to N8.20 billion.

On the positive side, some companies succeeded in reducing their cost of sales. NASCON recorded a 21.1 per cent decline to N18.89 billion, while Northern Nigeria Flour Mills’ cost of sales fell by 35.9 per cent to N5.95 billion.

Okomu Oil Palm recorded a 24.5 per cent reduction in cost of sales to N11.70 billion, while International Breweries’ cost of sales declined by 9.1 per cent to N103.61 billion. Cadbury Nigeria, however, recorded a 15.4 per cent increase, while Unilever’s rose by 15.8 per cent.

Analysts’ views