Financing to Nigeria’s agricultural sector has increased sharply, but the rise in capital has not yet produced a corresponding transformation in physical output, according to a report by Regius Capital Limited.
The report found that bank credit to agriculture increased from about N1.46 trillion at the end of 2021 to N3.81 trillion by January 2026.
It also identified approximately N1.73 trillion in agrifood capital market issuances between 2020 and the first half of 2026.
Regius Capital said the central question was no longer simply how much money was entering agriculture but where the capital was going and whether it was reaching productive parts of the value chain.
Nigeria’s agricultural gross domestic product was estimated at about N103.9 trillion in 2025, while annual household food expenditure was put at roughly N82 trillion.
The report cautioned that the increase in nominal agricultural output did not necessarily mean a similar increase in the volume of food produced because inflation, commodity prices and exchange rate changes also influenced the figures.
Nigeria recorded approximately N5.07 trillion in agricultural exports and N4.76 trillion in agricultural imports in 2025.
The report said strong export earnings could partly reflect higher global prices rather than dramatic increases in export volumes.
Continued imports, meanwhile, pointed to remaining weaknesses in domestic production and processing capacity.
Regius Capital said institutional investors generally preferred businesses with scale, audited financial records, established cash flows and reliable offtake arrangements.
That pattern has left smaller primary producers and upstream agricultural activities relatively underrepresented in formal capital markets.
The report said future progress would depend on the structure, cost and tenor of financing as much as the total volume of funds available.
It recommended special purpose vehicles, blended finance, credit guarantees, milestone based funding, longer term project debt and working capital instruments.
The report also called for mechanisms that aggregate smaller producers into larger investment platforms.
Regius Capital concluded that Nigeria’s agricultural challenge was both a shortage of suitably structured capital and a mismatch between available finance and the realities of agricultural production.
