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Raw materials and their uses

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Raw materials and their uses

  1. 1. i RAW MATERIALS SOURCING FOR MANUFACTURING IN NIGERIA (4TH EDITION) RMRDC SURVEY SERIES 061 NOVEMBER, 2009 Editors: Onwualu, A.P., Abdullahi, A.K Jolaoso, M.A., Mbuk, M.I., Olife, I.C.
  2. 2. ii Publisher Raw Materials Research and Development Council (RMRDC) No 17, Aguiyi Ironsi Street Maitama District P.M. B. 232, Garki Abuja Tel: 07098213090, 07098213091 e-mail: ceo@rmrdc.gov.ng website: http/www.rmrdc.gov.ng Copyright  RMRDC, 2009 All Rights Reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means of electronics, mechanical, photocopying, recording or otherwise without prior permission in writing from the copyright owner. Typesetting and graphics Desktop Publishing Unit Documentation and Publishing Division Raw Materials Research and Development Council, Abuja. ISBN: 978-978-50868-1-2
  3. 3. iii EDITORIAL COMMITTEE 1. Prof. Onwualu A.P. 2. Dr. Abdullahi A.K. 3. Dr. Jolaoso M.A. 4. Mrs. Mbuk M.I. 5. Miss Olife I.C.
  4. 4. iv TABLE OF CONTENT Title page i Table of content iii Foreword vi Acknowledgement vii List of tables viii List of abbreviations xi CHAPTER ONE 1.0 Introduction 1 1.1 Structure of the Report 2 1.2 Members of the Committee 2 CHAPTER TWO BASE METAL, IRON & STEEL AND ENGINEERING SERVICES SECTOR 2.1 Introduction 4 2.2 Raw Materials Requirements in the Sector 4 2.3 Raw Materials Requirements on Sub-Sectorial Basis 4 2.4 Specifications of Raw Materials for Iron and Steel Production 12 2.5 Coke Blend/Coke/By-Products 13 2.6 Oxide Pellet/Sinter 14 2.7 Limestone/Dolomite 14 2.8 Specifications for Foudry Molding Sands 16 2.9 Investment Opportunites in the Sector 18 2.10 Research and Development in the Sector 19 2.11 Challenges and Opportunites 20 2.12 Government Policies Affecting the Sector 21 2.13 Conclusion 21 2.14 Recommendation 21 CHAPTER THREE CHEMICAL AND PHARMACEUTICALS SECTOR 3.1 Introduction 23 3.2 Raw Materials Requirements and Sourcing 24 3.3 Soap and Detergent Sub-Sector 24 3.4 Capacity Utilization Profile 24 3.5 Potential for Local Substitutes 43 3.6 Industries Operating in the Sector 44 3.7 R & D Activities in the Sector 45 3.8 Recommendations 45 CHAPTER FOUR ELECTRICAL AND ELECTRONICS SECTOR 4.1 Introduction 48 4.2 Raw Materials Requirement 48 4.3 Industries Operating in the Sector 4.4 R & D Activities and Facillities in the Sector 58
  5. 5. v 4.5 General Observation 61 4.6 Recommendations 62 CHAPTER FIVE FOOD, BEVERAGES AND TOBACCO SECTOR 5.1 Introduction 64 5.2 Sugar 64 5.3 Quality Specifications of Raw Materials 65 5.4 Bakery 71 CHAPTER SIX MOTOR VEHICLE AND MISCELLANEOUS SECTOR 6.1 Introduction 74 6.2 Raw Materials Requirements in the Sector 74 6.3 Installed Capacity and Capacity Utilization 76 6.4 Raw Material Sourcing/Local Availability 77 6.5 Potential for Local Substitution 77 6.6 Recommendations 79 CHAPTER SEVEN NON METALLIC MINERALS SECTOR 7.1 Introduction 80 7.2 Raw Materials Requirement 80 7.3 Specification of some Non-Metallic Mineral Raw Materials 93 7.4 Capacity Utilization 99 7.5 Industries in Operation 105 7.6 Additional Industries Required to Meet the Existing National Demand 105 7.7 Research and Development 106 7.8 Summary of Processing Technology of some Non-Metallic Minerals 106 7.9 Fiscal Policy 106 7.10 Problems and Challenges 106 7.11 Conclusion 107 7.12 Recommendations 108 CHAPTER EIGHT DOMESTIC AND INDUSTRIAL PLASTICS, RUBBER AND FOAM SECTOR 8.0 Introduction 110 8.1 The Plastic Sub Sector 110 8.2 The Petrochemical Industry 111 8.3 The Tyre Sub-Sector 112 8.4 Industries Operating in the Sector 115 8.5 Industries that could be Established 115 8.6 Raw Materials that could be Developed or Sourced Locally 116 8.7 Raw Materials Specification 116 8.8 R & D Activities in the Sector 122 8.9 Raw Materials Process Technology, Machinery and Products 122 8.10 Fiscal Policies Affecting the Sector 127 8.11 Recommendations 129
  6. 6. vi Appendix 132 CHAPTER NINE PULP, PAPER, PAPER PRODUCT, PRINTING AND PUBLISHING SECTOR 9.1 Introduction 133 9.2 Primary Paper Mills 134 9.3 Raw Materials Used in the Sector 134 9.4 Industrial Specifications of Raw Materials in the Sector 139 9.5 Capacity Utilization Profile 142 9.6 Short Fall for Major Raw Materials in the Sector 144 9.7 Potentials for Local Substitute 146 9.8 Investment Opportunities 147 9.9 Research and Development Activities in the Sector 149 9.10 Machinery/Equipment Engaged for Processing Raw Materials in the Sector 151 9.11 Recommendations 153 CHAPTER TEN TEXTILE, WEARING APPAREL, LEATHER AND LEATHER PRODUCTS SECTOR 10.1 Introduction 155 10.2 Raw Materials Requirement and Utilization 160 10.3 Products 162 10.4 Cottage Tanning/Footwear and Leather Goods Industries 165 10.5 Machinery 166 CHAPTER ELEVEN WOOD AND WOOD PRODUCTS SECTOR 11.1 Introduction 174 11.2 Raw Materials Requirements in the Sector 175 11.3 Sources of Roundwood (Logs) 177 11.4 Adhesives 178 11.5 Basic Chemicals used in Resins 179 11.6 Industrial Chemicals 179 11.7 Overlays 179 11.8 Availability of Local Raw Materials that could be Developed and Used by the Industries in the Wood and Wood Products Sector 180 11.9 Industries Operating in the Sector 184 11.10 Investment Opportunities in Wood and Wood Products Sector 185 11.11 Research and Development Activities in the Sector 186 11.12 Machinery and Equipment Required in the Sector 188 11.13 Conclusion 190 11.14 Recommendation 198
  7. 7. vii FOREWORD When in the middle of the 1980’s Nigeria discovered that the national economy was experiencing some difficulties, the Structural Adjustment Programme was introduced in 1986 to diversify the nation’s economy and make it less dependent on petroleum whose price in the international market was unpredictable. This brought about some challenges, among which was the devaluation of the naira, that made importation of the needed raw materials and machinery difficult. In response to these challenges, the Council was established by the Act. No. 39 of 1987 to expedite industrial development through optimal utilisation of local raw materials as inputs for our industries. In order for the Council to achieve its mandate of “reviewing from time to time raw materials resources availability and utilisation with a view to advising the Federal Government on the strategic implication of conservation, exploitation, depletion or stockpiling of such resources”, techno-economic survey of Nigeria’s natural resources was introduced in 1989, with a view to identifying gaps in raw materials sourcing, utilization and development. The 1989 survey report was updated in 1992, 1996, 1999/2000, 2003 and 2006 so as to provide periodic and current data on raw materials development and utilisation. Over the period, the information collected was always analysed, produced and disseminated to prospective investors, researchers and the general public through the Raw Materials Information System (RMIS) and website (http/www.rmrdc/gov.ng). The reports, which are based on the ten sectors of the Manufacturers Association of Nigeria (MAN), are usually synthesized into a single publication titled” Raw Materials Sourcing for Manufacturing in Nigeria”. The 1st, 2nd and 3rd editions of the publication were produced in 1990, 1993 and 1997 respectively. This edition is the fourth in the series. The objective of the publication is to provide vital information on raw materials sourcing for existing industries in the ten sectors, their capacity utilization, raw materials specifications, potentials for local substitutes in the sectors, industries operating in the sectors, research and development activities, among others. The report differs with the previous editions in that raw materials specifications in the sub-sectors were added to assist raw materials suppliers. Also the report focused on only 3 sub-sectors in each of the ten sectors. This is aimed at giving more detailed information on the sub-sectors of MAN. It is hoped that the information in the publication would assist existing manufacturers and prospective investors with necessary information that would enable them make informed decisions on the use of local raw materials to enable the Country save its scarce foreign exchange. Engr. (Prof.) P. A. Onwualu. FAS Director General/Chief Executive Officer
  8. 8. viii ACKNOWLEDGEMENT The Committee wishes to express deep appreciation to the management of the Raw Materials Research and Development Council (RMRDC) for the opportunity given to its members to participate in this very important assignment. Our sincere gratitude particularly goes to the Director-General for his total support throughout the duration of the assignment. The Committee alsi extends its gratitude to all those who gave their secretarial contributions, especially Mr. Mike Dimkpa for typesetting the work. Our appreciation also goes to all those who contributed in one way or the other to make this project a success. Dr. A.K. Abdullahi Committee Chairman
  9. 9. ix LIST OF TABLES Table 2.1 Raw Materials and Status of Industries in Base-Metal Sub-Sector. Table 2.2 Major Iron Ore Deposits in Nigeria. Table 2.3 Raw Materials Available in the Country Table 2.4 Raw Materials Imported Table 2.5 Raw Materials Available Locally but Imported Table 2.6 Some of the Additional Industries Needed to Make the Existing Industries Self Reliance Table 3.2.1 Capacity Utilization of Raw Materials: Soap and Detergent Sub-Sector Table 3.2.2 Capacity Utilization of Raw Materials: Agro-Chemicals and Fertilizers Table 3.2.3 Capacity Utilization of Raw Materials: Pharmaceuticals Sub Sector Table 4.1 Sub-Sector: Electrical Bulbs, Lamps and Accessories Table 4.2 Sub-Sector: Electrical Power Control Table 4.3 Sub-Sector: Cables and Wire Table 4.4 Sub-Sector : Electrical Bulbs, Lamps and Accessories Table 4.5: Electrical and Electronics: Basic Raw Materials Available in Nigeira and their Locations Table 4.6 R & D activities in Nigerian Research Institute Table 5.1 Import Duty Profile of Selected Raw Materials (2008-2012) Table 5.2 Raw Material Requirements Table 5.3 Average Capacity Utilization in Bakery Industries Table 6.1 Vehicle Body Component & Technology Situation Table 6.2 Summary of Component, Raw Materials and Technology Existing and Possible Manufacturers for Engine and Transmission Table 7.1 Major Raw Materials Used by the Sub-Sectors Table 7.2 Non-Metallic Raw Materials Used by the Sub-Sectors and their Source Table 7.3 Raw Materials Requirement by the Industries Table 7.4 Occurrence, Development and Proven Reserves of some Non-Metallic Minerals Raw Materials in Nigeria Table 7.5 Product Specification for Kaolin in Industries Table 7.6 Product Specification for Ball Clay Table 7.7 Industrial Specifications for Barites Table 7.8 Specifications of Feldspar for Ceramic Industry Table 7.9 Specification of Gypsum in Chalk, P.O.P and Ceramics Table 7.10 Industrial Specification for Talc Table 7.11 Qualitative Classification of Quartz/Silica Sand Table 7.12 Specifications for Marble/Limestone Table 7.13 Industrial Specification of Calcium Carbonate for Cement, Fertilizer and Glass Production Table 7.14 Average Operating Capacities of the Industries in the Non-Metallic Mineral Products Sector
  10. 10. x Table 7.15 Summary of Processing Technology of some Non-Metallic Minerals Table 8.1 Raw Materials for the Plastic Sub-Sector Table 8.2 Raw Materials for Rubber Sub-Sector Table 8.3a Petroleum-Based Raw Materials Table 8.3b Agro-Based Raw Materials Table 8.3c Chemical-Based Raw Materials Table 8.4 Raw Materials for the Plastics Sub-Sector Indicating Full Capacity Requirements, National Demand, Current Capacity, and Shortfall for 2006. Table 8.5a Capacity Utilization for Plastic Products Table 8.5b Capacity Utilization for Tyres and Tubes Table 8.6 Table 8.7 Polystyrene Sheets Table 8.7 Table 8.8 Summary of Processing Facts in the Plastic Industry Table 8.9 Table 9.1 Raw Materials Requirement of Pulp, Paper, Paper Products, Printing & Publishing Sector Table 9.2 Industrial Specifications of Raw Materials in the Sector Table 9.3 Summary of Average Capacity Utilization in the Pulp, Paper, Paper Products, Printing and Publishing Sector. Table 9.4 Capacity Utilization in the Pulp, Paper, Paper Products, Printing and Publishing Sector 2003 – 2006 Table 9.5 Most Important Raw Materials of the Pulp, Paper, Paper Products, Printing and Publishing Sector (demand-supply gap) Table 9.6 Investment Opportunities in Paper, Paper Products, Printing and Publishing Sector Table 9.7 Research and Development Activities in Nigerian Institutions/ Industries Table 9.8 List of Machinery and Equipment for the Sector (Paper Industry) Table 10.1 Raw Materials Requirement for Wearing Apparel Industry Table 10.2 Livestock Population Figures in Nigeria Table 10.3 Common Products of the Wearing Apparel Industry Table 10.4 Major Leather Exporters in Nigeria for the Year 2005 Table 10.5 Production Activities of Cottage Tanning Industries in Kano Table 10.6 Production Activities of Cottage Leather Retaining, Dyeing and Finishing Industries in Kano Table 10.7 Production Activities of Cottage Leather Products Industries Table 10.8 List of Raw Materials Requirements for the Tanning Industry Table 10.9 List of Raw Materials Requirements for the Footwear and Leather Goods Industries Table 10.10 Consumer Price Indices for Clothing and Footwear Table 10.11 List of Industries with Linkages with Leather and Leather Products Table 11.1 Research and Development Activities in Nigeria Table 11.2 Major Raw Materials Utilized in the Sector Table 11.3 Raw Materials and Industries
  11. 11. xi Table 11.4 Wood Requirement of Industries Table 11.5 Geographical Distribution of Forest Lands and Timber Stocking in Nigeria: 1988 Table 11.6 Kaolin Occurrence and Deposits in Nigeria
  12. 12. xii LIST OF ABBREVIATIONS AAD Agro and Agro-allied Deparment AGOA African Growth Opportunity Act ARCEDEM African Regional Centre for Engineering Design and Manufacture ASW Augmented Spherical Wave AT&P African timber & plywood BOF Basic Oxygen Furnace CBN Central Bank of Nigeria CKD Completely Knocked Down CPD Chemical & Pharmaceutical Division CD Computer Division D Director DD Deputy Director DRF Drug Revolving Fund EAF Electric Arc Furnace ECAC East and Central African Countries EEG Export Expansion Grant FDI Foreign Direct Investment FBD Food & Beverage Division FRIN Forestry research Inst. Of Nigeria FSM Fixed Spin moment GDP Gross Domestic Product KRPC Kaduna Refinery and Petrochemicals Company LDL large diameter logs LNG Liquidified Natural Gas MAN Manufacturers Association of Nigeria MF melamine formaldehyde MFA Multi-fiber Arrangement MT Metric ton MTF-EE Multidisciplinary Task Force – Electrical and Electronics N/A Not Available NIPRD National Institute for Pharmaceutical Research and Development NIPP National Integrated Power Programme NARICT National Research Institute for Chemical Technology NIPRD National Institute for Pharmaceutical Research and Development NMC Newsprint Manufacturing Company NNMDA National Medicine Development Agency NNPC Nigerian National Petroleum Corporation NPM Nigerian Paper Mills Ltd NISPRI Nigerian Stored Products Research Institute OCIL Organic chemical Industries Ltd OEM original equipment manufacturers PKO Palm Kernel Oil
  13. 13. xiii PF phenol formaldehyde PHCN Power Holding Company of Nigeria PRODA Projects Development Agency PPPPP Pulp, Paper, Paper Product, Printing and Publishing sector RADAMA Refrigeration, Air conditioning and Domestic Appliances SAP Structural Adjustment Programme SKD Semi-Knocked-Down SMEs Small and Medium Enterprises SON Standards Organisation of Nigeria TAM Turn Around Maintenance UPS Uninterrupted Power Supply UNIDO United Nations Industrial Development Organization UBE Universal Basic Education system UF Urea Formaldehyde UDU Usmanu Danfodiyo University VAT Value Added Tax WTO World Trade Organization
  14. 14. 1 CHAPTER ONE INTRODUCTION 1.0 The Raw Materials Research and Development Council (RMRDC) was established by Act No. 39 of 1987 with the broad mandate to promote, support and expedite industrial development and self-reliance through optimal utilization of local raw materials as inputs to the industries. Among the seven specific mandates of the Council, three, which are directly linked to the need for Techno-Economic Survey are:  to draw up policy guidelines and action programmes on raw materials acquisition, exploitation and development;  to review, from time to time, raw materials resources availability and utilization, with a view to advising the Federal Government on the strategic implications of depletion, conservation or stock-piling of such resources;  to advise on adaptation of machinery and processes for raw materials utilization. In pursuance of these mandates, the Council commissioned Committees on its first Techno- Economic Survey of Nigeria’s natural resources and their industrial potentials in 1988. The cardinal objective of the survey, which covered all the industrial sub-sectors of the economy, as classified by the Manufacturers Association of Nigeria (MAN), was to gather information on locally available raw materials, technology and raw material requirements and capacity utilization of the manufacturing industries. The survey also covered the conversion of locally sourced raw materials into industrial inputs and the dissemination of information to stakeholders. In order to consolidate on the gains of this exercise and update the data collected in the first survey, which was concluded in 1989, the Council organized other surveys in 1992, 1996, 2000, 2003 and 2006. However, in 2007, the Council was restructured through which a new organogram emerged. The new structure placed the responsibility of conducting Techno- Economic Surveys on the various technical departments. Consequently, a Committee was constituted to review the Survey programme with a view to improving subsequent exercises. The Committee was set up with the following Terms of Reference: i. Review the Techno-Economic Survey/ Industrial Study Programmes of the Council ii. Review previous modalities of the exercise iii. Develop alternative modalities to enhance the quality of the exercise iv. Redesign the programme to make it contribute to government policies v. Recommend ways of reducing respondent apathy during surveys/ industrial studies vi. Make any other recommendation to enhance the quality of the programme.
  15. 15. 2 In order to provide comprehensive information on raw materials sourcing covering all the ten sectors, the maiden publication tagged “Raw Materials Sourcing for Manufacturing in Nigeria” was produced in 1990. The publication was updated in 1993 and 1997. This edition, which is the fourth in the series, is synthesized 2006 reports of the ten sectors of MAN. 1.1 STRUCTURE OF THE REPORT As in the 3rd edition, in this edition information is presented based on the ten sectors of MAN. However, the presentation is more concise and focused. Specifically the report is structured as follows:  Introduction;  Raw Material Requirements;  Raw Material Sourcing;  Raw Materials Specification;  Capacity Utilization;  Raw Materials Shortfall;  Potentials for Local Substitutes;  Industries operating in the Sector;  Investment Opportunities in the sector;  Research and Development Activities;  Fiscal Policies; and  Recommendations 1.2 MEMBERS OF THE COMMITTEE 1. Dr. A.K. Abdullahi D(AAD) Chairman 2. Engr. F. Folarin Okuribido DD(MVMD) Member 3. Alh. U.A. Hassan DD(TLD) “ 4. Mr. B.A. Aluko DD(FBD) “ 5. Mrs. M. I Mbuk DD(PRFD) “ 6. Mr. E.A. Asanga DD(CPD) “ 7. Engr. G. Ladan DD(IED) “
  16. 16. 3 8. Mr. K.O. Biliaminu DD(MD) “ 9. Dr. M.A. Jolaoso DD(ICSD) “ 10. Dr. A.A. Ogunwusi DD(WPPD) “ 11. Dr. D.M. Ibrahim DD(NOC) “ 12. Mr. C.C. Okeke DD(CD) “ 13. Dr. M.L. Buga DD(FBD) Member/Sec. 14. Mr. S.S. Onjewu ACSO(FBD) Asst. Secretary 15. Miss. I.C. Olife SOI(FBD) Asst. Secretary
  17. 17. 4 CHAPTER TWO BASE METAL, IRON & STEEL AND ENGINEERING SERVICES 2.1 Introduction: The Industrial Studies on Base Metal, Iron and Steel, and Engineering Services Sector which was updated in 2006 was aimed at evaluating the availability of local raw materials in the Foundry and Iron and Steel sub-sectors. The studies were aimed at providing data on raw materials requirements for the existing industries, process technology, priority areas for research and development activities, resource-based investment opportunities, and areas required for capacity building in the fabrication of plants, machinery as well as production of spare parts. However, the data analyzed was affected by low return of administered questionnaires attributed to the following factors:-  Apathy toward the study  Obsolete equipment and machinery  Lack of working capital and difficulty in accessing bank loans for long-term investment  Fear of divulging trade secrets to other competitors in the sector  High tariff on spare parts machinery and consumables  Business closures as a result of hard economic environment  In adequate infrastructural facilities. As a result of these factors most of the key players in the Sector refused to appropriately respond to critical questions raised in the study. Therefore, most of the analyses carried out were based on scanty and secondary data obtained during the 2006 update of industrial studies on Base Metals, Iron and Steel, and Engineering services Sector. However in this synthesis an overview of the status of four (4) sub-sectors, viz. Base Metals, Iron and Steel, Foundary and Welding Electrodes is given together with the problems and challenges as they relate to raw materials, machinery and equipment, process technology, R&D activities and fiscal policy. 2.2 Raw Materials Requirements in the Sector: The raw materials required in the sector are mainly metallic ores that were classified into ferrous and non-ferrous ores. Ferrous ores are usually utilized as primary raw materials for Iron and Steel production, while the non-ferrous are used as base metals for production of different types of alloys required in the sector. Metallic ores include iron ores, columbite, nickel, casserite (tin ore), wolfram (tungsten ore), molybderite (molybdenum ore) galena (lead ore), vanadium, sphalerite tourmaline, chromite (zin ore), gold, zircon, magnesite, ilmenite, e.t.c. Most of these ores and other raw materials such as coal, fluxes and refractory required in the Iron and Steel production have been found to occur in commercial quantities in many parts of Nigeria. Reserve estimates of some of the mineral ores available in Nigeria are presented in table 2.1, while detailed raw materials
  18. 18. 5 required in the sector at full and current capacities from 2003 to 2006. And this shortfall of 6,178, 997 to 3,167, 726 3,011,271 respectively over a period of 4 years. 2.3 Raw Material Requirements on Sub-Sectoral Basis More than ninety (90) percent of raw materials used in the Iron and Steel, Foundries and Welding Electrodes sub-sectors are imported, even though some of them can be sourced locally with appropriate technology and production methods. However, raw materials required by each of the sub-sector are presented as follows: 2.3.1 Base Metals sub-sector Base metals are non-ferrous metals such as aluminum, copper, lead, zinc, tin, gold, manganese columbite, nickel, tourmaline, chromites, e.t.c, while some of these metals can be used in their natural forms, others are used as alloys. In recent times, non-ferrous metals and alloys are significantly contributing to global technological development. Focus of activities in this sub- sector had been mostly on tin, a metal for which Nigeria has attained international standing in the early ‘70s. Some of the available local raw materials and other activities are presented below: Table 2.1: Raw Materials and Status of Industries in Base-Metal Sub-Sector. S/N BASE METAL DEPOSIT [STATE] PROVEN RESERVE [MT] REMARKS INDUSTRY AND STATUS Name Status 1 Aluminum Benue, Delta, Ekiti, Enugu, Kebbi, Taraba, N/A Exploration 1. ALSCON 2. Private Mills About to be rehabilitated after privatization Functional 2 Tin Bauchi, Cross River, Ekiti, Kaduna, Kano, Niger, Plateau, Nassarawa, Taraba, FCT 300,000 Mining in progress Makeri Smelting Co. Ltd., Jos Reorganization/ rehabilitation 3 Lead and Zinc Bauchi, Benue, Cross River, Ebonyi, Imo, Kano, Plateau, 20,000 Legal/illegal mining in progress - - 4 Gold Cross River, Edo, Kaduna, Katsina, Kebbi, Niger, Osun, Zamfara, N/A Organized gold mining going on - - 5 Copper Bauchi, Edo, Enugu, Kano, Niger, N/A - - - 6 Silver Ebonyi, Gombe, Osun N/A Associated with gold, lead and zinc - - 7 Manganese Cross River, Kaduna, Katsina, Kebbi, 300,000 Illegal mining in progress - - 8 Titanium Plateau, Kaduna Associated with tin ore. Presently waste in tin extraction. - - Source: RMRDC.
  19. 19. 6 2.3.2: Iron and Steel sub-sector Most of the operators in the sub-sectors are process equipment fabricators, spare parts producers, welders, steel furniture, doors, windows and burglary-proof fabricators. Some of the essential raw materials and consumables required in the sub sector are Iron Ore, Coking Coal, Limestone, dolomite, refractory bricks, Ferro-alloys, Iron and Steel Scrap, natural gas and billets. Major Iron ore deposits in Nigeria are presented in Table 2.2. Table 2.2 Major Iron Ore Deposits in Nigeria. STATE LOCATION % FE PROVEN RESERVES [MILLION TONNES] REMARKS Kogi Agbaja Itakpe Bass Nge Agbado-Okuda Ajbanoko Chokochoko Fatti Koton-Karfe 45 – 54 38 – 45 43 – 49 38 – 43 40 35 46 43 - 53 1,159 200 – 300 4,000 60 60 20 37 803 UI Mining in progress -do- -do- -do- -do- -do- -do- Plateau Muro Hills 32 N/A UI Bauchi Rishi Gamawa 10 – 19 40 – 45 N/A N/A G UI Kebbi Darkin-Gari 37 N/A UI Anambra Nsude Hills 43 – 50 65 UI Source: Oyeyinka et al [1997] KEY UI = Under investigation N/A = Not available G = Only geological confirmation of ore presence 2.3.3. Foundaries The Foundry sub-sector provides base for production of industrial components, spare parts, equipment and machinery. Most of the foundries in Nigeria deal with iron castings, low quality aluminum, brass, bronze and copper. The main raw materials required are scrap, pig Iron, coke, ferro-silicon ferro-manganese, limestone, silica sand, bentonite and sodium silicate. Iron castings are made from scraps such as (engine blocks, crank shafts, etc), while for non-ferrous castings, usually aluminum, copper, brass and tin are required. The major material inputs for the foundry industry include:  Feedstock for melting pig iron, cast Iron Scrap, Steel Scrap, ferro-alloys, copper and its alloys, aluminum scraps, ingot, fluxes, etc.  Molding materials – foundry sands, bentonite, binders  Refractory lining materials, crucibles and other consumables. 2.3.4. Welding Electrodes Welding electrodes are widely used in Base Metal, Iron and Steel and Engineering Services Sector. Electrodes contain various minerals which remove impurities during welding and protect weld area from oxygen and nitrogen, etc. Some minerals used in its production which
  20. 20. 7 are locally available in Nigeria include rutile, fluorspar, limestone, silica, mica, feldspar, bentonite and kaolin. Although most of these raw materials required for production of welding electrodes are locally available, only limestone and feldspar are being commercially exploited in the Country. Most of other mineral deposits are either under investigation or yet to be quantified, and thus major raw materials required in the sub-sector are imported. Table 2.3: Raw Materials available in the Country SUB-SECTOR: IRON AND STEEL S/N RAW MATERIALS UNIT OF MEASUREMENT UNIT COST (N) 2006 1. Stainless Steel Sheets Mt 30,000 2. Stainless Steel Bars Mt 6,300 3. Cast Iron Mt 6,500 4. Mild Steel Sheets Mt 11,000 5. Iron Rods Mt 15,000 6. Angle Iron Mt 6,000 7. Iron Pipes Mt - 8. Iron Channels Mt - 9. Mild Steel Rods Mt - 10. Stainless Steel Rods Mt - 11. Hot Rolled Coil Mt 60,000 12. Paints Litres/Gallons - 13. U-Channels Mt - 14. Iron Coil Mt 110,000 15. Medium Carbon Rods Kg 32,000 16. High Carbon Steel Rod Kg 33,000 17. Steel Pipes Mt - 18. Electrodes - 19. U-Channels Lengths - 20. Galvanized Iron Sheets Mt - 21. Galvanized Wire Rolls - 22. Oxygen/Acetylene Gas M3 200/m3 23. Galvanized Pipes Mt 15,000 24. Galvanized Steel Sheets Pieces 3,500 25. Bolts & Nuts Pieces - 26. Steel Pipes 27. Ferrous Materials Pieces 7,500 28. Non Ferrous Materials Pieces 7,500 29. Flat Bars Lengths 6,000 30. Iron Ore Mt - 31. Copper Sheets Mt - 32. Brass Plate Mt - 33. Galvanized Iron Pipes Mt - 34. Angle Iron Pieces 2,250.00 35. Flat Sheets “ 2,700.00 36. Rods “ 1,850.00 37. Channels “ 2,200.00 38. Electrodes “ 1,800.00 39. Steel Pipe Kg 3.300.00 40. Steel Pan “ 5,000.00 41. Aluminum “ 5,550.00
  21. 21. 8 42. Mild Steel Pieces 3,600.00 43. Flat Bar Mt 300 44. Galvanized Pipes “ 1,200.00 45. Angle Irons Lengths/M 2000 – 3000/Length 46. Square Pipes (sections) Lengths 1800 – 2000/Length 47. Metal Plates Sheets 1500 – 2000/Sheet 48. Aluminum Profiles (for doors & windows) Pieces 2500 – 3000/Piece 49. Glazing Bites Pieces 1000 per Piece 50. Round Mild Steel Pipes Lengths 2000 – 2500/Length 51. Iron Ore Metric Tonnes 6,000 52. Dolomite “ 5,800 53. Limestone “ 4,850 54. Heavy melting Scrap “ 18,000 55. Steel Rods “ 100,000 56. Plates (Iron) Mts 3,500 – 60,000 57. Angle Iron “ 350 – 10,500 58. Plates Sheets “ 6,000 – 12,500 59. U-Channel “ 1,500 – 4,000 60. Channels “ 2,500 – 10,000 61. Pipe Casing “ 1,000 – 3,500 62. Shaft “ 500 – 1,800 63. Rods (Metals) Kg (Mts) 100 – 7,000 64. Electrodes Plits - 65. Cutting Disc Pieces 150 – 350 66. Oxygen Ltrs 3,300 – 5,500 67. Carbides Kg 60 – 20,000 68. Pipes Metals Mts 600 – 40,000 69. Gas Ltrs 15,000 70 Aluminum Roofing Sheets Mts 1,200 71. Anodized Aluminum Profiles “ 600 72. Flat Bar “ 800 – 1,700 73. Metal Sheets “ 3,000 – 8,000 74. Bearings Kg 150 – 2,500 75. Bolts “ 15 – 1,000 76. H-Beam Pieces 25,000 – 50,000 77. Z-Poline (Iron) Mts 3,500 – 5,000 78. Saw Blades Pieces 150 79. CE Plastic Mould Pieces 550 80. Thermostat Amplifier ADC Converter Nos. 4,000 81. Smoke Detector “ 2,100 82. Flat Metal Pan Sheet 2,850 83. Angle Iron Metres 1,500 84. U-Channel “ 6,500 85. Flat Metal Sheets “ 2,600 86. Mild Steel Bar “ 2,600 87. Mild Steel Sheet “ 6,500 88. Brass Rod “ 4,500 89. Stainless Steel Bar “ 35,000 90. Stainless Steel Sheet “ 29,000 91. Aluminum Bar “ 3,500 92. Aluminum Sheet “ 20,000 93. Moulding Material Mt - 94. Moulding Sand Mt -
  22. 22. 9 95. Lining Materials Mt - 96. Iron Ore Mt - 97. Copper Scraps Mt 450,000 98. Steel Scraps Mt 18,000 99. Aluminum Scraps Mt 142,000 100. Cast Iron Mt - 101. Angle Iron Mts 860 102. U-Channel “ 8,000 103. Mild Steel Pipe “ 10,000 104. Tin Plates “ 145 105. Steel Sheets Metric Tonne 200,000 106. Aluminum Circles/Spouts “ 450,000 107. Springs Pieces 300 108. Rivert Pins Metric Tonne 12 109 Aluminum Profiles Mts 143 110. Steel Coil Tonnes 2,307,506 111. Tin Plates Mts 145 112. Steel Sheets Metric Tonne 200,000 113. Steel Coil Tonnes 2,207,506 114. Aluminum Wire Mt - 115. Aluminum Rod Mt - 116. Aluminum Coil Mt 670,000 117. Aluminum Plate Sheet Pieces - 118. Paints/Thinner Ltrs - 119. Aluminum Handles Pieces - 120. Meth Chloride/Silicon Oil Kg - 121. Colour/Staneous Octate Kg - 122. Adhesive Ltrs - 123. TDI/Poly Oil Chem Kg - 124. Coating Kg - 125. Inks Kg - 126. PVC Kg - 127. Tin Free Steel Pieces - 128. Corrogated Carton Pieces - 129. Vanish Litres - TABLE 2.4: RAW MATERIALS IMPORTED S/N RAW MATERIALS UNIT OF MEASUREMENT UNIT COST (N) 2006 1. Stainless Steel Sheets 30,000 2. Stainless Steel Mt 500,000 3. Stainless Steel Plate 3,500 4. Mild Steel Sheets - 5. Cast Iron Lengths - 6. Iron Rods Lengths - 7. Ferrous Materials Pieces - 8. Non Ferrous Materials Pieces - 9. Angle Iron Pieces - 10. Electrical Motors Pieces - 11. Gear Box Pieces - 12. Pipes Pieces - 13. Flat Bars Pieces - 14. Electrodes Pkts - 15. Stainless Steel Rod Mt -
  23. 23. 10 16. Hot Rolled Coil Mt - 17. Induction Gears Mt - 18 Saw Blade Pkts - 19. Pulleys Pkts - 20. Iron Coil Mt - 21. Petrol Engine Pieces - 22. Diesel Engine Pieces - 23. Medium Carbon Steel Mt 320,000 24. High Carbon Steel Mt 330,000 25. Mild Steel Rod Mt 230,000 26. Aluminum Wire M3 - 27. Aluminum Handles Mt - 28. Aluminum Coil Mt 450,000 29. PVC Mt - 30. Reduction Gears Pieces - 31. Tin Free Steel Kg/Mt - 32. Aluminum Scrap Kg 160.00 33. Grinding Disc No. - 34. Mild Steel Angle Iron Kg 100.00 35. Mild Steel 1-beams Kg 100.00 36. Mild Steel U-channels Kg 100.00 37. Welding Electrodes Kg 300.00 38. Screws Packets 450.00 39. Bolts and Nuts Pieces 8.00 40. Ferro Alloys Mt - 41. Refractory “ - 42. Pig Iron “ - 43. Silicon Kg - 44. Aluminum Alloys “ 30,000/Kg 45. Steel plates Metric tons 115,000.00 46. Steel pipes Metric tons 120,000.00 47. Steel rods Metric tons 100,000.00 48. Angle bars Metric tons 105,000.00 49. Channels Metric tons 100,000.00 50. I – Beams Metric tons 100,000.00 51. H – Columns Metric tons 100,000.00 TABLE 2.5: RAW MATERIALS AVAILABLE LOCALLY BUT IMPORTED SUB-SECTOR: IRON AND STEEL S/N RAW MATERIALS UNIT OF MEASUREMENT UNIT COST (N) 2006 1. Electrode Pkts 1200 2. Nuts & Bolts Mt From N5.00 3. Iron Rods Mt 1100 4. Flat Sheets M2 5500 5. Flat Bars Lengths 800 6. Mild Steel Plate M2 3500 7. Galvanized Steel Plate M2 3500 8. Stainless Steel Plate M2 3500 9. Channel Angle Iron M2 3500 10. Industrial Motors Pieces 15000 11. Reduction Gears Pieces 15000 12. Saw Blade Pieces 200
  24. 24. 11 13. Pulleys MM 2500 14. Angle Iron Lengths 600 15. Aluminum Coils Mt 670,000 16. Stainless Steel Sheets 30,000 17. Stainless Steel Rods Mt - 18 Tin-Free Steel Kg - 19. Cast Iron Lengths - 20. Angle Iron Mt - 21. Electric Motors Pieces 15,000 22. Industrial Motors Pieces 15,000 23. Gear Boxes Pieces - 24. High Carbon Steel Mt 330,000 25. Steel Pipes Mt - 26. Saw Blades Pieces 200 27. Bolt and Nuts Pieces - 28. Hot rolled steel Mt 101,708.00 29. Cold rolled steel Mt 111,587.00 30. Tin sulphate Kg 350.00 31. Colouring agent Kg 250.00 32. Nickel acetate Kg 200.00 33. Aluminum fluoride Kg 150.00 34. Aluminum silicon Kg 260.00 35. Alkaline additive Kg 240.00 36. Hinges and Bolts Pieces - 37. Mild Steel Flat Bars Lengths - 2.4 Specifications of Raw Materials for Iron and Steel Production 2.4.1 Iron ore 2.4.2. Chemical Requirements DIRECT REDUCTION BLAST FURNACE PROCESS PROCESS Parameters Composition % Fе total 66.8min 63.8+ 54.82++ Fe203 95.5min 88.9+ 74.50++ Fe0 0.5 1.0+ 3.50++ Ca0 0.1 0.15+ 4.0++ Gangue (Sio2+A1203) <2.7 9.60+ 12.0++ Mg0 0.1 Trace+ 1.0++ P 0.003max 0.03+ 0.044++ S 0.003max 0.004+ 0.08++ Loss on Ignition (L.O.I.) 1.2max 0.21+ 43.575++
  25. 25. 12 2.4.3 Physical Requirements DIRECT REDUCTION BLAST FURNACE Parameters PROCESS PROCESS Grain Size 0-8mm 90% 0 – 1mm+25-25mm++ 8-20mm 10% ≤45 30%max (Limit of dedusting system) Moisture Content 10%max Work Index (Grindability) 18Kwh/t at 45 324 mesh 14Kwh/t at 74 200 mesh + Iron Ore Concentrate ++ Lump Ore 2.5 Coke Blend/Coke/By-products BLAST FURNACE PROCESS 2.5.1. Coal blend (i) Chemical requirements Composition% Volatile matter* Moisture total 27.7-30.3 Ash** 5 – 9 Sulphur 10 0.5 – 0.9 (ii) Physical Requirement Vertical shrinkage 5 – 7% Bulk Density 0.69 – 0.96t/m3 2.5.2 Coke (i) Chemical requirements Composition% Volatile matter* Humidity 1.5 Ash** 1.0 Suphur 1.3 1.2 max (ii) Physical Requirements Strength ISO M40 78 min Abrasion ISO M10 9 min
  26. 26. 13 2.5.3 By-Products Gas yield (4600k Cal/Nm3) 320 – 335 Nm3/t coal Ammonia yield 1.5 – 2.5 kg/t coal Benzene yield 25 – 35g/m3 Sulphuretted Hydrogen 12g/Nm3 Tar yiel 2.6 Oxide Pellet/Sinter Parameters DIRECT REDUCTION BLAST FURNACE PROCESS PROCESS 2.6.1 Chemical Requirement Composition% Oxide pellet Sinter Fetotal 66.8 min 52.7 SiO2 – Al2O3 < 2.7 10.43 CaO 1.6 – 2.0 12.09 MgO 0.04 – 0.1 2.12 P 0.030 max 0.036 S 0.004 max 0.011 Basicity 0.6 – 1.0 1.36 Fe203 95.8 min 60.29 Fe0 0.3 13.55 2.6.2 Physical Requirement Cold Compression Strength 3450N/Pellet min Tumble Index (6.3 – 19mm) 93%min Abrasion Index ( - 1mm) 5% max Grain Size 9mm – 15mm 95% min 15mm – 19mm 1%max 6.3mm – 9mm 4% max < 6.3 mm Nil 2.7 Limestone/Dolomite Parameters DIRECT REDUCTION BLAST FURNACE PROCESS (EAF Route) PROCESS (BOF Route) 2.7.1. Chemical Requirement Composition% CaO 53.0 min 53.0 31.02+ R2O2 = Al2O3 + Sio2 3.0 max - 4.33+ MgO 0.6 max 0.64 20.76+ P - 0.013 0.013+
  27. 27. 14 S 0.03 0.052 - Fe total - 0.15 0.20+ Fe2O3 - 0.21 0.28+ MnO - 1.81 0.005+ Humidity (0.5% max in dry season) 5% max in wet season 2.05+ Loss on lgnition (L.O.I) 43.76 43.575+ 2.7.2 Physical Requirement. Grain Size Grain Size 25 – 60mm 100% 25 - 50mm 25 - 50mm+ 25 – 55mm 90% 0 - 80mm 0 - 80mm+ At Kiln inlet (sinter plant) (sinter plant) <25mm (fines) 5% Hardness Coefficient - - 7% Bulk density - - 1.40 t/m3 Dolomite EAF - Electric Arc Furnace BOF – Basic Oxygen Furnace 2.8. Specifications for Foundry Molding Sands. 2.8.1. Silica Sand (i) Chemical Properties Composition % SiO2 9 Fe2O3 0.6 Al2O3 2.0 CaO = 0 MgO = 0 SO3 = 0 Melting Loss 0.7 PH 7 (i). Physical Properties Granulometry Particles 20 microns = 3% to 6% Fineness No. A.F.A. = 60 to 66 (RO-TAP Strainer) Distribution on strainer = More than 80% on strainer
  28. 28. 15 50 – 70 and 100 14000C 28.2 Zircon Sand (i) Chemical Properties Composition% ZrO2 60 SiO2 30 Al2O3 3 Fe2O3 1 L.O.I. 2 2. Physical Properties mesh sizes 0.25 – 0.5mm 0.5 0.10 – 0.25mm 98.0 0.10mm 1.0 Sintering temp. 14000C mm 2.8.3 Chromite Sand (i) Chemical Properties Composition% Sio2 0.8 Al2O3 1.3 Cr2O3 42.5 Fe2O3 47.0 (ii) Physical Properties Particle Size 0.13 – 0.60 mm 90 Sintering temp. 12500C. 2.8.4 Bentonite Chemical Properties Composition % SiO2 40 - 45 R2O3 (Al2O3 + Fe2O3 + Mn2O3) 23 - 28 CaO + MgO 6 - 8 H2O 10 - 15 L.O.I 17 - 23 Montimorillonite 70 - 75
  29. 29. 16 2.8.5 Mould Character ties (i) Physical Properties Green Compression Strength 8.50 - 9.50 N/Cm2 Splitting Strength 1.50 - 1.70 N/Cm2 Dry Compressive Strength 19.00 - 21.00 N/Cm2 Moisture (Compactability) 45% Hardness >75 Permenbility 150 - 180 Cm3/Min (ii) Chemical Requirement Composition % MgO 57 - 58 SiO2 2 - 4 Al2O3 4 - 6 Fe2O3 9 - 10 CaO 2 - 4 MnO 0.3 - 0.7 R2O3 10 - 11 LOI 10 - 11 (iii) Physical Requirement Grain size >2000SSA Sintering temperature 15000C Sticking temperature 14500C 2.9 Investment Opportunities in the Sector The Iron Steel industries operated at very low capacity utilization (0-5%) with the major industries (ASCL & DSC) not producing at all. It was observed that the main products of metal fabrications and manufacture sub-sector were doors and windows. For any meaningful increase in subsectoral capacity utilization, ASCL and DSC must statistically increase their capacity utilization up to 45%. However emphasis should be on the development and production of flat and alloyed steel which if fully developed would encourage greater activity in the foundry, metal (manufacture, and fabrication) sub-sectors, etc. Table 2.6: Some of the additional industries needed to make the existing industries self reliance are presented as follows:- Raw Materials Estimated Planned Production /annum Estimated Capacity of Existing Industries. Estimated Capacity of Additional Industries i) Iron ore concentrate 9,000,000 2,500,000 3 units of large scale capacity of 2,500,000 tons/annum. 1 unit of capacity 2,500,000 tonnes/annum already in place but yet to start
  30. 30. 17 ii) Iron casting iii) Steel casting iv) Flat steel sheet v) Alloy steels vi) Steel forgings vii)Refined zinc viii) Aluminium ix) Tin flat sheet 200,000 100,000 10,000 100,000 100,000 10,000 200,000 3,000 40,000 10,000 0 0 5,000 0 0 0 production. 4 units of medium scale plants of capacity 50,000 tonnes/annum. 9 units of small scale plants capacity 5,000 tonnes/annum. 2 units of medium scale plants of capacity 5,000 tonnes/annum. 5 units of medium scale plants of capacity 20,000 tonnes/annum. 10 units of small scale plant capacity 10,000 tonnes/annum. 1 unit of medium scale plant capacity of 10,000 tonnes/annum. 1 unit of medium scale plant capacity of 200,000 tonnes/annum. 1 unit of small scale plant of capacity 3,000 tonnes/annum. 2.10 Research and Development in the Sector The utilization of Research and Development as a veritable tool for the growth of this important sector has not been embarked upon by most of the stakeholders. Thus, the traditional method of design and fabrication of proto type process machines and equipment. The inability of the promoters to recognize the importance of research and development is informed by inadequate knowledge/lack of basic training in their professions, financial constraints, cultural disposition and long gestation period between the application and actualisation of the research findings as captured during the analysis of the received questionnaires. There has been belated attempts by some of the promoters to embark in rudimentary research and development in recent times, especially in the in the south West Zone. Thus, eleven (11) respondents out of 46 indicated that they conducted research and development, ranging from the design and fabrication of process machines, veneering of steel doors, reflex shadow forming to design and evaluation of machinery. Periodic workshop and seminars should be organized to sensitze stakeholders on recent scientific findings in the country.
  31. 31. 18 Recommendations 1. Regular training/workshop on modern fabrication techniques and technology transfer; 2. Regular supply of electric power and marking alternative energy source such as LPFO, gas, biogas, HPFO very affordable; 3. Removal of inherent bottle-neck to bank loan; 4. Proactive political will in project implementation viz: timely completion of Ajaokuta steel complex, Itakpe Iron Ore, Aluminium smelting and ban on export of aluminium scraps and copper scamps; 5. Transfer of research and development findings to the sector and setting-up R&D centres in each of the geo-political zones. 6. Ban on import of similar goods produced in Nigeria 7. Reduction of tariff (example removal of the additional increase on VAT); 8. Abolish multiple taxation and encourage tax incentives; and 9. Increased patronage of products from government and private organization. 2.11 Challenges and Opportunities Based on the analysis of the collected questionnaires, most of the problems in the sector were related to the following items: Raw materials Main raw materials as listed in the Annex are available but getting costlier by the day because they are all imported. The capacity to produce some of them locally is available but not being put to use due to import dependent syndrome Infrastructure The state of infrastructure – electricity, water, roads, etc is very poor and frustrating in the sub- sector. Operation and technology Most of the respondents use inadequate tools and methods in their operations. The technology in practice at the plants is significantly outdated. Thus efficiency is very low and product quality doubtful in some cases. The main problem here is capacity building. Equipment and machinery Due to low funding, most of the respondents lack modern equipment that aid engineering work. This affects the quantity and quality of their products.
  32. 32. 19 Finance Though this is a serious problem of the sector, we believe that unless where a – c above are addressed, any financial intervention will yield less than optimum success. Consequently, any intervention in direction must be preceded by serious and comprehensive capacity building. Political climate This does not pose much threat to operators. Most of them are apolitical. They think and breathe on their business. Government reform policies The sector is yet to feel the impact of the policies in terms of lower cost of doing business, high local patronage particularly from the public sector or capacity building. Power supply Iron and steel business relies so much on electricity for heating, melting, cutting, fabrication etc. Operators in the zone are seriously under-supplied with power. PHCN supply is erratic and unreliable while the cost of providing alternative power source continue to rise all the time. Cost of raw materials More than 90% of raw materials used in the iron and steel and foundry sub-sector are imported. Most of them are however obtained locally through direct importers who ensure that these products are highly priced. A good number of operators are not performing optimally because of the continuous rising cost of raw materials and inputs. Executive capacity It was observed that most of the respondents do not have the required skilled and experienced workforce to drive their vision. They are populated by low class but talented workers whose skills and expertise fail when intricate and complex problems show up. There is great need to upgrade the capacity of workers in the sub-sector. 2.12 Government Policies affecting the Sector 1. Beneficial Policies * Importation of capital goods – equipment and accessories are on zero duty. * Export of finished good attracts Export Expansion Grant of up to 45% of values of products exported. * Metal scrap export has been banned. 2. Adverse Policies  Scraps are still being exported illegally
  33. 33. 20  Clearing process is yet to be shortened  Cheap iron rods are imported which drive local producers out of business.  Local fabricators of equipment and machinery are not protected from cheap imports. 2.13 Conclusion The iron and steel sector is fundamental to the development and growth of the economy. It is therefore, imperative that the sector should not be allowed to deteriorate further. Obviously, the fall of the sub-sector will have a “falling effect” on such sub-sectors as real estate, automobile, furniture, simple machine, construction, basic office equipment, marine and many others. We therefore recommend its resuscitation and nurturing in order to benefit maximally from the sub-sectors. 2.14 Recommendations a. Efforts should be made by Government and its agencies to encourage local development of needed raw materials in order to reduce cost of inputs and ultimately create market for local fabricators and other operators. The steel plants at Ajaokuta, Aladja, Oshogbo, Jos etc should be made to work by putting pressure on the concessionaires. Those that are yet to be privatized should be put to the market soonest. The Iron Ore Plant at Itakpe should be streamed to feed the rolling mills. b. Production capacities i) The production capacity in the sub-sector is very low. In order to improve on this, the operators should be trained and mentored; ii) Locally-fabricated machines should be patronized by Government. iii) Financial institutions should be encouraged to provide easier access to funds. c. Research and development Research institutions should be refocused to accord high priority to commercialization. a) Finance
  34. 34. 21 While many respondents have installed equipment, they lack the necessary working capital to operate at optimum level. Thus, there is need to design a policy that attracts finances to local fabricators and foundries. b) Training d. There is need to design a training programme for this sub-sector. Leading operators should be co-opted as facilitators in the training programme.
  35. 35. 22 CHAPTER THREE CHEMICALS AND PHARMACEUTICALS 3.1 Introduction The chemicals, cosmetics and pharmaceuticals sector was dominated by multinational companies in the pre-independence period and up to the 1970’s. The major players in the sector included Glaxo, Pfizer, Sterling, Wellcome and PZ. By 1980, the sector witnessed phenomenal growth due mainly to Nigeria’s economic growth occasioned by the oil boom. This led to the establishment of more industries such as Smithline, Beecham, Afrab Chem, Vitabiotics, May and Baker, Ranbaxy, Bayer, Hoechst e.t.c. With the indigenization decree of 1978, which required that 60% of the shares owned by multinational companies be retained by Nigerians, many multinational companies were affected and by the mid 1980’s when the Structural Adjustment Programme (SAP) was introduced, most of the companies sold their stakes. However, some of the multinational companies are still operating in Nigeria. During these periods average capacity utilization fluctuated between 50% and 75% but it is currently below 50%. The low capacity utilization could be attributed to a number of factors amongst which were shortage of petroleum products, scarcity of local raw materials, erratic power supply, high interest rate, low purchasing power, devaluation of the naira, e.t.c. The chemicals, cosmetics and pharmaceuticals sector consist of the following sub-sectors: - Agrochemicals and fertilizers; - Basic chemicals; - Automotive and Dry cell Batteries; - Candles and crayons; - Cosmetics and toiletries; - Printing and writing inks; - Insecticides, aerosols and pesticides; - Petroleum and Petrochemicals; - Pharmaceuticals; - Safety matches; - Soaps and detergents; and - Paints and allied products. The previous publications covered these 12 sub-sectors. However, in 2006 only 3 sub-sectors namely Agro-chemicals and fertilizer, pharmaceuticals and soaps and detergents were covered in the survey. Consequently, this synthesis will focus on raw materials sourcing in these sub- sectors.
  36. 36. 23 3.2. Raw Materials Requirements and Sourcing The raw material requirement for these sub-sectors are presented in Tables 3.2.1 and 3.2.3 respectively. The 2006 survey revealed that the demand for most of these raw materials were not met locally. However, as compared to the previous exercise, the per centage utilization of most of the raw materials increased even though the demand for the raw materials were not met locally. Table 3.2.1: Capacity Utilization of Raw Materials: Soap and Detergent Sub-sector S/N Raw Materials National Demand MT Percent Utilization Average utilization for this survey Percent utilization from last survey 2003 2004 2005 2006 1. Oils and Fats 1,200,000 51.8 62 66.5 66 58.68 57.47 2. Caustic soda 124,000 718 76 78 78 75.95 70.57 3. Sodium silicate 147,000 33.5 42 46 45 41.63 33.67 4. Industrial salt (chloride) 105,000 47.5 51 52.5 60.5 52.88 47.45 5. Glycerin 30 26.2 25 25 26 25.55 26.17 6. Dyes (pigments) 8,540 250 42 41 41 37.45 25.82 7. Kaolin 56,000 25.7 86 86 92 74.93 35.65 8. EDTA 30 43 43.5 45 46 44.45 45.27 9. Perfume 163,184 88.9 86 86 90 87.73 88.9 10. Magnesium sulphate 4.1 80 70 70 62 70.50 79.57 11. Flush/soap stock 300 60.3 71 72 75 71.15 60.32 12. Sulphuric acid 24.012 66.5 71 72 75 63.40 71.45 13. Sodium carbonate 14,629.07 66.6 65 62 60 63.40 71.64 14. Sodium carbonate 82,000 3.2 40 56 62 40.30 20.9 15. Sodium toluene (sulphnate) 1,800 24 42 40 36 35.50 28 16. Sodium carboxyl methyl cellulose 1,800 46 42 47.93 66.2 33.4 17. Optical brightening agent 1,200 4.7 46 56 42.93 38.7 18. Sodium Tripoly phosphate (STPP) 165,960 16.7 46 42 56 42.93 38.7 19. Marble dust 150 27.8 87 42 82 83.45 70.5 20. Phosphoric acid 12.6 80.8 42 84 41 35.43 38.1 21. Titanium dioxide 1,200 16.7 35 42 24 26.25 33.3 22. Nervan acid 2.7 20 42 26 40 51.00 82.9 23. Tinpal 2.7 80 30 42 32 22.23 30.1 24. Calcium carbonate 900 16.9 86 20 82 30.73 72.2 25. Fuller earth 432 68.9 70 86 70 69.75 72.2 26. Hydrochloric acid 750 69 46 70 43 40.56 50 27. Ferric chloride 150 33.3 20 40 35 18.90 59.5 28. Aceto Diphosphoric Acid (ADPA) 2.7 66.7 70 24 62 67.18 72 29. Sulphur 120,000 33.3 46 70 72 52.83 33.3 30. Sulphuric Acid (sodium alicyclic Benzene sulphate) 140,000 55.6 50 60 60 37.40 51.9
  37. 37. 24 31. Pure petroleum jelly 10 42.9 42 64 43 94.23 29.9 32. Glycerol 30 50 48 46 46 74.5 50.00 33. Ethanol 3,250 50 46 52 48 40.13 30.00 34. Active Detergent Paste (ADP) 25,500 92.9 96 46 92 41.55 89.2 35. Nivolak 0898 4,500 50 82 96 80 46.1 51.6 36. Fatty Acids 125 38.5 40 86 41 51.30 35.1 37. Colourant 220 40.2 38 41 46 69.55 39.8 38. Dxtrin 8.4 42.4 48 42 46 38.90 46.8 39. Talc - 45.2 56 48 52 68.13 42.7 40. White tallow 25,000 22.2 90 52 80 34 41. Photine 172.8 38.6 40 86 39 36.7 42. Soda Ash Light 40,000 62.5 68 38 70 62.9 Table 3.2.2: Capacity Utilization of Raw Materials: Agro-Chemicals and Fertilizers S/N. Raw Materials National Demand (MT) Average Percent Utilization Present Survey Average Percent Utilization Last MTF Survey 1. Alumina (hydrated) 12,400 45.8 45.8 2. Amproluim 21.4 49.9 45.9 3. Bone meal 2,525 72.2 69.2 4. Breeder mix 1200 54.7 51.9 5. Brewers spent grains 1300 52.8 45.9 6. Broiler premix 1400 48.2 45.9 7. Chick premix 1200 72.3 70.1 8. Coating oil 900 62.9 62.9 9. Copper oxide 4200 80.1 79.9 10. Cotton cake 5800 78.9 69.9 11. Fish meal 5209 72.4 63.7 12. Furazolidone 5 43.2 41.6 13. Groundnut cake 42,000 48 18.0 14. Grower premix 1000 49.2 45.8 15. Kaolin 7200 74.2 69.9 16. Layer premix 2050 84.2 78.9 17. Lime 200 74.5 71.3 18. Limestone 210 82.5 78.9 19. Lysine 1800 68 71.3 20. Maize 78,000 78 78.4 21. Maize offals 14,000 92 61.0 22. Meat meal 1000 92.5 71.9 23. Mentholine 2050 61.2 88.3 24. Methionine 40 68.1 91.5 25. Nitrovine 4.5 52.4 99.9 26. Oxytetracycline 2.8 43.4 67.5 27. Oysershell 4200 54.5 51.3 28. Palm Kernel Cake 5412 92.2 39.9 29. Phosphate rock 2,000 23 49.9 30. Phosphoric acid 2500 5 72.9 31. Potash 16500 84 81.8
  38. 38. 25 32. Rice 50 92 89.6 33. Rice shaft 7200 93 69.8 34. Sodium chloride (salt) 520 84.5 78.9 35. Sorghum 14,000 95.6 94.0 36. Soyabean 42000 98 93.1 37. Spent grain 62000 98.9 98.5 38. Sulphur 19,200 79.3 79.3 39. Vitamins/protein/Mineral/Concentratetes 6214 98.5 78.5 40. Wheat offal/Brain 7200 92.4 89.9 41. Yeast 5 54.2 45.9 Table 3.2.3: Capacity Utilization of Raw Materials: Pharmaceuticals Sub Sector S/N Name of Raw Materials National Demand MT % Utilization Average % last MTF Survey Utilization Present survey 2004 2005 2006 1. Paracetamol 7332.5 67.7 87.2 88.5 57.5 81.1 2. Ascorbic acid 1006.4 83.2 75.2 88.3 70.6 82.2 3. Phthalyl sulphathiazole 955.0 44.1 46.4 46.3 33.7 45.6 4. Promethazine 100.1 43.1 43.6 56.2 47.5 47.6 5. Sulphamerazine 12.3 33.6 34.1 35.2 26.2 34.3 6. Sodium dihydrogen phosphate 50.8 46.1 47.2 50.6 25.8 47.9 7. Sodium sulphite (anhydrous) 18.6 45.2 48.1 55.2 35.7 49.5 8. Lactose 817.3 50.3 50.0 53.6 45.3 51.3 9. Ammonium chloride 200.2 92.5 90.3 88.1 88.9 90.3 10. Chloroquine phosphate 2635.2 84.0 84.2 89.9 79.6 86.0 11. Metronidazole benzoate 44.9.7 66.0 68.1 76.6 60.3 70.2 12. Pregelatinized maize starch 201.7 88.6 83.7 89.8 71.5 87.4 13. Granulated sugar 30070.0 79.2 78.1 79.8 71.6 79.0 14. Aspirin 716.8 45.2 35.5 36.1 20.9 38.9 15. Sodium benzoate 31.4 32.0 28.1 38.0 28.0 32.7 16. Benzoic acid 320.6 84.3 72.5 87.7 66.2 81.5 17. Lemon oil 156.3 48.1 46.9 52.6 35.6 49.2 18. Propylene glycol 927.6 44.0 42.0 46.1 38.7 44.0 19. Peppermint oil 80.3 44.5 56.1 88.6 70.5 63.1 20. Veegum 600.6 55.5 50.1 42.1 38.1 49.2 21. Orange oil (Terpenless) 875.0 43.1 50.0 41.0 33.3 44.7 22. Ethanol 96% 1125.7 84.2 84.8 90.1 82.9 86.4 23. Grape extract 622.1 36.7 38.3 43.5 30.1 39.5 24. Calcium glycerophosphate 30.2 76.8 71.5 72.6 72.2 73.6 25. Dextrose 15242.0 86.2 84.4 88.7 72.2 73.6
  39. 39. 26 monohydrate 26. Vitamin D3 beadlets 100.5 56.2 56.1 76.3 50.0 86.4 27. Acacia gum 2125.4 90.1 88.1 91.1 57.5 62.9 28. Silicon dioxide 300.6 80.6 82.7 88.1 72.0 89.8 29. Kaolin 1002.0 34.6 42.0 63.3 33.3 83.8 30. Corn starch 637.2 50.2 56.1 58.4 51.9 46.6 31. Folic acid 67.8 42.0 48.3 49.4 29.9 54.9 32. Thiamine HCI 100.6 52.8 60.8 60.1 50.0 46.6 33. Riboflavin 180.1 85.0 56.2 58.0 50.0 57.9 34. Nicotinamide 257.0 81.6 94.2 90.8 89.1 66.4 35. Chlorpheniramine 500.7 65.7 76.2 78.4 51.5 88.9 36. Aspartame 300.7 35.8 33.4 43.3 35.1 73.4 37. Magnesium trisilicate 1867.4 73.1 60.9 72.5 39.8 37.4 38. Magnesium carbonate 5214.1 64.2 62.1 68.5 46.8 68.8 39. Sodium bicarbonate 5612.7 50.0 61.6 58.3 42.7 64.9 40. Microcrystalline cellulose 500.6 86.5 96.7 90.4 34.0 56.6 41. Magnesium stearate 2216.1 72.6 73.3 84.9 36.7 91.2 42. Penicillin potassium 50.3 68.4 72.5 64.2 62.9 76.9 43. Gentamicin sulphate 102.2 53.2 50.6 56.6 57.3 68.4 44. Benzoic acid 69.2 40.6 59.2 68.1 49.5 53.5 45. Sulphur 235.2 64.8 71.249.8 59.7 60.5 55.9 46. Methyl salicylate 331.0 60.1 53.0 66.4 46.1 65.2 47. Clotrimazole 85.6 54.0 55.6 55.4 48.1 58.8 48. Tioconazole 101.1 50.0 84.5 60.1 58.8 54.1 49. Clotrimazole 80.5 72.1 96.5 80.0 34.6 55.2 50. Neomycin sulphate 3032.6 90.2 82.6 96.8 35.8 78.9 51. Prime thamme 12322.3 53.2 55.2 81.7 65.3 94.5 52. Sodium chloride 518.0 40.6 75.6 60.1 61.9 81.6 53. Dextrose monohydrate 2652.0 64.8 42.4 82.1 45.2 59.8 54. Sodium chloride 822.3 60.1 31.4 35.1 45.7 79.4 55. Potassium chloride 625.1 54.0 72.9 36.5 23.9 37.0 56. Polyvinyl-pyrolidone 627.4 50.0 88.6 66.0 54.1 36.8 57. Ammonical lead 825.0 72.1 60.1 92.7 57.8 73.1 58. Leadoxide 311.5 90.2 67.1 59.2 79.9 91.9 59. Microcrystalline powder 217.2 80.5 67.1 52.6 54.6 58.3 60. Talcum powder 89.3 64.2 52.1 64.3 34.1 54.9 61. Acetaminophem 640.0 80.5 64.9 72.4 45.2 55.2 62. Chloroquine sulphate 18.0 33.6 30.0 33.1 45.2 65.5 63. Glucose 14.2 42.5 35.9 44.3 34.1 31.1 64. Ferric ammonium Citrate 184.9 80.5 30.2 32.0 41.1 40.3 65. Diphenyl hydrazine HCL 480.3 94.5 50.1 54.5 19.9 31.1 66. Diphenyl hydramine HCL 2680.0 55.6 84.2 84.0 56.9 40.3 67. Tetracycline powder 1100.3 45.2 72.4 73.0 45.9 32.4 68. Real liver extract 660.1 49.2 65.6 70.2 56.7 49.6
  40. 40. 27 69. Tincture of auranthe 191.8 59.2 70.2 70.6 29.5 81.0 70. Oleum morrhue 130.2 30.2 80.5 82.6 34.7 70.6 71. Styroper 80.3 40.6 62.4 60.1 45.1 68.3 72. Acctaminophen 48.4 35.0 42.4 40.5 49.8 70.3 73. Sodium hydroxide 2403.4 44.2 80.1 80.0 34.9 81.2 74. Sodium citrate 50.2 74.8 78.9 79.2 41.0 56.3 75. Citric acid 36.5 66.5 59.4 70.3 29.9 39.6 76. Menthol 32.2 69.2 49.3 50.1 57.7 77.5 77. Sodium carbonxy methyl cellulose 36.1 70.1 42.6 40.8 34.1 76.9 78. Colour amaranth 18.4 80.5 42.8 64.2 23.9 65.4 79. Essence mixed fruit 192.0 46.5 56.3 60.3 43.0 48.3 80. Sorbitol 135.7 35.9 79.2 84.5 28.8 41.2 81. Niposal 500.8 72.4 70.2 76.4 42.6 45.7 82. Sucrose 72.6 72.6 56.4 60.1 40.3 63.4 83. Polysorbatetween 219.8 66.6 50.0 51.2 51.9 81.4 84. Colour etrazine 300.6 45.6 62.2 60.0 39.9 73.1 85. Copour ponceav 284.1 40.2 55.8 60.1 18.9 54.1 86. F.A.C 61.6 30.1 72.9 70.6 39.9 50.4 87. Sorbic 12.7 64.2 60.0 59.8 23.8 60.9 88. Ampicillin trohydrate 12.5 80.4 82.7 90.6 43.1 55.4 89. Chloroform 16.6 72.8 22.8 40.5 39.9 69.9 90. Iodine crystal 31.3 45.8 49.2 64.5 23.9 59.9 91. Potassium iodide 132.1 50.1 72.2 65.3 46.3 82.1 92. Chloroxylenol powder 86.1 60.5 62.0 60.3 89.9 32.2 93. Calam 5.2 50.2 82.0 79.2 59.9 54.7 94. Zinc oxide 2.6 65.5 42.5 50.0 77.2 72.8 95. Calcium photothenate 62.3 60.1 33.6 33.2 44.9 61.5 96. Vitamin A 861.4 72.9 56.5 48.6 39.1 80.5 97. Banana four 230.3 33.2 82.6 82.6 48.4 43.7 98. Ephedrine hydrochloride 6777.6 50.4 80.5 95.0 45.9 32.3 99. Chroramphenicol powder 380.8 80.9 85.0 90.0 44.5 48.4 100. Phythalysophatiazol 3.4 62.1 30.4 29.8 29.9 81.7 101. Methyl salicylate 26.8 80.4 80.6 72.0 18.9 84.9 102. Turpentine oil 10.3 38.6 72.5 85.9 23.0 85.2 103. Evcalyptos oil 11.4 30.2 70.4 84.0 23.7 75.1 104. Camphor 68.1 40.1 28.6 30.1 18.9 74.7 105. Paraffin wax 88.0 80.0 62.0 10.5 19.7 26.7 106. Petroleum jelly 10.5 79.2 30.1 40.0 18.5 26.8 107. Kaolin 80.6 52.0 62.8 19.5 30.9 108. Pectin 3.4 22.6 70.2 58.9 34.1 53.7 109. Glycerine 26.8 72.5 45.1 50.2 23.5 65.0 110. Methyl hydroxyl benzoate 10.3 66.9 62.8 68.3 44.4 42.9 111. Propyl hydroxybenzoate 11.4 69.8 30.2 45.4 21.0 68.5 112. Taracids 68.1 21.5 30.4 30.4 16.8 32.8 113. Crosylic creosote 88.0 8.0 28.0 29.3 18.9 27.8 114. Cosein 10.5 22.6 30.5 30.0 45.2 31.2
  41. 41. 28 115. Borax 18.2 46.2 40.1 42.0 56.8 40.7 116. Chloroxylenol powder 185.4 66.0 18.5 30.2 56.1 25.1 117. Castor acid 121 33.6 45.1 50.2 45.2 42.9 118. Potassium hydioxide 50.6 74.522.8 62.8 68.3 44.4 68.5 119. Terpenol 203.5 22.6 30.2 45.4 21.0 32.8 120. Chlorinated terpene 193.2 28.2 30.4 30.4 16.8 27.8 121. Lactalbumin 64.9 33.2 28.0 29.3 18.9 28.5 122. Yeast extract 89.2 40.1 30.5 30.0 45.2 31.2 123. Amphotericin B 24.3 26.5 40.1 42.0 56.8 40.7 124. Newbern calf serom 17.3 18.5 30.2 56.1 25.1 45.2 Available data from 2006 report revealed that some “key” raw materials, including: kaolin, mineral acids, calcium carbonate (different forms) and talc were required by several other sub- sectors notably, Pulp and Paper, Textiles and Leather, Plastics and Rubber and Petroleum and Petrochemicals. As a result of their versatility, a shortfall in the supply of these “key” raw materials would result in reduced capacity utilization in many industrial sectors. Since these materials enjoy a wide domestic market and occur locally in the form of mineral deposits, development and large scale exploitation of the minerals and their processing into industrial feedstocks would be of tremendous benefit to increase capacity utilization in many sectors of industries. 3.2.1 Raw material sourcing As in previous years, most of the raw materials required by these sub-sectors were imported. Only a marginally small fraction is sourced locally. The distribution of groups of the raw materials according to source (that is local, partly local and partly imported) is shown in Tables 3.2.1, 3.2.3 and 3.2.4 in the 2006 report. 3.2.2 Imported raw materials These raw materials represent those consumables the country cannot develop for now. In this category are materials like pharmaceutical kaolin, pharmaceutical starch, the mineral acids, sulphuric acid, sodium hydroxide, plastic derivatives and polymer based organic compounds, and organic solvents. The inability to produce these materials arose from the inadequate manufacturing infrastructure of the basic chemicals sub-sector and the non-completion of the petrochemical plants. 3.2.3 Raw materials (partly sourced locally) These raw materials are so categorized that the country has the natural resources for their production, yet are still being imported. What is required is to develop the country’s technological capability through better infrastructure and human resource development.
  42. 42. 29 3.2.4 Raw materials (locally sourced) RMRDC survey reports have shown that a lot of the chemicals on the locally sourced column can be locally developed to substitute the imported ones. The problem is the fact that the country still lacks the technology required for their production to the requisite industrial specifications. Tables 3.2.1,3.2.2 and 3.2.3 in the 2006 report show that several raw materials which are presently imported can be fully sourced locally. The existing as well as potential raw material sources for each of the 3 sub-sectors under consideration are briefly examined. 3.2.5 Raw materials specifications for the sector In an effort to assist raw material suppliers to deliver raw materials of the right quality and specifications, RMRDC compiled the first publication titled “Raw Materials Utilized by Nigerian Industries” in 1996. The publication contained the various raw materials and the specifications for the various products being produced from these raw materials. The 2005 edition of the publication was based on the ten sectors. The specifications for the major raw materials in the 3 sub-sectors covered in this report are presented in subsequent tables. Agro-Chemicals and Fertilizers (1) Alumina, Hydrated % Al203 65 % Si02 0.01-0.02 % Fe203 0.01-0.02 %Ti02 0.003 % P205 0.001 % CaO 0.01 % 2nO 0.001 % Na2O total.. 0.3-0.4 % Na2O soluble 0.005-0.03 % Moisture content 0.2 % particle size distubation larger than 106 microns 10-20 106-63 microns 30-50 63-45 microns 10-35 Smaller than 45 microns 20-40 % whiteness (457nm) 80 Density (g/cc) 2.4 Bulk density kg/m3 1200 (2) Calcium carbonate % Si02 2.49 % Fe203 2 max
  43. 43. 30 % Mgo 6 max % CaCo3 (3) Limestone % cako3 90 max % Sio2 5 max % Fe203 2 max % Mg0 6 max (4) Phosphate (for fertilizer production) % Moisture 0.53 % P205 36.45 % CaO 51-64 % P203 2.88 % Fe203 1.34 % AI203 1.54 % C02 1.52 % F 3.97 % Total Chlorine Traces % Mg0 0.35 % Si02 3.25 % S03 0.37 (5) Sulphur % moisture 0.37 % Sulphur 99.93 % organic matter 0.037 % Ash 0.033 Ti02 and others Traces PHARMACEUTICAL (1) Ascorbic Acid Appearance - A white or almost white crystalline powder or colourless crystals, discoloured on exposure to air and moisture - Freely soluble in water and practically soluble in other solvents. Melting Point (oc) - about 190 with decomposition Specification optical rotation +20.5 – 21.5 Oxalic Acid - opalescence in sample solution should not be more than that in the reference solution.
  44. 44. 31 Heavy metals - Not more than 10ppm Sulphated Ash - Not more than 0.1% % Assay - 99.0 – 100.5 (2) Aspirin (Acetyl salicytic acid) Characteristics colourless crystals on a white crystalline powder. Odourless or almost odourless Solubility Slightly soluble in water ethanol, chloroform and ether, clarity and colour of solution, clear and colourless. % Sulphated Ash not more than 0.1 % ASSAY 99.5 – 101.0 (3) Amphicilin trihydrate Characteristics A white crystalline powder, odourless or almost odourless. Solubility Slightly soluble in water, practically insolable in ethanol (9.6%) in chloroform, ether and in fixed oils. % moisture W/W. 12 – 15 % Assay 96 – 100.5 (4) Benzoic Acid Characteristics colourless crystals or a white crystalline powder, Odourless Solubility slightly soluble in water, boiling water freely soluble in ethanol (96%), in chloroform, ether and fixed oils. Heavy metals (pb) Ippm Halogenated compounds and halides 300ppm % Sulphated Ash not more than 0.1 % Assay 99.0 – 100.5 (5) Chloroquine Phosphate Description A white or almost white hygroscopic, crystalline Powder Solubility freely soluble in water, slightly soluble in alcohol, ether and methanol. pH 3.8 – 4.3 Heavy Metals Not more than 20ppm % Moisture Not more than 2.0
  45. 45. 32 % Assay 98.5-101.0 calculated with reference to anhydrous. (6) Citric acid anhydrous Characteristics Colourless crystals or a white crystalline powder Solubility Soluble in 1 part of water and in 1.5 parts of ethanol (96%), sparingly soluble in ether. Heavy metal not more than 10 ppm % sulphated Ash not more than 1-0 % Assay 99.5 – 101.0 (7) Clotrin mazole Characteristics white to pale yellow crystalline powder, odourless. Solubility insoluble in water, ethanol, chloroform and ether Clarity and colour of solution clear. % Sulphated Ash Not more than 1.0 % Assay 98.5 – 100.5 (8) Folic acid Characteristics yellow to orange Crystalline powder ordourless or almost odourless Solubility insoluble in water and in most organic solvents It dissolves in dilute acid and alkaline solutions % sulphated Ash not more than 0.2 % Ash 96.0 – 102.0 (9) Granulated sugar Appearance A white crystalline powder or lustrous, dry colourless or white crystals Solubility very soluble in water, slightly soluble in alcohol. Acidity not more than 0.3ml of 0.01m sodium hydroxide is required for neutralization. Specific optical rotation +66.3-67.00 Loss on drying not more than 0.1% Microbial count Total Bacterial count: NMT 1000 Total Mould count: NMT 100 Total Yeast count: NMT 100 Coliform count, salmonella sp. Staphylolocus sp. And Pseudomonas spp. Absent
  46. 46. 33 (10) Magnesium trisilicate Characteristics white powder Solubility soluble in water, ethanol and glycerol, insoluble in chloroform and ether pH 2.7 – 3.3 clarity and colour of solution clear and not intensely coloured lead (pb) 2ppm % sulphate Not more than 0.1 % Assay 98.5 – 101.5 (11) Metronidazole benzoate Appearance white or slightly yellowish crystalline powder or Flakes Solubility practically insoluble in water freely soluble in methylene chloride soluble in acetone, slightly soluble in alcohol, very slightly soluble in ether Heavy metals not more than 20 ppm % Assay 98.5 – 101.0 calculated with reference to the dried substance. (12) Micro crystalline cellulose Synonym avicel pH 101 Appearance a white or almost white fine granular powder Solubility practically insoluble in water, acetone, ethanol, toluene and in dilute acids and in a 50g/l solution of sodium hydroxide. 50mg in 10ml ammonical solution of copper tetramine dissolves completely leaving no residue pH (supernatant) 5.0-7.5 Ether soluble substances the residue weighs not more than 5.0mg(0.05%) Water soluble substances the residue weighs not more than 12-5mg (0.25%) Starch no blue colour is produced Heavy metals not more than 10.0ppm % loss on drying not more than 6.0 % sulphated Ash not more than 0.1 Microbial count Total Bacterial count: NMT 1000 Total Mould count: NMT 100 Total Yeast Count: NMT 100
  47. 47. 34 Coliform count, salmonella sp. Staphylococcus sp. and Pseudomonas sp. Absent (13) Nicotinamide Characteristics colourless crystal or a white crystalline powder, odour faint and characteristics. Solubility soluble in water and ethanol Lead (pb) 1 ppm % loss on drying not more than 0.55 % sulphated Ash not more than 0.1 % Assay 99.0 – 101.0 (14) Paracetamol Appearance A white crystalline powder Solubility sparingly soluble in water, freely soluble in alcohol, very soluble in ether and methylene chloride. 4 Aminophenol Not more than 50 ppm Heavy metals Not more than 20 ppm % loss on drying Not more than 0.5% % sulphated Ash Not more than 0.1 % Assay 99.0 – 101.0 calculated with reference to dried Substance (15) Propylene glycol Appearance A viscous clear colourless, hygroscopic liquid. Miscibility Miscible with water and alcohol Relative density (at 20oC) 1.035 – 1.040 Refractive index (at 20oC) 1.431 – 1.433 Boiling range 184 – 1890C Heavy metals not more than 5ppm % moisture not more than 0.2 % sulphated Ash not more than 5mg (0.01) (16) Riboflavin Characteristics yellow to orange yellow crystalline powder Solubility very soluble in water, insoluble in ethanol, acetone, chloroform and ether specific optical rotation 115 – 135o % loss on drying not more than 0.1 % sulphated Ash not more than 0.1 % Assay 98.0 – 101.0
  48. 48. 35 (17) Sodium carboxymethyl cellulose Synonym carmellose sodium Appearance a white or almost white, granular powder, hygroscopic after drying Solubility practically insoluble in acetone, ethanol and toluene. Easily dispersed in water giving colloidal solution. % chlorides not more than 0.25 Heavy metals not more than 20 ppm % loss on drying not more than 10.0 % sulphated Ash 20.0 – 33.3 % Microbial count Total bacterial count : NMT 1000 Total mould count : NMT 100 Total yeast count : NMT 100 Coliform count; salmonella sp. Staphylococcus sp and Pseudomonas Absent (18) Sodium benzoate Appearance A white crystalline or granular powder or flakes, slightly hygroscopic Solubility freely soluble in water, sparingly soluble in alcohol (90% v/v) Solution clear and colourless Chlorides not more than 150 ppm Heavy metals not more than 10ppm % loss on drying not more than 2.0 % Assay 99 – 100.5 (19) Sodium bicarbonate Characteristics white, crystalline powder, odourless Solubility soluble in water, insoluble in ethanol Chloride not more than 150ppm Clarity and colour of solution/ clear and colourless Sulphanated not more than 150ppm (20) Sodium Chloride Characteristics colourless crystal or a white crystalline powder, odourless Soluble in water/slightly soluble in ethanol and glycerol Clarity and colour of solution/clear and colourless Arsenic Not more than 1ppm Lead (pb) not more than 1ppm
  49. 49. 36 Iron not more than 20ppm Bromide not more than 50ppm Phosphate not more than (21) Sodium sulphite (Anhydrous) Formula Na2SO3, 126.0g Characteristics A white powder Solubility Freely soluble in water and very slightly soluble in alcohol Iron Not more than 10ppm Heavy metals Not more than 10ppm Assay, % 95.0 – 100.5 (22) Sorbic acid Characteristics A white or creamy-white powder. Odour; faint and characteristic Solubility Slightly soluble in water and in fats and fatty oils, soluble in 10 parts of ethanol (96%) and in 20 parts of ether Heavy Metals Not more than 10ppm Assay, % 99.0 – 100.5 (23) Sorbitol Characteristics A white crystalline powder, odourless Solubility Practically insoluble in chloroform and in ether Sulphated ash, % Not more than 0.1 Assay, % 98.0 – 1010 (24) Sulphathiazole Characteristics A white or slightly yellowish, crystalline powder Solubility Practically insoluble in water, slightly soluble in alcohol, practically insoluble in ether and in methylene chloride Melting Range, OC 200 - 203 Heavy Metals Not more than 20ppm Sulphated ash, % Not more than 0.1 Assay, % 99.0 – 101.0 (25) Sulphamethoxazole Formula C10H11N3O3S1 253.3g Appearance A white or almost white, crystalline powder Solubility Practically insoluble in water, slightly soluble in
  50. 50. 37 acetone, sparingly soluble in alcohol. Dissolves in dilute solutions of sodium hydroxide Loss on Drying Not more than 0.5% Heavy Metals Not more than 20ppm Sulphated Ash, % Not more than 1.0 Assay, % 99.0 – 101.0 calculated with reference to dried Substance. (26) Starch (Maize) Appearance A matt, white to slightly yellowish, very fine powder which creaks when pressed between the fingers, tasteless. Solubility Practically insoluble in cold water and in alcohol. Identification A thin cloudy mucilage is formed on boiling with water Foreign Matter Not more than traces of cell membranes and protoplasm are present Loss on Drying, % Not more than 15.0 Sulphated Ash, % Not more than 0.6 Microbial Count, Total Bacterial Count NMT 1000 Total Mould Count NMT 100 Total Yeast Count NMT 100 Coliform Count, Salmonella sp, Staphylococcus sp and Pseudomonas spp Absent (27) Sunset Yellow Characteristics Orange-red crystals Solubility Soluble in water, slightly soluble in ethanol pH(2% w/v) 4 – 5 Dye content, % Not less than 11.0 Arsenic Not more than 2ppm Heavy Metals Not more than 20ppm (28) Tartaric Acid Characteristics Colourless crystals or a white, crystalline powder Solubility Soluble in less than 1 part of water and 2.5 parts of ethanol (96%) pH (1% w/v Suspension) 3.5 – 6.0 Sulphated Ash, % Not more than 0.1 Heavy Metals Not more than 10ppm
  51. 51. 38 Assay, % 99.5 – 101 (29) Tetracycline Characteristics A yellow crystalline powder, odourless Solubility Soluble in ethanol (96%) and in methanol, sparingly soluble in acetone pH (% w/v Suspension) 3.5 – 6.0 Sulphated Ash, % 0.5 Heavy Metals Not more than 50ppm Assay, % 95 – 100.5 calculated with reference to the dried substance (30) Zinc Oxide Characteristics A soft white or faintly yellowish-white amorphous powder, free from grittiness; odourless Solubility Practically insoluble in water and in ethanol (96%). It dissolves in dilute mineral acids Assay, % 99 – 100.5 3.3 Soap and Detergent Sub-Sector (31) Aluminum Sulphate Appearance White Crystalline Powder Alumina (AI2O3),% 16 – 18 pH (10% solution) 2.4 Copper 5ppm, max. Cobalt 5ppm, max Arsenic 5ppm, max Iron as Fe2O3 200ppm, max Chromium + Nickel 20ppm, max (32) Soda Ash for detergent manufacture Na2 CO3 % 97.5 min. Moisture, % 2.0 max NaHCO3 % 2.0 max Fe, ppm 20, max. Ni + Cr, ppm 10 max Cu, ppm 1 max Ar, ppm 10 max Water Insoluble, % 0.5 max Bulk Density Kg/m3, % Dense 1005 Light 500
  52. 52. 39 Sieve (BSS Mesh), % Light R22 nil R60 6 max Dense R14 0.5 R30 35.0 White Crystalline Powder (33) Soda, caustic (Liquid) NaOH, % 45-50 Na2CO3,% 1.0 max NaCI, % 0.5 max Na2SO4, % 0.05 max Water insoluble,% 0.5 max CIo4, ppm 50 max Fe, ppm 10 max Cu, ppm 1.5 max Ar, ppm 1.0 max Hg, ppm 1.0 max Appearance Clear water – like liquid, free from suspended Matter (34) Sodium carbonate for soap and detergent Appearance White Crystalline Powder Na2CO3, % 97.5 min Moisture, % 2.0 max Ni + Cr, ppm 1.0 max Cu, ppm 1 max As, ppm 1.0 max Water insoluble, % 0.5 max Bulk density, Kg/m3 Dense 1005 Light 500 (35) Sodium hydroxide Liquid for soap production Appearance Clear water – white liquid free from suspended matter NaOH, % 45-50 Na2CO3, 1.0 max NaCl,% 0.5 max Na2SO4,% 0.05 max Water insoluble, % 0.5 max CI04, ppm 50 max Fe, ppm 10 max Cu, ppm 1.5 max As, ppm 1.0 max
  53. 53. 40 (36) Sodium tripolyphosphate (STPP) for detergent manufacture P2O5, % 57.0 Water insoluble, % 0.1 max pH in 1% Solution, % 9-10 Loss at 130oC, % 1 max Temp Rise TestoC 11.5-14 Na5P3O10, (ortho),% 90 min Na4P2O7,% 6 max Na3PO4,% 2 max Fe, ppm 100 max Cu, ppm 5 max As, ppm 10 max Ca, ppm 100 max Mg, ppm 100 max Sieve (BSS Mesh)%, R60 3 min R 100 90 min R 200 75 min Appearance White Powder (37) Titanium dioxide for soap manufacture Appearance Very white powder free from foreign particles Purity, % 98.5 min pH, in 10% solution 6.1-6.7 Loss (105oC), % 0.5 max Bulk Density g/ml, 1 Tape 0.42-0.50 50 Tape 0.55-0.65 Lead, ppm 20 max Arsenic, ppm 10 max Sieve (BSS Mesh), % 10 max The detailed listing of specifications of all the raw materials can be found in the “Handbook on Specifications of Raw Materials Utilized by Nigerian Industries” RMRDC publiction. 3.4 Capacity Utilization Profile 3.4.1 Agro chemicals and fertilizers With the exception of vitamins, mineral concentrates, biocides and herbicides, all other raw materials required for the agro chemicals sub-sector can be fully sourced locally as presented in table 3.1.1 of the 2006 report. It is encouraging to note that the 2006 survey report shows high capacity utilization in this sub-sector, particularly the poultry feed industry. For example, the typical percentage capacity utilization values in the 2007 report for some of the feed raw materials that can be fully sourced locally are as follows: bone meal, 72.2%; chick primex 72.3%; coating oil 62.9%; copper oxide 80.1%, cotton seed cake 78.9%; fish meal 72.4%; kaolin 74.2%;
  54. 54. 41 layer premix 84.2%; lime 74.5%; limestone 82.5%; maize 78%; palm kernel cake 92.2%, etc. Although a good fraction of these materials are still being imported, the high capacity utilization is a welcome indication of increased local sourcing of imports in this sub-sector. Infact some items that are presently fully imported such as gammaline base and lindane (technical-benzene hexachloride) can be manufactured locally using a high percentage of local raw materials. 3.4.2: Pharmaceuticals In order to examine the sourcing of raw materials for the domestic pharmaceutical industry many of the raw materials required by the sub-sector have been grouped into five classes. In principle it should be possible to source all the excipients, some of the diluents, additives and active ingredients locally. In practice however, very few raw materials for this sub-sector are sourced locally, and the locally sourced materials could hardly meet more than 10 percent of the industrial demand. Over 40% of the raw materials used in the pharmaceutical industries are still being imported. These include: i) Solid diluents - dextrose and lactose, cellulose and industrial Salt ii) Builders - acacia, glucose starch, and mucilage. iii) Disintegrants - starch obtainable from maize, rice, yam, cassava, and cocoyam. iv) Mineral-based excipients kaolin and bentonite, borax, calamine and chalk (gypsum). v) Sweetening agents - granulated and liquid sugar and saccharin vi) Flavouring agents vii) Liquid diluents - ethanol, methanol, isoprophyl alcohol, kerosene and propylene glycol. 3.4.3. Soaps and detergents Oils and fats and caustic soda form the major raw materials for the soap industry. Whereas oils and fats (in particular palm kernel oil and palm oil) are sourced locally, no serious effort, either by Government or private entrepreneurs, is being made to source caustic soda locally. Caustic soda is produced basically from salt (Sodium chloride). Large salt deposits have been suspected at several locations within Nasarawa, Ebonyi, Cross River and Kebbi states. RMRDC and other stakeholders are making efforts in exploitation of the common salt in these locations. Most of the linear alkyl benzene required for detergent production is now sourced locally from the Kaduna Refinery and Petrochemicals Company (KRPC). Even the other raw materials required by the sub-sector are fully or partially sourced locally; these include: calcite, calcium carbonate, ethanol, glycerin, kaolin, marble dust, petroleum jelly, sodium silicate, and starch. Until the local basic chemical industry is better developed several of the chemical raw materials shall continue to be imported.
  55. 55. 42 3.5 Potential for Local Substitutes Nigeria is a richly endowed nation. There are potential local substitutes that can be used in the sector and other locally available raw materials that need to be upgraded to meet the quality required for the various industries in the sector. The 2006 survey on the sector identified the following raw materials that could be sourced locally. 3.5.1 Agro-chemicals and fertilizers The raw materials identified in this sub-sector in the 2006 survey were phosphate, limestone, ammonia, nitrogen, urea and ball clay. However, zinc and sulphur were partly imported. Nigeria has the capacity to produce Dextrin, Bone Glue, Gum Arabic, High Fructose Corn Syrup, Fatty acids and essential oils, if necessary funding is made available to commercialize the research results already obtained. Agro-chemicals and fertilizers are valuable inputs into the food security component of the 7 – Point Agenda and Vision 2020 of the present administration. Investment in these areas is therefore very critical. Phosphate deposits have been located in Sokoto and Ogun states. The deposits have been characterized as reported by the Nigerian Geological Survey Agency and Imperial Institute, London. The average P2O5 content which is a major characteristic of both granular and nodular phosphate was found to be 34.5-36.25%10/w. This compares favourably with the 36.6% obtained from phosphate rock imported from Togo. The Federal Super Phosphate Fertilizer Company, Kaduna, is sourcing a major part of its phosphate requirements locally. The only fertilizer company at Onne, Port-Harcourt which used to produce urea and ammonia has been closed down. However, with the privatization of the company, it is hoped that production of urea and ammonia would resume so that local sourcing of these raw materials would improve significantly. The Raw Materials Research and Development Council establishmed an industrial grade kaolin plant located at Gwarzo, Kano state. Kaolin deposits have been found across the country with their chemical compositions and other characteristics identified. Kaolin is used as a filler in the production of fertilizer with an estimated reserve of 2 billion tonnes of kaolin in the Country. More plants need to be established so as to sustain the supply of this input into the production of fertilizer. 3.5.2 Pharmaceuticals Pharmaceuticals can be obtained from natural sources such as plants, animals and microorganisms. They can also be chemically synthesized. However, the major sources of pharmaceuticals are plants. It is estimated that about 25% of the world’s pharmaceutical products are derived from plants. The National Institute for Pharmaceutical Research and Development (NIPRD) Idu, Abuja, has carried out extensive work towards development of local substitutes for imported pharmaceutical raw materials. One of such efforts has resulted in the development of a drug called NIPRISAN ,which is used for the treatment of sickle cell anemia. Similarly the Nigerian Natural Medicine Development Agency (NNMDA), Lagos has documented
  56. 56. 43 medicinal plants available for exploitation all over the country. Investors in this sector may avail themselves of these opportunities. Considering the limited capacity of developing countries to exploit medicinal plants, the United Nations Industrial Development Organization (UNIDO) has made available a list of 68 medicinal plants that could be utilized for the production of pharmaceuticals. The complete list of the medicinal plants is presented in the 2006 report (Table 4.15). The survey report of 2006 identified the following pharmaceutical raw materials are available locally – Maize starch, Acacia, Sodium Chloride and Caramel. Other raw materials identified as partially sourced locally were Dicalcium phosphate, Citric acid, Lactose, Calcium Carbonate, Carboxy Methyl Cellulose, Sodium benzoate, Petroleum jelly, Vegetable oil, Ferrous gluconate, Ferrous fumarate, Vitamin B12 and Vitamin C. The survey also indicated that of the 476 identified raw materials in the sub-sector only about 5% is sourced locally. This could be attributed to the sophisticated technology involved in the production of pharmaceuticals. 3.5.3 Soaps and detergents The raw materials for the sub-sector are organic, inorganic base and fragrance/colourants. The major raw materials for the soap and detergent sub-sector are oils and fats, specifically Palm Kernel Oil (PKO), Palm oil, Caustic soda, and Linear Alkyl Benzene. Both Palm kernel oil and Palm oil are produced in abundance in the country. However, caustic soda is imported despite large salt deposits identified at several locations in Benue and Cross River troughs, Ebonyi, Nasarawa, e.t.c. The Linear Alkyl Benzene, which is used in the production of detergent is produced by the Kaduna Refinery and Petrochemicals Company. Other raw materials that could be sourced locally are perfume, essential oils and colourants. For the Palm kernel oil and Palm oil which are sproduced from oil palm tree, there is the need to establish more plantations to replace the ageing ones. It is also imperative to develop improved varieties of the trees using tissue culture and genetic engineering to be able to meet the ever increasing demand for these raw materials. 3.6 Industries Operating in the Sector A total of sixty companies were covered in the sector during the 2006 survey. Six out of this number were in the Agro-chemicals and fertilizer, seventeen (17) were in the pharmaceuticals, thirteen were listed in the soaps and detergents while the rest belong to chemicals sub-sector and research and development institutions. In the 2003 survey a total of 153 companies were covered in the Agro-chemicals, pharmaceuticals and soaps and detergents sub-sectors. Eleven (11) in the Agro-chemicals, forty
  57. 57. 44 (40) in soaps and detergents and one hundred and two (102) in the pharmaceuticals sub- sectors. It is evident that about 58% of the companies listed in 2003 have either not been covered or closed down. 3.7 R&D Activities in the Sector Research and development in the chemicals and pharmaceuticals sector is capital intensive. Consequently, companies in this sector, mostly multinationals, conduct their R&D abroad. However, research institutes with mandates relevant to the sector have done significant works in trying to develop local substitutes for imported chemicals and pharmaceuticals. The National Institute for Pharmaceutical Research and Development(NIPRD), Idu, as mentioned earlier developed NIPRISAN for the treatment of sickle cell disorder. Efforts are targeted at the production of other local pharmaceuticals using the Institute’s pilot drug manufacturing facility. Similarly, the National Research Institute for Chemical Technology (NARICT), Zaria, has developed a number of chemicals from local sources. Adequate funding for R&D and linkages with user industry who would commercialise findings is required. 3.8 Recommendations The survey revealed that the wealth of natural resources could be developed into raw materials for the chemical and pharmaceutical industries. Unfortunately, these potentials have not been fully exploited. Most companies have relied heavily on imported raw materials, equipment and spare parts in addition to having low level of R&D based on the observed persistent problems. The recommendations are made under the following sub-headings: i) Production capacity and products ii) Research and Development iii) Mechinery and Equipment iv) Infrastructural Facilities v) Finance 3.8.1 Production capacity and products 1. Government should sustain the enabling environment created through the increased enforcement activities of NAFDAC and SON to curtail dumping of fake and substandard products. 2. Local manufacturing industries should establish formal relationship with relevant R&D institutions to conduct researches which are necessary to improve the quality of their products.
  58. 58. 45 3. Pharmaceutical companies should take advantage of the ban lifted on drugs made in Nigeria by Ghanaian and Sierra Leonean authorities to increase export of their products. 4. The Federal and State Governments should make it mandatory for their various health institutions operating Drug Revolving Fund (DRF) and service providers on NHIS to procure and use NAFDAC registered essential drugs produced by local pharmaceutical industries. 3.8.2 Research and development a) Government should envolve policies which will ensure that companies and relevant research institutes engage in R&D for local raw materials development. b) Research institutes/institutions of higher learning should be adequately funded and challenged with specific national priority projects to be completed within a given time frame. c) Companies, research institutes and other relevant institutions should be encouraged to collaborate on research and development of local raw materials. d) Government should identify areas of technology inadequacies with respect to base metals, plastics and ICT and make policies to address them. 3.8.3 Machinery and equipment a) The National Engineering Infrastructure should be developed. b) The Scientific Equipment Development Institute (SEDI), in Enugu and Minna, Projects Development Agency (PRODA), Enugu, African Regional Centre for Engineering Design and Manufacture (ARCEDEM), Ibadan and the Industrial Development Centres and other individual organisations should be upgraded. 3.8.4 Infrastructural facilities 1. Government should as a matter of priority make conscious efforts to improve shortages in power generation, fuel and water supply . 2. Government should facilitate the completion of Inter Modal Transport System to facilitate haulage of industrial goods. In addition, government should improve the facilities in telecommunication to make it more accessible. 3.8.5 Finance 1. A stable value of the naira should be sustained to facilitate strategic planning. 2. Financial institutions should be encouraged to grant medium and long term loans to industrialists and entrepreneurs to expand and establish industries.
  59. 59. 46 CHAPTER FOUR ELECTRICAL AND ELECTRONICS SECTOR 4.1 Introduction The ever-decreasing socio-economic and industrial activities in the electrical sector have been of major concern to the stakeholders, industrialists, scientists, entrepreneurs and the general public in the past years. In this sector, little or no effort has been made to adopt a strategy of promoting its rapid development. With successive governments, different policies were introduced to reduce dependence on imported electrical and electronic goods/ components. These have however, not been quite successful. The sector was divided into, five subsectors, along the lines of Multidisciplinary Task Force – Electrical and Electronics (MTF-EE) subdivision in 1989, to facilitate enumeration, viz: a. Electric Bulbs, Lamps, Fittings and Electrical Accessories sub-sector; b. Electronics/Telecommunications Equipment and Gadgetry sub-sector; c. Electrical Instrumentation, Power Control and Distribution Equipment sub-sector; d. Refrigeration, Air conditioning and Domestic Appliances(RADAMA) sub-sector; and e. Wire and Cable sub-sector. 4.2 Raw materials requirement The raw materials used by the industries in the sector are broadly categorized as a. Primary Raw Materials b. Completely Knocked Down(CKD) parts; and c. Semi-Knocked-Down (SKD) components. 4.2.1 Primary raw materials Some of the primary raw materials are obtained from local sources. These include clay, calcium carbonate, feldspar, adhesives, silica sand, paints, oxygen, PVC compounds, polyethylene, sulfuric acid, sodium chloride, carbon, soda ash, transformer oil, talc, starch, wood, aluminum bar/rod/cast, copper wires and cables, iron rods and bars, and tin. It should be noted that some of these are produced from imported raw materials. Examples include aluminum bar/rod/cast from imported aluminum billets and copper wires from imported copper billets. 4.2.2 Completely Knocked Down(CKD) parts CKD are the simplest components from which electrical/electronics products are built or assembled. CKD parts are normally supplied by the very big electrical/electronics manufacturing firms existing in the industrialized countries of the world such as Japan, Germany, United States of America (USA), Taiwan and so on. These firms regard this activity as another means of selling their products albeit in kit form and as a result expect buyers to purchase the kit as a whole regardless of whether they have need for all the contents of such kits. Thus, most of the completely-knocked-down(CKD) parts are imported. The few that are made locally(mostly from the imported raw materials) are cable logs,
  60. 60. 47 fuses, fuse holders, knobs, plastics frames, gaskets and insulators. A few carbon resistors made locally are being used by the informal sector. Semi-Knocked-Down (SKD) Components SKD parts are assembled from CKD parts employing in most cases specialized techniques and expensive machines both of which are not within the reach of the small-scale enterprises. SKD parts may be supplied together with CKD parts as kits or may be sold separately as sub-assemblies or spares. Apart from circuit breakers, loud speakers and relays, all other Semi-Knocked-Down (SKD) parts are imported.
  61. 61. 48 RAW MATERIALS SHORTFALL BETWEEN REQUIREMENT AT FULL AND CURRENT CAPACITIES Tabulated below are raw materials shortfall between requirement at full current capacities by various sub-sectors. TABLE 4:1 SUB-SECTOR: ELECTRICAL BULBS, LAMPS AND ACCESSORIES Most of the companies under this sub-sector have gone down. Only few companies are operating. Most of the basic raw materials are imported and the cost of production is too high. The cost of production in Nigeria is said to be nine (9) times higher than that of china, four (4) times that of Europe and two (2) times that of Ghana. With the near zero manufacturing activity in the sub-sector, employment level is also affected and Capacity utilization is below 35%. TABLE 4.2: SUB-SECTOR: ELECTRICAL POWER CONTROL S/NO. NAME AND ADDRESS OF FIRM RAW MATERIAL DESCRIPTION UNIT OF MEASUREMENT ANNUAL CAPACITY SHORTFALL % INSTALLED CURRENT 1. ELECTRICAL METER CO. NIG. PLC Plot 30 – 32, Light Industrial Area, P.M.B. 660, Zaria, Kaduna State. i. Electric steel strip in coil ii. Deep drawing steel strip in coil iii. Copper wire flat and round iv. Aluminium strip v. Brass section rod/sheet vi. Phenolic resin Kg Kg Kg Kg Kg Kg 88,400 58,740 47,320 8,460 59,820 229,260 33,400 23,863 19,223 3,437 24,302 93,137 62 59 59 59 59 59 S/NO. NAME AND ADDRESS OF FIRM RAW MATERIAL DESCRIPTION UNIT OF MEASUREMENT ANNUAL CAPACITY SHORTFALL % INSTALLED CURRENT 1. BENNETT INDUSTRIES LTD., Plot D, Ikosi Road, Oregun, Ikeja, Lagos State i. Cold rod steel sheet ii. Lamp holders in coil iii. Cables iv. Ballasts v. Grommetts vi. Polished Aluminium reflector vii. Tough heat resistant glass viii. UV protected plastic shade ix. Capacitors Tonnes Pieces Tonnes Pieces Pieces Tonnes Pieces Pieces Pieces 42.5 125,000 475,000 125,000 26,250 6,500 7,000 21,250 22,500 23.5 57,500 262,500 57,500 11,000 4,250 5,625 10,000 10,000 45 54 45 54 58 35 20 53 56

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