Nigeria's manufacturing sector contracted by about 10 per cent in September 2026, with the Current Business Performance Index dropping to 108.4 points from 120.4 points in August, according to the Nigerian Economic Summit Group. The decline reflected a contraction in the cement subsector alongside weakening performance across multiple industries, as manufacturers grappled with persistent cost pressures, tight credit conditions and operational challenges.
The manufacturing downturn presented a mixed picture within the sector. Food, Beverage and Tobacco remained in expansion but at a slower pace, while Textile, Apparel and Footwear performed more strongly than in August. However, contraction spread across Chemical and Pharmaceutical Products, Plastic and Rubber Products, Wood and Wood Products, Non-Metallic Products, Basic Metal, Iron and Steel, and Motor Vehicles and Assembly. Pulp, Paper and Paper Products held steady, and Electrical and Electronics recorded stronger activity.
Manufacturers identified energy shortages, inadequate raw-material supplies, high rental costs, tight credit conditions and infrastructure deficiencies as major constraints. These challenges increased operating costs and discouraged fresh investment. The NESG said the broader economy maintained its expansionary momentum, with the composite Current Business Performance Index rising to 117.8 points in September from 112.7 points in August. Trade delivered the strongest performance, with its index rising sharply to 128.5 points from 112.0 points in August.
Agriculture also supported economic activity, with the sector's index rising to 117.7 points in September from 110.5 points in August. Crop production and agro-allied activities recorded stronger expansion, though livestock activity slowed and forestry and fishing moved into contraction. Agriculture nevertheless faced inadequate financing, power outages, insecurity and infrastructure bottlenecks. Services activity slowed to 107.7 points from 112.4 points in August, though it remained in expansion territory.
The findings indicate that despite manufacturing's struggles, stronger trade and agricultural activity supported the broader economy. For savers, borrowers, business owners and investors, the combination of manufacturing contraction and tight credit conditions suggests an increasingly uneven economic recovery, with some sectors expanding while others face rising operational costs and shrinking activity.