Nigeria’s dependence on imported iron and steel has come under renewed scrutiny after the country’s import bill for the products exceeded N1 trillion in 2025, raising fresh questions about the prolonged inactivity of the Ajaokuta Steel Complex in Kogi State.
The development has renewed debate over the need to revive Ajaokuta and establish a functioning domestic steel industry, particularly as Nigeria continues to spend heavily on imported steel despite its substantial mineral resources.
According to data from the National Bureau of Statistics (NBS), Nigeria’s iron and steel imports averaged about N526 billion annually in the six years preceding 2025. The figure, however, rose above the N1 trillion mark last year.
The official data covers recorded trade and may exclude unrecorded or under-reported imports, suggesting that the country’s actual dependence on foreign steel could be higher than reflected in the published figures.
Minister of Steel Development, Prince Shuaibu Abubakar Audu, has put the annual expenditure considerably higher, estimating that Nigeria spends about $4 billion, equivalent to roughly N5.6 trillion, on iron and steel imports each year.
The scale of the imports has brought renewed attention to the Ajaokuta Steel Complex, which was conceived as an integrated metallurgical facility with an annual production capacity of up to 5.2 million tonnes of liquid and finished steel products.
The complex was designed to produce heavy plates, flat sheets, wire rods, bars and structural shapes, alongside industrial chemical by-products. Its planned market extended beyond Nigeria to West African countries and, eventually, other African markets.
Steel remains a critical component of industrialisation, with applications across manufacturing, construction, transportation, infrastructure, defence, automobile production, housing, machinery and fabrication.
If fully operational, Ajaokuta could provide locally produced steel for manufacturers and downstream industries, while supporting mining, engineering, construction and transportation activities.
Analysts say a functioning domestic steel industry could also generate hundreds of thousands of direct jobs and millions of indirect jobs, reduce import expenditure, conserve foreign exchange and create opportunities for export earnings.
Speaking to Financial Vanguard on the state of Nigeria’s steel industry, President of the National Association of Steel Workers, Oyabugbe Sunday, said the country remains trapped in a cycle of exporting raw materials and importing finished steel products at significantly higher costs.
He said the situation limits domestic value addition, weakens industrialisation and contributes to substantial foreign exchange outflows.
Oyabugbe noted that industry estimates put Nigeria’s annual steel import bill at about $4 billion, although the figure varies depending on import volumes and international steel prices.
On the resources required to revive Ajaokuta, he said the company’s last audit reportedly indicated that the project was about 95 per cent complete, adding that approximately $1.5 billion would be needed to make the complex operational.
However, efforts to revive the facility through private-sector concessions have produced limited results over the years, with several arrangements under successive administrations ending amid controversies, failed agreements and legal disputes.
One of the major attempts came under former President Olusegun Obasanjo, when the Federal Government entered into a 10-year concession agreement with SOLGAS Energy Limited, an American company, in June 2003.
The agreement was intended to rehabilitate, complete, commission and operate Ajaokuta. However, the Federal Government terminated the concession in 2004, citing non-performance.
The SOLGAS deal also attracted concerns from experts who questioned whether the company had the technical capacity required to undertake a project of Ajaokuta’s metallurgical complexity.
Following the collapse of the SOLGAS arrangement, the government subsequently turned to Global Infrastructure Nigeria Limited (GINL), associated with Indian steel magnate Pramod Mittal’s Global Steel Holdings.
More than four decades after Ajaokuta was conceived as the cornerstone of Nigeria’s integrated steel industry, the country’s rising steel import bill has once again placed the complex at the centre of the national industrialisation debate.
For Africa’s largest economy, the issue goes beyond reviving an idle industrial facility. A functional steel industry could strengthen domestic manufacturing, deepen industrial value chains, create jobs, reduce dependence on imports and ease the foreign exchange burden associated with meeting Nigeria’s growing demand for steel.
