‘NIGERIA NEEDS COCOA PRODUCTION BEYOND $0.55 BILLION REVENUE’
Capacity in cocoa grading to boost international competitiveness was the focus of a two-day workshop in Lagos.
Cocoa production is set to take a turn for the better as efforts are being made to support producers of the crop to improve grading to enable them earn premium prices at the international market.
To reposition the Nigerian cocoa industry, stakeholders have emphasised the need to increase quality and quantity of beans in the country by deploying new techniques of fermentation, drying and sustainable farming through organic methodologies.
They said increasing land area under cultivation and boosting yield with improved varieties would upscale yearly revenue to $1.1 billion from the present $0.55 billion by 2025.
The campaign targets exporters, inspection officers and farmers. The focus is on quality, especially among buying agencies and exporters.
More than 300 cocoa stakeholders, ranging from producers, exporters and processors to researchers, technicians and representatives of institutions supporting trade and investment, took part in the two-day event in Lagos.
It was organised by Starlink Global Limited and the Federation of Cocoa Commerce (FCC). The areas targeted were overall quality enhancement and improved productivity in the sector.
Declaring the event open, Chief Executive, Nigerian Export Promotion Council (NEPC), Mr. Segun Awolowo, said Nigeria earned $338.17 million from cocoa and cocoa products last year. Also, cocoa accounted for 20.8 per cent of total of non-oil exports.
He said Nigerian cocoa beans have being commanding high demand for decades.
He said: “Our cocoa is rated as some of the best in the world because of the flavour and aroma.”
He said in 2017, Cote D’Voire and Ghana could boast of production levels of roughly two million and one million metric tons.
According to him, Nigeria production still hovers around 245,000 metric tons.
“This low level of production is a result of many factors, including poor grading and quality related issues,” he said.
In line with the vision of the zero oil plan, Awolowo said the Council has intensified efforts at increasing production.
He said: “We have donated seedlings and agro input, including sprayers, agro chemicals, as well as organising capacity building, on integrated pest management for our cocoa farmers and processors. Workshops for cocoa famers and stakeholders were held in Akure, Ondo State; Osogbo, Osun State; Umuahia, Abia State; Uyo, Akwa Ibom State and Ikom, Cross River State.
“In addition to repositioning the cocoa industry, NEPC sponsored a team of Master of Business Administration (MBA) students of University of California at Los Angeles (UCLA) United States (U.S) to understudy the demand and supply situation of Nigeria cocoa in the U.S market. The researchers, he said, found that U.S is the world’s largest importer of cocoa beans; however, Nigerian exports represent only 3.3 per cent of it. It was also discovered that 91 per cent of Nigeria’s cocoa in 2016 was exported to the European Union (EU) for further processing.
He said: “Vertical integration of value addition into cocoa butter, powder and liquor can bring additional $150-280 million yearly.”
With African Growth and Opportunity Act (AGOA), he said there is a huge cocoa export market in the U.S.
He said the team recommended, among other things, that Nigeria increase land area for cocoa cultivation.
The team, he added, estimated that total production revenue could increase to $1.1 billion from $0.55 billion by 2025.
The Managing Director, Starlink Global Limited, Mr Adeniji Adeyemi, said when the Federal Produce recruited last year, the training started at his warehouse.
He said: “I realised that we need to advance from the 1959 Ordinance being used by the Federal Produce to the modern way of grading cocoa in line with Federation of Cocoa Commerce (FCC) rules.”
He said Starlink took the step to organise the workshop to keep all stakeholders in cocoa industry acquainted with FCC rules and regulations which govern the global cocoa economy.
“It is also our objective that this workshop and some others, Nigeria would take its rightful place in cocoa economy not just in Africa, but globally,” he said.
He said the transformation of cocoa industry into a sustainable economic sector presents a challenge to all the stakeholders involved, and stressed the need for cooperation between producers, governments, traders, processors and manufacturers to enable the industry achieve its full potential.
“There is need to regulate the commodities industry such that the government will have first-hand information to enable it takes decision to promote commodities trading in Nigeria,” he added.
A cocoa trader for Sucden, a global agro commodities organisation, Mr Thomas Roche, said quality control is a key capacity-building priority for exporters.
For Nigeria to earn premium price, he said exporters must learn how to grade and dry cocoa beans and recognise quality parameters according to international standards, train their workers to apply quality-control measures and maintain proper storage and transportation conditions.
He said exporters’ involvement in FCC could mean higher prices for cocoa exports.
A trainer, Mr Matthew Stolz, said FCC is a leader in the provision of training and education for the international cocoa market.
World Cocoa Producers Organisation Vice President Sayina Riman, who doubles as president of the Cocoa Association of Nigeria, said Ivory Coast and Ghana had agreed to a $400 per ton premium above global prices for their cocoa, and that Nigeria wanted to follow suit to protect its farmers.