Repositioning Nigeria's Cocoa Industry for Sustainability
Nigeria might be poised to regain its competitive edge among cocoa-producing countries. However, this resurgence could be short-lived if the government continues to rely on rhetoric without taking concrete actions to create an enabling environment for the agriculture sector.
To achieve its ambitious goals, the Federal Government recently announced its intention to increase cocoa production from 340,000 metric tonnes to 500,000 metric tonnes by 2025, aiming to boost foreign exchange receipts. At the recent Pre-National Trade Dialogue series in Abuja, Nura Rimi, the Permanent Secretary of the Federal Ministry of Industry, Trade, and Investments, stated that this target would be reached through strategic partnerships with the International Cocoa Organisation and the African Cocoa Fund. This is a commendable objective.
According to the National Bureau of Statistics, the value of cocoa earnings soared from N107.6 billion in Q1 2023 to N171.2 billion in Q2 2023, and further to N408.7 billion in Q1 2024. Despite ongoing economic challenges, the dollar value of cocoa exports led to an impressive 279 percent increase in revenues.
The government’s resolve to boost cocoa production is feasible if it ensures the safety of farmers, who face threats from Fulani herdsmen, kidnapping, and banditry. The security of farmers is essential for food security and the expansion of cash crop exports.
Additionally, the government should enhance rural-urban road links to facilitate the transport of raw cocoa to export centers and chocolate and beverage factories. It should also eliminate burdensome taxes that stifle farmers’ profit margins.
Nigeria should prioritize agriculture. During the First Republic, regional governments relied on income from palm oil, peanuts, and cocoa to generate sustainable revenues and foster competitive socioeconomic development. Before the discovery of crude oil at Oloibiri in Bayelsa State in 1956, Nigeria was a leading producer of palm oil and second only to Ghana in cocoa production. Unfortunately, Nigeria now lags in cocoa production, ranking as the fourth-largest producer with 280,000 metric tonnes in the 2022-2023 season, according to the ICCO. Ivory Coast (1.8 million metric tonnes), Ghana (750,000 metric tonnes), and Indonesia (641,000 metric tonnes) outperform Nigeria.
In South-West Nigeria, a region where cocoa production flourished in the 1960s, the government of the old Western Region capitalized on global demand for cocoa. This spurred industrialization and provided free, quality social services in education and health. The imposing Cocoa House in Ibadan stands as a testament to the potential for sustainable and beneficial economic growth. Unfortunately, the governors of the South-West states have abandoned this legacy in favor of relying on federal allocations. This must change.
States should explore the natural resources within their territories instead of over-relying on federal allocations. They should collaborate across regions to achieve robust social and infrastructural development.
To achieve the target, a holistic and seamless strategy must be implemented to revitalize the cocoa industry. Farmers, local industries, and SMEs in the cocoa value chain should be incentivized to enhance the industry. This will significantly address the employment deficit in the country.
With soaring global demand for chocolate, Nigeria’s foreign exchange earnings and foreign direct investment will improve if the government adopts best agricultural practices and feasible export regulations for cash crops. The government should leverage existing research from agricultural institutes to provide improved seedlings resistant to pests, tree, and pod diseases. It should also invest in further research and development to enhance yield per hectare. For Nigeria to meet its target, extension service agents should educate farmers on the use of the right tools, fertilizers, and processes.
