Nigeria’s cocoa market value hits $6billion
The cocoa industry in Nigeria, long a cornerstone of its agricultural economy, is poised for a dramatic transformation as global cocoa prices surge to $10,000 per ton. Stakeholders highlighted the potential for Nigeria’s cocoa exports to generate an estimated $25 billion, a significant leap from the current $6 billion market value, during the 25th Anniversary and Awards Ceremony of Starlink Global & Ideal Ltd. in Lagos.
Alhaji Adeyemi Adeniji, CEO of Starlink Global, emphasized cocoa’s untapped potential to drive economic diversification. His company, in partnership with Odu’a Investment, is managing 25,000 hectares of farmland across West Africa, with two pilot sites already underway. Additionally, Starlink has acquired Nigeria’s largest cocoa processing facility, set to commence operations by April 2025, focusing on producing chocolate and cocoa drinks to enhance the value chain.
Chief Bimbo Ashiru, Chairman of Odu’a Investment Group, reaffirmed the importance of transitioning from oil dependence to agriculture-led industrialization. He stressed the revival of cocoa production, once a major export in the 1970s, as key to achieving food security and generating export surpluses. The strategy includes the establishment of agro-industrial hubs in the Southwest, prioritizing crops like cashew and cocoa to drive value addition and industrial growth.
Former President and AfCFTA National Coordinator, Olusegun Obasanjo, called on Starlink to position itself as an export trading company, leveraging agreements like AfCFTA to expand its reach across Africa. He commended the firm for its role in economic growth, emphasizing the need for stakeholders to capitalize on AfCFTA opportunities to unlock Africa’s agricultural and industrial potential.
As cocoa prices rise and investments in processing and infrastructure grow, Nigeria is positioned to regain its prominence in the global cocoa market. Stakeholders believe these efforts will not only diversify the economy but also strengthen the naira through increased foreign exchange earnings.
Source- The Nation
Expert Review for Agri-Food Stakeholders
Nigeria’s cocoa sector presents a golden opportunity for stakeholders to transform the country’s agricultural and economic landscape. The current surge in global cocoa prices highlights the need for robust strategies to maximize this potential.
Key Insights and Opportunities:
1. Value Addition in Cocoa Processing:
The establishment of cocoa processing facilities, like Starlink’s, signals a shift from raw cocoa exports to finished products such as chocolate and beverages. This will enhance foreign exchange earnings and create local jobs.
2. Infrastructure Investments:
Collaborative efforts, such as those between Starlink Global and Odu’a Investment, showcase how large-scale farming initiatives can increase production capacity while ensuring sustainability.
3. Leveraging Trade Agreements:
AfCFTA offers a platform to expand Nigeria’s cocoa exports across Africa, moving beyond raw commodities to value-added products. Stakeholders should align strategies to meet regional and international quality standards.
4. Policy Support and Industrialization:
Backward integration policies can drive industrial growth, ensuring that Nigeria becomes a net exporter of finished goods. Incentives for private-sector investments in agro-industrial hubs are critical.
5. Restoring Cocoa’s Historic Role:
In the 1970s, Nigeria was the world’s second-largest cocoa exporter. Reviving this legacy requires investments in research, extension services, and farmer support to boost yields and quality.
Stakeholder Action Plan:
1. Government: Implement policies that provide subsidies for cocoa farmers, streamline export processes, and incentivize value chain development.
2. Private Sector: Invest in processing plants and export-driven initiatives to enhance competitiveness.
3. Farmers and Cooperatives: Adopt sustainable farming practices and leverage training programs to increase productivity.
4. Financial Institutions: Provide accessible credit facilities tailored to agribusiness needs.
Conclusion:
The global cocoa price surge presents an unprecedented opportunity for Nigeria to re-establish itself as a global leader in the cocoa market. Through strategic investments, policy support, and collaboration, stakeholders can unlock the full potential of the cocoa sector, driving economic diversification, job creation, and foreign exchange stability.
