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Tomato Manufacturers Want More Time For Backward Integration

By Eno Bassey
07 February 2016   |   4:55 am
THE Union of Tomato Paste Manufacturers in Nigeria has appealed to the Federal Government to hold back on the Central Bank of Nigeria’s (CBN) forex policy in order to avail them more time for backward integration.
A tomato processing plant in Nigeria

A tomato processing plant in Nigeria

THE Union of Tomato Paste Manufacturers in Nigeria has appealed to the Federal Government to hold back on the Central Bank of Nigeria’s (CBN) forex policy in order to avail them more time for backward integration.

Triple concentrate, which is the major raw material for the production of packed tomato paste, was listed among the 41 items banned from accessing foreign exchange from the official window by the Bank. This policy has made it impossible for firms to import tomato concentrate, which in turn is having an adverse effect on the production of the product.

Speaking through the Managing Director, Sonia Foods Industries Ltd, Mr. Nnamdi Nnodebe, the manufacturers appealed for more time to further invest in backward integration in the country.

Nnodebe added, “We have begun the process of backward integration in some parts of the country but support for the process is critical to its success. We plead with the relevant government agencies to provide adequate support in terms of easy access to arable land, low interest loans, irrigation facility, technical and also infrastructural support. In the long run, we intend to establish a triple concentrate factory using locally harvested product, which would fill up the shortage of about 150, 000 MT in the Nigeria tomato paste market.

The tomato industry is one of the sub-sectors where Nigeria has an advantage and ranked second largest producer of tomato in Africa and 13th largest in the world producing 1.701 million tonnes of tomato yearly at an average of six metric tonnes per hectare, all of which remains insufficient to sustain the tomato paste industry in Nigeria.

The recent policy of the CBN, according to Nnodebe, would lead to approximately 100,000 job loss, increase in the product cost and ultimately the shutting down of some of the production companies, if this is not well managed through adequate time for backward integration.