How crude oil economy, governance failure put cocoa production at bay
Fresh cocoa pods. PHOTO: Google image
• Local processing capacity threatened by power failure
• ‘Lack of industrialisation, poor local consumption hamper productivity
• Stakeholders demand re-introduction of Cocoa Board
Despite the contributions of cocoa to Nigeria’s economy and its potential to do better through higher production, value chain development, local consumption and export, this subsector of agriculture has remained neglected and underutilised.
In 2021, Nigeria exported cocoa beans worth N209.89 billion to the international markets, which translated into 41.6 per cent of the total export earnings, the second after crude oil, as reported by the National Bureau of Statistics (NBS).
Cocoa research specialists, breeders and other stakeholders have identified factors such as poor quality of inputs (agrochemicals), little or no use of fertiliser, cultivation of older and low-yielding varieties and lack of incentives to farmers as some of the factors affecting production.
Of these factors, poor financing, lack of a coordinating body and low uptake of newer varieties of seedlings to rehabilitate old and cultivate new plantations, appear very prominent as identified by various stakeholders.
The challenges have displaced the country from being the second-largest producer of cocoa beans to the fourth, overtaken by Cote d’Ivoire, Ghana and Indonesia.
Cocoa production data sourced from NationMaster.com revealed that since 2014, cocoa beans production by Cote d’Ivoire ‘increased to 4.6 per cent year-on-year.’
The country produced 2,022,064 (2.22 million) metric tonnes of cocoa beans in 2019, making it the number one of the major cocoa-producing countries in the world.
Ghana ranks second largest producer in Africa and globally. Cocoa beans production in the country increased by 2.2 per cent year-on-year since 2014, and in 2019, Ghana produced nearly a million tonnes (957,413 metric tonnes).
Nigeria’s cocoa production, according to the data, nosedived by 0.3 per cent year-on-year since 2014, and the production figure as of 2019 was estimated at 324,458 metric tonnes, ranking number three in Africa and number four globally.
Nigeria has been overtaken by Indonesia, which currently ranks the number three globally with a yearly production of 607,012 metric tonnes as of 2019.
Cameroon ranks the fifth in cocoa bean production, globally, with 314,879 metric tonnes as of 2019, closely followed by Brazil (237,571 metric tonnes), Sierra Leone and Jamaica.
What cocoa did for Nigeria
ACCORDING to many historical sources, cocoa was a dominant foreign exchange earner for Nigeria from the 1950s up to the early 70s, making the country rank the second-largest producer after Ghana.
However, crude oil exploration and commercial production made the attention of the government and investments shift from cocoa and other cash crops, hence the gradual decline in its production. This situation has affected virtually all the sectors of the economy, including the oil/gas sector itself.
The Guardian gathered that the first set of cocoa plantations in Nigeria was discovered in Bonny Island (Rivers State) and Calabar (Cross River State) as early as 1870.
It was, however, recorded that the areas were not suitable for its production as a result of excessive water and soil texture.
Around 1880, historical documentation said cocoa plantations were established in Agege, Lagos State, and Ota, Ogun State, where the crop was successfully cultivated.
Information was said to have spread to other parts of the southwest region following success stories in Agege and Ota, and so, was the spread of the cultivation of cocoa in the region.
Cultivation rapidly got to Ibadan, Oyo State (Moor Plantation) and Egbaland, Ogun State, in 1890, and from there to Ilesha in Osun State and Ile-Oluji/Okeigbo and Ondo town in Ondo State around 1896. Afterwards, farmers in Ife and Gbongan in Osun State and Ekiti State embraced its cultivation.
Two early varieties cultivated then were Amelonado cacao (green pod turning yellow when ripe) from Amazon River Basin in Brazil and a heterogeneous strain (turning red when ripe), which was traced to have originated from Trinidad.
While it lasted, the cocoa marketing board, in particular, was said to be instrumental to giant strides recorded by the southwestern foremost visionary leader, Chief Obafemi Awolowo, leading to the construction of the famous Cocoa House, the establishment of the first television station in Nigeria and Sub-Saharan Africa, as well as establishment of University of Ife (Obafemi Awolowo University).
Standing on 1.7 hectares of land in the heart of Ibadan, Oyo State, and inaugurated on July 30, 1965, the 26-storey Cocoa House, initially called ‘Ile Awon Agbe’ (Farmers’ House), was constructed by Cappa and D’Alberto as the first known skyscraper in tropical Africa.
The funds came not from allocations from the Federal Government but from proceeds from the exportation of cocoa beans under the leadership of Chief Awolowo through the Action Group’s cardinal programmes for Southwestern Nigeria.
The building hosts the corporate headquarters of the Oodu’a Group of Companies, initially established in 1976 after Oyo, Ogun and Ondo states were created from the old Western Region to primarily “convert agricultural materials to finished products, to create employment opportunities for citizens of the region, to reduce dependence on imported items and to generate revenue for the government to fund its electoral promises.”
Challenges of production
STAKEHOLDERS have traced the liberalisation of cocoa marketing and trading to the decline in cocoa beans production in Nigeria following the recommendation by the World Bank (WB) and the International Monetary Funds (IMF), in 1986, leading to the abolition of public-managed commodity marketing boards.
The marketing boards purchased beans at agreed prices, thus, avoiding market fluctuations, disseminating information on good agricultural practices, market demand, and new technologies, and supplying quality inputs to farmers.
Allegations of sharp practices identified, stakeholders said, were not enough justification for the abolition, which, they said, had caused more harm than good to the cocoa production and value chain development.
Also, poor local utilisation of cocoa and value chain development is identified as a disincentive to greater production and productivity. Agro-economists have insisted that until the country processes and consumes cocoa and other cash crops, maximising production, creating jobs and improving the foreign exchange earnings through agriculture will remain a mirage.
The President of the African Development Bank (AfDB), Dr. Akinwumi Adesina, an advocate of agro-industrial development through value chain activities, believes that with cash crops such as cocoa, coffee, cotton cashew and other crops, Africa should add value and avoid exporting raw materials when it can maximise benefits of industrialisation of such crops.
He had said in a lecture that it made no sense that Africa accounts for over 75 per cent of world cocoa production but gets about 2 per cent of the over $100 billion market. Price of cocoa beans goes down, but the price of chocolate never goes down, he argued.
About 80 per cent of cocoa beans produced in Nigeria are exported as raw material.
Of over 15 cocoa processing companies in the country around 1986, only about five are still operational but grossly below installed capacities. The five include Oluji Cocoa Products Ltd, Ile-Oluji, Ondo State: Plantations Industries Ltd, Akure, Ondo State; Johnvent Cocoa Processing Company, Akure; Cadbury Cocoa Company, Ondo and Tulips Cocoa Industries, Ijebu-Mushin, Ogun State.
The Board Chairman, Cocoa Research Institute of Nigeria (CRIN), Ibadan, Alhaji Abdulahi Jao, in an interview with The Guardian, said the advice to scrap the cocoa coordinating body and Nigeria’s compliance was the genesis of the dwindling fortune of cocoa production.
“But Cote d’Ivoire was said not to have complied fully. Ghana rejected the neo-colonial advice. The results are there for all to see today. Those countries that refused the egregious notion are in the millionaire group of global cocoa production today,” Jao said.
The Executive Director, Cocoa Research Institute of Nigeria (CRIN), Dr. Patrick Adebola, while x-raying the challenges confronting cocoa production during an interview with The Guardian, established a link between the dying cocoa processing companies and low local production.
“I think if we really want to make the cocoa sector to be very vibrant, we have to encourage local consumption. Nigerians have not imbibed the culture of eating cocoa-based beverages, including chocolate,” he explained.
Adebola said the population of over 200 million could catalyse greater production, if Nigeria would encourage local consumption through school-feeding programmes and consumption of cocoa-based products, saying, “we will see a turnaround in the cocoa sector. The demand will be there and farmers will always smile to the bank.”
Cross River
THE Cross River State government, in the last few years, has continued with its cocoa rejuvenation despite challenges. Currently, the state produces over 155,000 metric tonnes of cocoa yearly.
Also, a multi-billion naira cocoa factory in Ikom is ready for use, however, due to misunderstanding between the state government and major financiers, it has not been commissioned even as farmers in the state who spoke with The Guardian have complained of poor government assistance in terms of implements, agro-chemicals, extension services and financing.
A cocoa farmer in Akamkpa, who gave his name as Ochot, said the state government was only engaging in mere propaganda.
He said, “I have not received any assistance from the government. Cost of everything like chemicals spraying machines and others are very high and this makes it difficult for us to expand our farms.”
The former national president of the Cocoa Association of Nigeria (CAN), Mr. Sayina Riman, said: “In terms of large cocoa production and expanding farms, it is lip service. It is more propaganda and less work in the field. There is always propaganda of gathering farmers together and making them look like there is government intervention. If there is, the government should show you a development index. When last did they go into development and which farmers did they give? If you come to the field, you will not see any true and non-political farmer saying they have received any form of government assistance.”
He added, “Agrochemicals are extremely costly now. Since 99.9 per cent of them are imported, prices are high. Even though farmers still see it as encouraging at N1000 per kg, the price of cocoa beans is not sustainable with the cost of inputs.”
Riman advised the government to subsidise inputs for farmers as one of the major challenges. “When we had that long drought, there were fire incidents in the farms and no farmer was supported in any form, not even by sending a message of sympathy or the promises they will end up not fulfilling. If the government wants to increase production, there are other variables but most importantly, the government has to start now to employ extension officers for our farms, which is in our 10-year action plan.”
He claimed that though there is no data, Cross River State is higher than Ondo in cocoa production right now. His words: “We are in the neighbourhood of 155,000 metric tonnes yearly. When you talk to Ondo, they will tell you it is Cameroun cocoa, but we do not have one Camerounian cocoa in Nigeria. Everything Nigerian cocoa is Nigerian cocoa.”
Also, Special Adviser to the Governor on Cocoa, Mr. Godwin Ofuka, said: “We are the leading cocoa producing state in Nigeria now despite the challenges we have. On assumption of office as the Special Adviser under the leadership of Prof. Ben Ayade, his emphasis had been on cocoa development and because of that special emphasis, he created the Department of Cocoa Development and Control for the first time and appointed me as the special adviser.”
He said farmers had been sensitised and they had been replacing the old trees with new ones that can grow in 18 months and yield over 1.5 metric tonnes.
“Right here in Calabar, we have been able to establish a model cocoa farm at the CICC Model Farm, where we have raised millions of seedlings and distributed them to cocoa farmers in the southern senatorial district,” he said.
Ofuka, however, said a major challenge is that cocoa farmers find it difficult to cut down the old cocoa trees for them to plant improved seedlings, wondering why they should cut down trees they had been harvesting over the years.
He said: “That is why we opened up this new plantation in Calabar and we have been able to raise seedlings over the years to distribute.”
He also admitted that farmers have been unable to access enough loans, and cocoa cultivation is capital-intensive.
“So, we need to be exposed to foreign loans and incentives. The cost of chemicals used to maintain cocoa is on the high side. So, farmers now resort to using adulterated chemicals to spray cocoa trees, which can cause them to bring forth fruits in the interim but after some time, the aftermath effect is that the trees die, which is a very big problem.”
Ondo
ONDO State, a reference point in cocoa production before and after the discovery of crude oil, appears to be groping in the dark without any articulated policy direction.
The administration of Governor Oluwarotimi Akeredolu, after 63 months in office, has not come up with a clear policy on cocoa production.
As projected by the immediate past administration, led by Dr. Olusegun Mimiko, in its Cocoa Revolution Project (CRP), the state appears to have derailed.
It was gathered that CRP, now run by the Secretary, is in limbo, as civil service politics has left the agency without a direction.
Another insider, who spoke anonymously, said the civil service bureaucracy and other attendant clogs have hampered cocoa production.
Actions of the Senior Special Assistant to Governor Akeredolu on Agriculture, Chief Akin Olotu, show a departure from moves to consolidate on the previous CRP achievements in cocoa production.
However, Governor Akeredolu approved the establishment of 2000 hectares of the hybrid cocoa plantation at Ijugbere town, in Owo Council of the state, but the growth in cocoa production has not been seen.
Some farmers said most of them are now selling their farmlands for residential purposes, especially in Idanre, Oda and Ofosu axes, which used to place Ondo State on the map as the highest cocoa producer in Nigeria.
Some cocoa farmers in Ofosu, Idanre Council of the state, at a time, protested against the alleged sale of their farmlands to a Chinese company by the state government.
Major partners of cocoa production in the state, Olam Nigeria and the Foundation for Partnership Initiatives in the Niger Delta (PIND) have drastically reduced their activities in the state.
In 2019, PIND planned a five-year cocoa programme in the Niger Delta to create global linkages and communication to end poverty.
The PIND Executive Director, Dr. Dara Akala, at a cocoa stakeholders’ roundtable meeting held in Akure, had lamented that the nation was rated the seventh position in the world and fourth in Africa after countries like Ghana, Cameroun and Cote d’ Ivoire.
Despite all these opportunities, Ondo is yet to make significant progress in cocoa production.
Successive governments have made efforts to resuscitate old farm settlements, which are 1,744 hectares, according to the archives in Ibadan and Cocoa Catalytic Industry, Idanre, as production and processing hubs of the cocoa beans produced in all the farm settlements across the state.
The former CRP boss affirmed that cocoa could survive in the 18 councils of the state, recounting his experiences in Arganrigan, Owo LGA, Northern Senatorial District, where hundreds of prosperous farmers were trained and the propitious boom in Agbaje, Ese-Odo LGA in the South Senatorial Districts.
Abia
Cocoa farming in Abia State is wobbling. But a government Cocoa Transformation Committee (CTC), which has the state deputy governor, Dr Ude Oko Chukwu, as chairman is in place.
The reasons for the poor state of cocoa include climate change, operating environment, absence of government support, unfavourable selling prices, poor access to farms and high inputs processing, costs, among others.
Both farmers and marketers are of the opinion that the government has not done the needful to boost cocoa production.
An Umuahia-based member of CAN, Chief Onyemachi Ejike of Ejikx Ventures, who has been in the cocoa business for more than 20 years, said there was low cocoa output during the last season due to climate change.
He was optimistic that with early rain this 2022/2023, the output would improve.
Asked what is the level of support by the government to farmers, Ejike said, “there is no government assistance or support in the last eight years.”
The state chairmen of the Cocoa Farmers Association of Nigeria (CFAN), Mr Uche Chudi, said the state government has not rendered any form of assistance to the commodity farmers and marketers in the past eight years.
“We are on our own. Our major problem has been bad weather for cocoa. Marketers even help farmers with inputs sometimes, giving them money to do the needful to enable them to procure seedlings and plants. Storage facilities are lacking. Hence, storage has been difficult. We are already approaching the government to grant us import waivers to enable us to import and build storage facilities,” he said.
Oyo
IN Oyo State, cocoa farmers have continued to decry the neglect of the sector by the government, the high cost of farm inputs and others.
The Oyo State Chairman of Cocoa Association of Nigeria (CAN), Alhaji Oladayo Muniru Ola, who spoke with The Guardian lamented that the high dollar rate, the prohibitive cost of inputs, high cost of manpower and lack of government support have taken the shine off the once-lucrative occupation.
He said: “Cocoa production used to be a lucrative business but a high rate of dollars has made farm inputs soar and the price of the finished products from cocoa has gone up while the price of cocoa remains the same. It is even dropping. It is being sold N1. 1million per tonne.
“The majority of our cocoa is exported. When Naira was around N230 per dollar, a tonne of cocoa was being sold at N1. 3 million. Now, notwithstanding that dollar to naira has gone up, coupled with a rise in prices of inputs, insecticides, fungicides and herbicides, the price of cocoa still remains the same or has gone down.
“To make one tonne of cocoa, we need a lot of manpower. We have to pay labour wages. Before, the workers used to collect N150, 000 per annum but now they collect N300, 000.”
He said: “Oyo State government is doing nothing. The Tree Crop Development unit says there is nothing coming from the Ministry. While campaigning, the Governor promised to do something for cocoa farmers but he has not done it.”
While urging the government to support the sector, the cocoa farmers’ leader said the benefits of effective cocoa production are enormous.
The way forward
A REPORT tagged, ‘Cocoa Production in Nigeria: A Literature Review,’ In Food & Agribusiness, states, “in spite of Nigeria being considered a major contributor to cocoa production, the industry is precarious and requires strategic interventions if it is to become the productive resource that the government wants to make it.”
The report recommends, “strengthened governance of the cocoa value chain. Large off-takers should be helped – utilising industry studies and preparation of a sector strategy – to see the potential for generous returns on investment and policy documents should highlight this as well as make provisions for appropriate mechanisms for regulating the sector, including prioritising certification of farms, seedlings and products.”
The National President, Cocoa Farmers’ Association of Nigeria (CFAN), Comrade Adeola Adegoke, while inaugurating The Cocoa GAP Handbook in Ondo State recently, affirmed that cocoa beans earned the highest foreign exchange earnings, apart from crude oil.
He said: “The cocoa value chain provides incomes to more than two million cocoa-connected families, and there is over $100 million investment in the sector.”
He, however, lamented the challenges, saying the country could do better in production.
“In our recent activities to enhance and push forward cocoa production from the current over 300,000 metric tonnes and expand our average low productivity from the present 350/400kgms, the association participated in the 2020 CBN Cocoa Anchor Borrowers’ Programme, when about 1,222 cocoa farmers benefited across nine cocoa-producing states at N593,000 for three-hectare cocoa farm maintenance per beneficiary.”
He said more needed to be done to reclaim pride of place for the cash crop.
Adogoke said good agricultural practices and new planting materials would help rehabilitate older plantations, which, in turn, would help to rev up the production figure to about 500,000 tonnes by 2024 and 1.0 million tonnes by 2027.
“It is, therefore, our belief that the Cocoa GAP handbook would take care of the noticed gaps in our cocoa affairs and provide our cocoa farmers with smart adaptation strategies to mitigate the challenges.”
The CRIN boss, Adebola, also suggested: “We should not just rely on harvesting the cocoa beans and exporting them. We should try to encourage local consumption. Then, it will translate into more local industrial activities and it will generate a lot of employment. When you take one bag of cocoa beans out, you take some jobs to the country you are sending it to. So, encourage local consumption, encourage value addition at home and that would make the cocoa sector very vibrant.”
He also called on the government to restore commodity boards for cash crops, to include stakeholders in the public and private sectors, as well as the academia and farmers.
“So, the government must come to our aid, bring back the cocoa board which will regulate in terms of what type of chemicals farmers can use on their cocoa farms and regulate the quality of the cocoa beans, among others.”
The Cocoa Framers’ Association of Nigeria also supports the re-introduction of a cocoa coordinating body, with a special financial system for cocoa and other cash crops.
Related
Latest
Get the latest news delivered straight to your inbox every day of the week. Stay informed with the Guardian’s leading coverage of Nigerian and world news, business, technology and sports.
0 Comments
We will review and take appropriate action.