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We’re at rock bottom in global oil palm production – Adewole


Mr. Taiwo Adewole, Managing Director Okitipupa Oil Palm Company (OOPC) Plc.

CBN’s Promise Of $500m Oil Palm Fund Is Mere Paper Talk
• Calls For A Palm Oil Trust Fund

Mr. Taiwo Adewole, Managing Director Okitipupa Oil Palm Company (OOPC) Plc. is worried that the promise by successive governments to return agriculture as a major revenue earner is yet to materialise. He is equally worried that the announcement by the Central Bank of Nigeria (CBN) more than a year ago, that it had 500 million dollar Fund for the oil palm sub-sector has remained a mirage. He spoke to GBENGA AKINFENWA on things to do to revamp agriculture.

What is responsible for the lackluster performance in the oil palm industry?
I THINK some stakeholders and players really don’t fully understand the economic advantage in agriculture and the industries that are attached to it, but whether we like it or not, for Nigeria to succeed as a nation, we have to go back fully into agriculture as a base for industrialization. There is nothing new we want to do that our forefathers did not do with an added commercial advantage.
 As a nation, we believe in a quick fix that has no root. And for how long shall we continue to deceive ourselves? My generation and those before me were sent to schools from the resources built from agriculture. That was my own experience. My grandmother had a cocoa plantation where we go to work every other day. Why in the name of civilization did we abandon what will sustain us for the things that have no foundation? And the earlier we returned the better for us.



Nigeria achieved the agricultural feat in the past because every family focused on agriculture and whatever they produced were partly consumed and the rest were sold which created a lot of economic activities, which also supported industries. If you look at the economy, the industry and agriculture failed consecutively; because, the foundation – agriculture – that would have been feeding the industries was not there. In fact, as we speak, I remember that my mother used to have a cotton farm and textile industries’ representatives were always coming around our farms to buy cotton. Where are the cotton firms today? Why will the textile industries not collapse? And suddenly, Nigeria woke up to realise that she became an import-dependent nation, waiting on the economy of other nations. In other words, we are sustaining the economies of other countries by relying on their products. It is the same spirit that destroyed Nigeria, whereby we produce crude oil for export only to import the finished products at about three times the value since we cannot refine by ourselves.

What do government and stakeholders need to do to put agriculture back as the backbone of the economy? 

The policies are there, but they should not only be on paper. That is, the government should create policies that are implementable. Like the CBN governor said over a year ago that it is going to spend 500 million dollars on palm oil. Where is the money? How many people have accessed it? You have key industries just like Okitipupa Oil Palm Company all over the place. 

You mean the 500million dollar announced by the CBN Governor is not yet accessible?

I don’t know how accessible the money is because we have an application there for almost a year now and there has not been any single communication from the CBN as we speak. There was an acknowledgment as we submitted physically but there has not been any written communication from the CBN to say we have pre-qualified you; this is the next stage of your pre-requirement. And it is not about showmanship; it is about rescuing the nation.  Because when you make pronouncement and two, three, four years down the line, there is no impact, what good are those pronouncements?


Did you make any effort to find out why CBN is not attending to your request?
We have a facilitator who interfaces with the CBN but we have not to see any response or result, we are interested in the result. 

The way I look at it is that, before a government comes up with a statement and have it published, they must have processes that they have to follow, they must also have expectations that at so, so period, we want to begin to see the results.


Are you saying that as a player and stakeholder in the industry, you are yet to see other players benefitting from this proposed CBN grant?
If there has been a significant change in the situation of things, Nigeria’s position in terms of global oil palm production output would have increased. I would have thought that Nigeria would look back at the time it was the largest palm oil-producing nation in the world.

Where are we now? 

We are nowhere. May be rock bottom. I don’t think we contribute up to two percent to the global market. That speaks volume and that is the product that is consumed by three billion human beings every day across 150 countries of the world. So, that tells us the level of our seriousness. And these are products that can bring significant economic impact to the nation, either in terms of job creation, servicing industries, and I believe we should take it with all seriousness it deserves. I am of the opinion that when you have a product like this, that can bring about significant change in virtually all spheres of life of a people, the government must take deliberate steps to get it working.
 We need about 1.5 metric tons of palm oil for local consumption but globally we are talking of hundreds of millions metric tons. To tell you how bad our situation is, Nigerian is not even self-sufficient, yet our government is paying lip service to this sub-sector that can lay the golden egg.

Are you talking to the government through your associations? 

We have the National Palm Oil Producers Association of Nigeria, to which I also belong. We talk to government at the state and at the federal levels and I believe they listen to us, but what they do after, we have no input or control of.
 That is to say, the governments formulate their policies but we are the practitioners who know where the deficits are and the challenges and I believe that if they allow us to advise them and be part of their policy processes and procedures, it will achieve more.

What are the associations or governments doing to assist small-scale oil palm farmers? 

Government has a special funding programme for them. 


How efficient is that?
How many of the smallholders have been able to access funds from either the state or federal government is a question that is answered by the country’s poor palm oil output. That is the reality today. Some of these smallholders are going through various forms of challenges, like land preparation problems. They are not able to finance land preparation activities, they are not able to get high-yield improved seedlings, they are not able to get equipment.
 So, all of those things are there. If you don’t help them, there is no way they can expand or sustain palm development as smallholders. And coordinating them will become very difficult.

What I think the Federal Government should do is to look at the trickle-down effect, ensuring that the big players should coordinate the smallholders to channel their funding strategy in their catchment arrears. That will make it administratively efficient. 

Since it appears government funding has not translated into action, what is the alternative for funding?

The banks don’t have the capacity to fund agriculture to the level it should be funded and if the finance cost is too high, then it becomes an unprofitable venture for the farmer. That’s why for agriculture, the government knows that it cannot do more than the single-digit interest rate. So, how many banks in Nigeria today can give money at a single digit?

But we have specialized banks set up by government for funding purposes. What happens to them?

I know there is Bank of Agriculture but I don’t know whether it has any funding, because I don’t think their presence is felt anywhere. I have not seen anybody walking towards any Bank of Agriculture for the purpose of funding. We have one in Okitipupa, it is as redundant as anything.
 I know how a living bank looks like. The way the bank of Agriculture in Okitipupa has presented itself, you will not be encouraged to approach them, for me, it will be a sheer waste of time to go in there.


In the circumstances oil palm farmers have found themselves in terms of funding, will you be asking for a Palm Oil Trust Fund?

The questions you raised will take us to what we have done to change the fortune of OOPC. When the restructuring started, we felt that much of what we needed to do would be to source for loans to be able to turn around the fortunes of the company; and desperately we were looking for money from various sources. However, because the opportunities were not yielding fruits, we started looking inward in the direction of the asset we have. Why don’t we look at them more closely to see how we can tinker with our processes and the strategies that we have and see whether that can activate the internal resources that we have; fortunately for us, in December 2018, we took a bold step to change our entire operational strategy and today OOPC is generating money these last five years put together, that was not generated, even without borrowing money.

For us as a country to improve on our capacity and output and to return the country to her past glory of being the number one palm oil producer in the world, I will not hesitate to call for a Special Oil Palm Trust Fund. Modalities for contributing this fund could be worked out between government, the players and other critical stakeholders.



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