Improving Cocoa Production

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Jonathan Eze writes on the need to incentivise cocoa farmers in the country, in order to support the federal government’s quest to diversify its revenue base

The Central Bank Governor (CBN), Godwin Emefiele, recently identified agriculture financing as the way forward for the economy. He explained that as part of its developmental role, the CBN has in collaboration with the federal government, represented by the Federal Ministry of Agriculture and Rural Development (FMAR), established the Commercial Agriculture Credit Scheme (CACS) for promoting commercial agricultural enterprises in Nigeria, which is a sub–component of the federal government’s Commercial Agriculture Development Programme (CADP).

The fund, he added, will complement other special initiatives of the central bank in providing concessionary funding for agriculture, such as the Agricultural Credit Guarantee Scheme (ACGS) which is mostly for small scale farmers, Interest Draw-back scheme, Agricultural Credit Support Scheme and other similar developmental initiatives.

According to Emefiele, “there was no need to allocate scarce forex to rice importers when vast amounts of paddy rice of comparable quality produced by poor hard-working local farmers across the rice belts of Nigeria are wasted, and farmers are falling deeper into poverty at a time the government exports their jobs and income to rice producing in overseas countries.
“Few decades ago, Nigeria was one of the world’s largest producers of palm oil but, today, we import nearly 600,000 metric tonnes while Indonesia and Malaysia combine to export over 90 per cent of global demand.

“Under these circumstances, I believe it is appropriate, and in fact, expected, that the CBN contributes to protecting the jobs and incomes of local farmers, using some of the same principles Western economies use to justify the protection of their farmers through huge subsidies,” he said.

Noting that agriculture remained the largest employer of labour, the CBN chief said the sector contributes about 24.2 per cent of the country’s Gross Domestic Product (GDP).
In the light of the CBN boss acknowledgement for adequate agric financing, the cocoa sector which has been blighted with many challenges in recent time needs urgent attention in order to thrive.

Cocoa was a major agricultural export crop and a top foreign exchange earner in the 1950s and 60s. Prior to the discovery of crude oil in commercial quantities in the 1970s, Nigeria was the world’s second largest producer of cocoa.

Average cocoa production declined from 420,000 tonnes in the ‘60s to 170,000 tonnes in 1999.
Production climbed to 389,272 tonnes between 2000 and 2010, but fell back to 192,000 tonnes in 2015 and 2016. After dropping to fourth place, Nigeria is now the sixth largest producer.
Cocoa is a household cash crop and key agriculture produce in Nigeria. It is used for local consumption and is also exported which generates foreign exchange for the country.
According to statistics, Nigeria produced 367,000 tonnes of Cocoa in 2017.The export data from 2017 shows that Nigeria exported 161,285.72 metric tonnes of agricultural produce. Cocoa export accounted for 33,294 out of this figure.

Given these figures, Nigeria is yet to tap into the potential of the cocoa industry in the continent when compared to Cote d’ Ivoire and Ghana. This makes Nigeria the third producer of cocoa beans on the continent and fourth behind Indonesia in the world.
However, the federal government has expressed desire to focus on moving up the ranks as the producer of the cash crop over the next five years.

The challenges facing the cocoa sector are so enormous. These are challenges that have impeded the success of the cocoa export at the international market.
Cocoa producers have not been able to meet the target set by the International Cocoa Organisation (ICCO), due to its challenges. Nigeria has been struggling to meet its target and as a result, the country losses $1 billion per year.
The Minister of Agriculture, Chief Audu Ogbeh has attributed this to negligence on the part of government over the past 30 years.
According to the minister, actual record of production and export are difficult to trace as they are not kept.

But according to Cocoa Farmers Association of Nigeria (CFAN), the challenges its members are facing are far more than record keeping.
The challenges include unfavourable weather conditions, lack of support from the government, and use of fake chemicals by farmers. There are no palliatives or incentives for the exports of cocoa in the country.

In Osun State, farmers were able to produce 30 per cent of the projected cash crop in 2017, with no support from the state government. This was due to unfavourable weather, fake chemicals and lack of funds and financial support from the government.
Farmers in the state lack funds and most times are unable to pay their labourers. These challenges facing the farmers have affected productivity and as a result, led to a decrease in cocoa production.

Beyond local acceptance, the Nigerian Export Promotion Council (NEPC) has advised cocoa farmers on the need to properly ferment their cocoa beans to achieve better production and gain acceptance in the world market.
The Executive Director of NEPC, Segun Awolowo, gave the charge at the opening of a one-day workshop for cocoa farmers in Ekiti, with the theme ‘Improving the quality of cocoa production for global competitiveness’.

The workshop organised by NEPC Akure zone was for the training of farmers on different methods of cocoa fermentation with the use of fermentation boxes.
Awolowo, who was represented by the Head, Trade Information Unit, NEPC Lagos, Mrs. Fransisca Odega, said the federal government was desirous to improve the production and export base of economy by increasing production, processing, packaging and marketing of non-oil export commodities.

He said, “Let me assure you that the federal government is committed to restoring the agricultural and industrial sector especially the cocoa subsector to its prime position before the discovery of crude oil.
“I therefore wish to use this occasion to call on all farmers and stakeholders to support and key into government policy of promotion of non-oil export as an alternative source of revenue.

“If all hands are on deck, the policy will not only boost our country’s economic growth and development but will serve as a road map towards genuine industrialisation and integration of our economy with other developed economies of the world.”
The Permanent Secretary, Ekiti State Ministry of Commerce, Kayode Abe, said the state government had disbursed N1.5 billion to business owners and farmers in conjunction with the central bank, out of the N2 billion approved for the small and medium scale enterprises in the state.

The Trade Promotion Advisor, Mr. Oluwole Monehin, advised farmers to ferment their cocoa beans for a minimum of five days to achieve better production.
“Many of them are in a hurry to ferment their cocoa; this reduces the quality of production. The minimum fermentation days range between five and seven days.
“It has been observed that addressing numerous challenges besetting smallholders in this subsector is germane to achieving expected results,” he added.

Climate change is another factor militating against the cocoa sector. Farmers along River Benue since last week are counting their losses after a flood incident that submerged hundreds of farmlands and destroyed crops across nine local areas in Adamawa State.
The flood caused havoc in several communities in Yola South, Yola North, Girei, Fufore, Numan, Demsa, Lamorde, Guyuk and Shelleng, among others, as houses were completely submerged in some cases for several days.

Jibrilla Marafa, the village head of Njoboliyo in Yola South Local Area, who spoke to journalists, said more than 100 hectares of farmlands in the village were washed way, saying the incident dashed the hope of the hardworking farmers in his domain.

The traditional leader called on the authorities at all levels of government to assist the affected farmers to ameliorate their suffering and avert food crisis in the area.
Thompson Bemi, a farmer and fisher man in Njoboliyo, lamented that since the incident, he had been jobless as all his investment in rice production was washed away while the fishing tools he used to complement his income were also lost.

Maaruf Boranji, a rice farmer in Boranji in Yola South, said he had expected a harvest of 50 bags of rice from his farm before the flood destroyed the crops, adding that the farm was developed with all the money he saved over the years.
The state Commissioner for Agriculture, Waziri Ahmadu , said the state had contacted the federal government with a view to getting some assistance for the affected farmers in the nine local areas hit by the flood.

He added that the state held and extended executive council meeting that included special advisers and assistants to Governor Muhammadu Jibrilla as well as permanent secretaries in order to have wider views on the best way to handle the disaster.
“The flood washed away crops that are planted in low land areas like rice, and in some cases maize. At the level of government, we at the Ministry of Agriculture have appealed to the federal government and they promised to assist. We are concerned because farmers could not harvest what they planted,” he said.

Despite the challenges, it is important, however, to recognise that the rate of economic growth can be accelerated if revenue earning agricultural commodities are given adequate attention. The urgent need for diversification of the economy requires unwavering action. An investment in the cocoa industry should be part of this strategy as Nigeria was once a powerhouse in cocoa production and has the land and favourable climate to sustain it.