News in brief:
– Nigeria’s cocoa exports increased by 304% in Q1 2024 due to high demand and naira depreciation.
– Despite revenue growth, cocoa production remained stagnant, highlighting the need for sustainable practices.
Nigeria’s cocoa exports have soared by 304% in the first quarter of 2024, according to data from the National Bureau of Statistics (NBS). This dramatic increase, driven by a combination of higher global demand and the depreciation of the naira, highlights the country’s growing role in the global cocoa market. Cocoa, which is a key export crop for Nigeria, accounted for 42.4% of the nation’s agricultural exports, totaling ₦438.7 billion in the first quarter of 2024, compared to ₦108.6 billion in the same period of 2023.
One of the main factors behind this surge is the significant increase in cocoa prices, which rose by over 567% in Q1 2024. For the first time, cocoa was sold at over ₦12 million per metric ton in Nigeria. This price hike is largely due to supply deficits from major cocoa-producing countries like Ivory Coast and Ghana, which have disrupted global supply chains. As a result, Nigerian farmers have begun to revitalise old cocoa plantations and plant high-yielding seedlings to boost production.
For farmers, the price rally represents a golden opportunity. Farmers like Sayina Riman from Cross River State have seen their revenues increase by up to 200%, prompting them to invest more in their farms. Many have started using better farming practices, such as applying liquid fertilisers and pruning undergrowth, to maximise their yields.
However, experts warn that the current price boom may not be sustainable. Oba Dokun Thompson, a chocolate manufacturer, and chairman of the Eti-Oni Development Group, cautions that as other regions ramp up their cocoa production, prices could drop within the next two years. He urges farmers to focus on value addition, which involves processing cocoa into products like chocolate, to ensure long-term profitability.
Production stagnation: a cause for concern?
Despite the revenue boom, production levels in Nigeria have remained stagnant at around 280,000 metric tons, making the country the world’s fourth-largest cocoa producer. Considering this stagnation, Mufutua Abolarinwa, national president of the Cocoa Association of Nigeria, argued that the surge in export value is a result of the high exchange rate rather than an actual increase in production.
The cocoa market is highly volatile, and while price surges can bring short-term gains, sustainable farming practices and value addition are key to long-term success. For countries looking to expand their agricultural exports, Nigeria’s focus on reviving plantations and investing in high-yielding crops offers a blueprint for maximising revenue in a fluctuating market.
