Poor funding of seedlings and an increasingly harsh business environment marked by over taxation have undermined the cocoa processing industry, according to the Cocoa Association of Nigeria.
In an interview with The PUNCH, CAN President Mufutau Abolarinwa noted that the high cost of production in the country diminished the number of cocoa processing companies and called for government support.
Recently, the Federal Government emphasised cocoa processing, especially chocolate production. Abolarinwa, who named only a handful of active cocoa processing companies which could make chocolate, said, “There is a chocolate-making factory in Ondo State and other smaller factories across the country. They are part of the CAN, and they need support from the government.
“We had a high number of cocoa processing companies in Nigeria in the past. Most of them are moribund. They are crashing because they cannot compete. They cannot function well. The existing ones are bleeding.”
According to CAN’s president,sa, the high cost of cocoa production affects all cocoa value chain actors, farmers and processors. “One of their major issues is funding. Beyond funding, the cost of producing cocoa is too exorbitant because of power and other factors,” he said. “The farmers don’t have enough money to buy chemicals and other items.”
The CAN explained that government oversight of the cocoa industry, while necessary, was increasingly injurious to the sector. He also decried the overtaxation of the cocoa players by subnationals.
Abolarinwa said, “For a processor to move cocoa from Ikom, Cross River State, to Lagos is so expensive. There are many agencies along the way, on the road. After you have paid your duly regulated fee to the Federal Government, state and local governments will introduce another fee.
“They are creating roadblocks and charging fees on the cocoa that comes from their state. The cocoa trade is not free because of this unnecessary corruption. A serious government ought to tackle this menace.”
He decried the disruption in the ease of doing business in major cities such as Lagos. “Even within Lagos, from Berger to the ports, so much money is lost to touts who block the containers on the road. This is besides the agencies that are in the ports,” Abolarinwa lamented. “All levels of government have never given cocoa farmers and the processors the ease of doing business in Nigeria. It’s only said on paper.”
For CAN’s president, the harsh state of doing cocoa business makes it “easier for me as a Nigerian to buy cocoa in Cameroon or Togo, or buy it in Ghana, to ship it in Ghana.” He called on the government to adopt a holistic approach to solve the problem.
He recommended that the government harmonise the taxes and fees it charged, lamenting the multiplicity of regulatory agencies, as he pondered, “All these agencies should be merged into one so that we know who is involved. We have the Nigerian Agricultural Quarantine Service and the Federal Produce Inspection Service. Yet, the National Agency for Food and Drug Administration and Control wants to charge money. What is their responsibility there?
“So many organisations want to be involved. And everybody is interested in charging money. Meanwhile, these charges only increase the cost of production.”
He urged the Federal Ministry of Agriculture and the Federal Ministry of Industry, Trade and Investment to improve their support for the cocoa farmers, as the recently federally approved National Cocoa Management Board goes to the Senate.
Abolarinwa expressed hope that the board can help reverse the cocoa industry’s downward trend, saying, “With this board, these ministries must wake up to their responsibility and ensure that enough cocoa seedlings are raised throughout the entire cocoa-producing states.”
He urged improved funding for the Cocoa Research Institute of Nigeria, stating, “CRIN must be properly funded. If CRIN is not properly funded, our sector will not move forward. It’s always good that we say we want to move from 300,000 to 500,000 tonnes. But what does the government need to do?”
However, Abolarinwa noted that cocoa stakeholders recently met with the Federal Minister of Finance, Wale Edun, who he said sought to hear their problems and offered to help their businesses. “We have told them our problem. We will see how they are going to implement it,” he noted.
The CAN welcomed the NCMB initiative as a “major development” effort by the Federal Government, but maintained that it needs thorough implementation.
He explained that an earlier constituted National Cocoa Management Committee had drawn up a 10-year National Cocoa Development Plan, which he encouraged the NCMB to adopt upon Senate ratification.
Abolarinwa concluded, “The question of forming the board is not Nigeria’s problem; implementation is. There is nothing to rejoice about until we see the way they will organise the board’s activities to translate into a positive change in the life of the average cocoa farmer, processor and exporter in the country.
“Once they do it and the NCMB begins to have the desired effect, then Nigerian people will be happy.”
The PUNCH recently reported that the Cocoa Farmers Association of Nigeria, led by Adeola Adegoke, had called for the NCMB to adopt a strictly regulatory model that is not distracted by trade functions.
Adegoke said, “We want a board that will be for regulations, development, centralisation and protections but will not be involved in buying and selling. That is the kind of model that my leadership pushed for.”
Aligned with cocoa farmers, CAN, comprising cocoa value chain actors, including cocoa processors, urged the federal and subnational governments to step up their efforts to revamp the cocoa industry.
