Exports of cocoa products from Nigeria, the fourth-largest producer of the beans, rose 47 percent to $822.8 million in 2010, according to Olakunle Akingbola, business development manager of Cobalt International Services, an inspection company.
This represented about 35 percent of $2.32 billion earnings from non-oil exports last year for Nigeria, Africa’s leading oil producer, Akingbola said by phone today from Akure in western Nigeria.
“We expect to raise earnings from cocoa to 40 percent of non-oil revenue this year,” said Akingbola, whose company inspects all Nigerian non-oil products at ports before export.
Cocoa is Nigeria’s second-biggest foreign-exchange earner after crude oil, according to figures published by the Nigerian government. The Ivory Coast, Ghana and Indonesia produce more cocoa, according to the International Cocoa Organization.

http://www.bloomberg.com/news/2011-06-02/nigeria-s-cocoa-bean-exports-climbed-by-47-last-year-akingbola-says.html

Not bad. But I'd rather be exporting expensive chocolate than raw cocoa.

ekt_bear:

Not bad. But I'd rather be exporting expensive chocolate than raw cocoa.

True that! You might also want to take up the project also; will be good for Ekiti.

A good trend lets hope its continues

This is good, but we can do better. We are now number 5 behind Ivory Coast, Ghana, Indonesia and Cameroon. It will take some massive work for us to increase production.

Most of our experienced farmers a getting very old and their kids are not interested in the Cocoa Business. I saw a report on this the other day on NTA, it's very bad. I wonder if we can bring back the old Western Region Cocoa Board. It made many in our Grandfather's generation relatively wealthy.

Also, our farms are maintaining old tired trees on small-holder plantations, We might need to consolidate and help get these farmers access to better  techniques and improved finance. We can definitely do better, we have the population, the land and the right weather for some of the most sought after cocoa varieties. We should strive to out produce Ivory Coast, it will be tough though.

Even Anthony Ward is interested if we can get things right. His Hedge fund actually hoarded the largest single haul of cocoa in 14 years just last year!

But like ekt_bear said, We will not own this market or profit enough from it until we control more than just raw material export. We need to own the processing then the finished product market.

Akingbola said by phone today from Akure in western Nigeria.
“We expect to raise earnings from cocoa to 40 percent of non-oil revenue this year,” said Akingbola, whose company inspects all Nigerian non-oil products at ports before export.

I'm wondering why Cobalt Services is the sole export inspection service company authorized to inspect in Nigeria, is this sufficient for a country like Nigeria where we need to improve export to earn more revenue? don't know too much about that, just asking.

OAM4J:

True that! You might also want to take up the project also; will be good for Ekiti.

ekt_bear, let me know o, I want to do Business too.

ekt_bear:

Not bad. But I'd rather be exporting expensive chocolate than raw cocoa.

You are right, but I rather we do both. It's doesn't hurt to export the excess.


@Topic,

Good development, I however yearn for the good old days when we topped the chart! Better days are coming back.
Government should support the cocoa farmers with incentives such as improved seed, sprays, health insurance policy,
etc. Anything that will revive interest in the second-biggest foreign exchange earner in the country.

Nice one!

This was probably due to the crisis in the Ivory Coast.

The price of CoCoa rose sharply last year and so its easy to see why revenue from its export has increased.

I'm more interested in the volumes - How much did the volume of exports increase last year?

I can bet anybody the volume didn't increase by 47%.

Anyway, given the high price of cocoa presently, it should be a crop we increase production of 'sensibly'.

Flooding the market will bring down the price - therefore we need to produce in such quantities so as to 'maximise' profits to our producers.

emeka_gh:

You are right, but I rather we do both. It's doesn't hurt to export the excess.


@Topic,

Good development, I however yearn for the good old days when we topped the chart! Better days are coming back.
Government should support the cocoa farmers with incentives such as improved seed, sprays, health insurance policy,
etc. Anything that will revive interest in the second-biggest foreign exchange earner in the country.

Nice one!

good

The best news out of Nigeria so far, I hope to hear similar news about palm oil/kernel soon.

its cause of the shut down in exports in CIV and improvement of travel in Nigeria

Good news. Dem Ekiti boyz should keep it up.

Agricultural exports, processing plants etc. Our only way out of the unemployment quagmire

@ekt_bear: Exactly.  We need to stop relying on all these cheap commodities.  Let's export chocolates, beverages, etc and make much more.  Even in the oil sector we need to be exporting LNG, plastics, etc and  not crude oil.  You can't make much by exporting cheap unprocessed commodities.

This site is one of the best thin, that ever happened to Naija,diff people, wit di mindset, diff thoughts but just one Goal- success.
if we could have the likes of ekt bear and seun times 5 in govt (big offices) Nigeria will be better o than what it is now
if only those politicians can come here, for one hour, everyweek, and take sum advice on NLAND, this naija for don betta

As a long term project, I believe cocoa is it for the rain forest belt of Nigeria from Ondo to Akwa ibom. If we can increase the production volume, then maybe with some financial intelligence exports can come on the scene. The present set of elders we have in the south have lost intelligent ideas.

cocoa sales are not that rewarding for farmers from a return on investment perspective. most farms were planted in an era of cheap labour not that easy to get in this era of okada. farmers would be better of farming fish pigs chicken or even bushmeat

ekt_bear:

Not bad. But I'd rather be exporting expensive chocolate than raw cocoa.

Expensive like? Godiva et.al? I can see you saying exporting chocolate and other cocoa finished products but when u say expensive, there is really a small market out there for luxury chocolate as compared to mass production like Hershey and Mars (snickers my favorite) that's worth tens of billions of dollars. IMO, I rather chunk out "a good product of what the average person can buy" than what "the rich or more privileged can buy".


This is awesome development; at least there are hopes of improvement someday.

We already have a company that process raw cocoa to chocolate and beverages. Maybe many of you guys aren't aware of a company called Multi-Trex Integrated Foods plc.

This company is Capable of processing 50,000 tons of cocoa a year, it (together with its now dwarfed forebear peering beside it with a capacity for another 15,000 tons) becomes easily one of the largest, if not the largest cocoa-processing factory in Africa! And that is counting the big names in the industry in Nigeria.

The estimated asset worth of the Multi-trex complex is over N10 billion, most of it in state-of-the-art machinery bought through multi-layered financing arrangements initially begun with NEXIM (Nigeria’s export promotion bank) but spearheaded and hugely borne by Skye Bank, and supported by some foreign backers of the young entrepreneur, Mr. Dimeji Owofemi.

If you are guys are interested in knowing more about this company and the man behind this , you can google Multi-Trex Or Dimeji Owofemi.

^^
I saw the site, nice factory, BTW Do they export the "finished products" and to where?

I mean, like this company -->> http://www.barry-callebaut.com/  <<-- that company makes about $5 billion in sales from Cocoa products annually, that's a lot of money.

^^^^^


Seriously, I cannot believe that such company is wort about $70million equivalent; Nigerian companies need better web presence. While I'm amazed at their tremendous success, their website is nothing short of low and poor quality. However, starting up something like that is a giant leap which is really good, they just need to market themselves very well.

^^^^
Concerning the website; MY SENTIMENTS EXACTLY

Anyway, they are complaining about lack of funds, although they are listed on the NSE. It seems like a tough business to fund for investors in Africa, the big European players control the market.

I'm not sold on the N10Billion claim too.

For most of the company’s first two years of manufacturing life, inadequate funding prevented the company from storing up adequate raw cocoa beans, spare parts/consumables - a situation that compelled the company to enter into a working arrangement with one of its buyers. Under the arrangement, the buyer contracts to simultaneously sell cocoa beans to us and buy the relative products. It is expected that the company will gain greater control on its products when it is able to adequately fund its working capital requirements

Kilode?!:

^^
I saw the site, nice factory, BTW Do they export the "finished products" and to where?

I mean, like this company -->> http://www.barry-callebaut.com/  <<-- that company makes about $5 billion in sales from Cocoa products annually, that's a lot of money.

The finished products are for local market for now, but they have plans to export to foreign market in the near feature. The semi finished products like cocoa liquor, cocoa cake, cocoa butter and cocoa powder and the raw cocoa is being export to Europe mostly the UK and Italy.

Kilode?!:

^^^^
Concerning the website; MY SENTIMENTS EXACTLY

Anyway, they are complaining about lack of funds, although they are listed on the NSE. It seems like a tough business to fund for investors in Africa, the big European players control the market.

I'm not sold on the N10Billion claim too.

Isn't that why you write up a detailed and modeled business plan? Plan and evaluate your cash structure, perform market analysis, test your entry and exit strategies, guarantee funding including cash projections, financial forecast and projections et al? They are at an early / infant stage and they talking about money? Someone did not do their math correctly, quite unfortunate they are caught up in the mess; worse come to worse they have an exit strategies.

With regards to European players, goes back to my previous post; those ones are chunking out expensive chocolate, why not define your niche and perfect in it? If I managed that company, I will pick one product line (chocolate candies)and perfect in it rather than have different product lines yet your caught up. I will perfect and market that niche to Nigerian and other African nations, you would be surprised at how well it does. It's a gradual process before you catch up with the big guys, you can never start out with the BIG companies.

Take for instance, my tooth is really bad because I ate a lot of snickers while growing although I've stopped for health reasons not due to chocolate, but my point is snickers cost about $1:49 for the big bar and $0.89 for the smaller bar, Mars income alone from the sale of Snickers alone within the U.S. alone runs into hundreds of millions of dollars because people like me can't stop eating because it's cheap and tasty and nutty as well. In Nigeria were labor is cheap (about 4x cheaper, and the resources are even cheaper, )Nigeria has the two main raw materials ( Cocoa and Groundnuts ), you have everything covered, you will produce 5x more cheaper and even sell at a higher price if it's quality.

I don't know if anyone shares my opinion on this, but at least 10% of Nigerians population (kids up to 12years) are their major target market.

manny4life:



Isn't that why you write up a detailed and modeled business plan? Plan and evaluate your cash structure, perform market analysis, test your entry and exit strategies, guarantee funding including cash projections, financial forecast and projections et al? They are at an early / infant stage and they talking about money? Someone did not do their math correctly, quite unfortunate they are caught up in the mess; worse come to worse they have an exit strategies.

With regards to European players, goes back to my previous post; those ones are chunking out expensive chocolate, why not define your niche and perfect in it? If I managed that company, I will pick one product line (chocolate candies)and perfect in it rather than have different product lines yet your caught up. I will perfect and market that niche to Nigerian and other African nations, you would be surprised at how well it does. It's a gradual process before you catch up with the big guys, you can never start out with the BIG companies.

Take for instance, my tooth is really bad because I ate a lot of snickers while growing although I've stopped for health reasons not due to chocolate, but my point is snickers cost about $1:49 for the big bar and $0.89 for the smaller bar, Mars income alone from the sale of Snickers alone within the U.S. alone runs into hundreds of millions of dollars because people like me can't stop eating because it's cheap and tasty and nutty as well. In Nigeria were labor is cheap (about 4x cheaper, and the resources are even cheaper, )Nigeria has the two main raw materials ( Cocoa and Groundnuts ), you have everything covered, you will produce 5x more cheaper and even sell at a higher price if it's quality.

I don't know if anyone shares my opinion on this, but at least 10% of Nigerians population (kids up to 12years) are their major target market.

Manny4life, I think you should do a thorough research of the guy involve in this business, then you will know that he has done his maths correctly.

Go to the link and read just one of his interview concerning cocoa biz.

www.nigerianbestforum.com/index.php">http://webcache.googleusercontent.com/search?q=cache:d5MqVSRVfbAJ:www.nigerianbestforum.com/index.php%3Ftopic%3D94481.0%3Bwap2+dimeji+owofemi&cd=7&hl=en&ct=clnk&source=www.google.com

@manny you are right. I believe the right word is comparative advantage and the profit would be immense,but naija is so harsh to young businesses. (Imagine one really needs help from the government but they offer none,cos its not crude oil.)

Manny4life see he has done his maths well enough.

Multi-Trex Integrated Foods Plc (“Multi-Trex” or “The Company”) is a public limited liability company incorporated in Nigeria on 30th November 1999. Multi-Trex started business as a private cocoa merchant; buying cocoa beans from a select group of local suppliers for export to customers mainly in Europe.

In 2003, the company took advantage of the Nigerian government’s policies on non-oil export to expand its business operation by going into processing of cocoa beans into semi-finished industrial products i.e. Cocoa Liquor, Cocoa Butter, Cocoa Cake and Cocoa Powder.

To achieve its objectives, the company exclusively hired the production facility of Nigeria’s first cocoa processing plant for a period of two (2) years.Following the success of its manufacturing operation, the company resolved to build its own first cocoa processing factory with an annual capacity of 10,000 metric tonnes (MT). Working with top-rated technical experts and cocoa processing equipment manufacturers from Europe, the company’s factory was completed in 2005 and commissioned on February 1st, 2006 by the then President of Nigeria, Chief Olusegun Obasanjo, GCFR. The factory has since been upgraded to 15,000 MT annually.

The company also went on to construct an ultra-modern cocoa cake grinding plant, designed to pulverise 8,000 MT of Cocoa Cake into Cocoa Powder annually.The company completed a large-scale expansion project in late 2009, with the construction of a brand new 50,000 MT capacity factory with state-of-the-art cocoa processing equipment. In addition, the first cocoa plant is being further upgraded to increase its annual capacity to 30,000 MT before the end of the year. With an installed cocoa processing capacity of 80,000 MT, Multi-Trex is the most modern and biggest cocoa processing facility in Nigeria.

The company has successfully revolutionised the industry since entering the cocoa processing business and is committed to ensuring customers receive the best possible quality cocoa products. Multi-Trex prides itself in establishing a strict quality management system in line with leading Good Manufacturing Practices (GMP) and Hazard Analysis and Critical Control Point (HACCP) principles. At Multi-Trex, we believe that our people are our greatest source of competitive advantage.

We are therefore very particular about the quality of people we hire and the relevance of their work experience. Our organisation is made up of a good number of Nigerians with extensive experience in cocoa processing and trading.Our passion for excellence, strict adherence to high quality standards and membership of renowned cocoa associations (World Cocoa Foundation, Cocoa Producers Alliance, Cocoa Processors Association of Nigeria, etc.) have ensured continued patronage of our products in both local and International markets

FUTURE PLAN

The company plans to utilise cocoa powder output from its grinding plant to produce cocoa-based consumer products such as chocolate drinks, chocolate dry mix and chocolate bars. It is expected that the company’s manufacturing facilities to support the production of these new products will be on stream later this year.One of our goals is to be the champion of local consumption of cocoa-based fast- moving consumer goods (FMCG) in Nigeria.

As early as 1999, we established a sizeable cocoa plantation, which today serves as a crucial source of high quality seedling for supply to farmers to boost production. Furthermore, Multi-Trex has developed key initiatives geared towards further boosting production of high quality cocoa beans in Nigeria. These initiatives are being implemented in collaboration with relevant Government agencies and international organisations such as World Cocoa Foundation, USAID-MARKETS, Cocoa Research Institute of Nigeria, etc.

Expansion of existing markets is an integral part of the company’s future plans. Multi-Trex has successfully established a subsidiary in Zambia to facilitate sale of cocoa-based products in the South African region.

The government is not giving adequate attention to agriculture in the country. Where we are now is not where we should be. Agriculture must be taken as chief revenue earner, while oil should be the supplement.

Before oil was discovered, agricultural commodities were given prime of place, but when we discovered oil, government threw agriculture to the back door. Agriculture must be brought back, government must support agriculture production and we must change our present mindset of exporting cocoa beans to processing cocoa plants like Multi-Trex is doing.

What happens to our COAL  and Palm Oil? Why are different Goverment not doing anything  on these South Africa lives on COAL which we have in abundance,what is happening with our COAL

palm oil is quite different from coal. like cocoa plantations must be planted,they get old and must be renewed it is the kind of LONG TERM (how long does it take a palm tree to mature) venture that thrives on cheap exploited labour and ultimately benefits foreign multinationals.

how many posters will encourage their children to work on palm trees .with ever increasing food prices there are more lucrative/less demanding agricultural products and we can learn a lot from israel. if you live outside  naija look at the supermarket shelves and observe what people pay good money for and their countries of origin even ghana is not left out. definitely naija can export tomatoes  bananas and cooking herbs to name a few. we would probably need  to import new varieties but then cocoa  is not native to naija