Cocoa Farming Business is one of the top 10 most lucrative business in Nigeria. Cocoa is a crop Nigeria once banked on as its major exported cash crops before the oil boom.
Nigeria was the biggest exporter of cocoa in Africa and one of the biggest in the world. The Oil came and poor agricultural management set in, costing us badly and allowing us to lose the prestigious spot to a fellow African country – Cote d’Ivoire, who are now the largest cocoa producer in the world, followed by Indonesia.
When cocoa production and export is concerned, Nigeria only lives in past glory and if care is not taken, Nigeria might end up losing all it has gained from the export of what is touted as some farmers as the ‘Wealth Seed’.
For a long time, Cocoa has been and would for a really long (and I mean very long) time still be one of the fastest selling agricultural products in both the international market and the local market.
Although Cocoa is not the easiest of crops to manage, but once you can sacrifice the time and the effort to have it planted, groomed and nurtured to its full maturity, you can keep getting attractive returns on it for a time as long as decades.
However our aim in this content is to work you through the process of cocoa production and how you can start the business in Nigeria. Let get started:
Top 10 Cocoa Producing Countries in the World
In the past, Nigeria topped the list of cocoa producing countries. It lost its position as a result of the oil boom and exploration. In recent times however, it has taken up cocoa production again, and currently ranks as the world’s fourth principal cocoa producer.
According to the Cocoa Association of Nigeria (CAN), Nigeria ranks behind Cote D’Ivoire (1st), Ghana (2nd) and Indonesia (3rd).
Together, Ghana, Nigeria, and Cote D’Ivoire supply more than two -thirds of the world’s cocoa.
The top 10 cocoa producing countries in the world (as of today) are;
- Ivory Coast
- Dominica Republic
Top 9 Cocoa Producing States in Nigeria
The top cocoa producing states in Nigeria are;
- Ondo state
- Cross River state
- Ogun state
- Akwa Ibom state
- Edo state
- Ekiti state
- Delta state
- Osun state
- Oyo state.
Requirements For Cocoa Farming Business In Nigeria
To begin cocoa farming, the investor also needs to purchase a storage and drying space. Most cocoa farmers own warehouses to give the cocoa seeds the safekeeping needed, and this store needs to have enough space outdoors to spread and dry the seeds. The seeds need to be dried in the sun to be useable and the drying period usually takes two weeks.
Other relevant equipment needed are scales for weighing, heavy duty and normal-sized sack, and water proof material for drying the seeds in the open air.
Varieties and Types Of Cocoa
The three main varieties of cocoa plants are Forastero, Criollo, and Trinitario.
1. Criollo (The Rare Bean):
- The Criollo beans are the finest and rarest form of cocoa beans.
- They are not bitter and they have a rich taste.
- The Criollo pods are usually red or purple. The colour of the beans ranges from white to pale pink.
- The Criollo cocoa is mostly grown in Central & Southern America, the Caribbean islands & Sri Lanka.
2. The Forastero bean:
- They are commonly referred to as bulk cocoa. They are the most produced cocoa variety in the world, which makes up about 80 – 85% of the world’s total cocoa produce.
- They are naturally bitter and don’t have a rich taste.
- When freshly cut open, the colour of the beans is purple and that of the pod is yellow.
- They are produced in Ghana, Nigeria, Ivory Coast, New Guinea, Brazil, Malaysia & Indonesia.
3. The Trinitario Beans:
- They are hybrid cocoa produced from the cross-pollination of Criollo and Forastero beans.
- Trinitario beans have the robustness & high yield of Forastero beans along with the sublime taste of Criollo beans.
- They account for 10% – 13% of global cocoa production.
- The colour of Trinitario pods varies in shape & colour as it is a hybrid. The beans are white to creamy in colour.
- Trinitario has the strength of a Forastero bean to fight against diseases and the taste of a Criollo bean.
- They are also found in the Caribbean islands, Venezuela and Colombia and also in some parts of South-East Asia.
What Is The Best Climate Conditions For Cocoa Farming in Nigeria
Cocoa farming can only be done under very specific climatic conditions which include 21-32oC temperature and 100-250 cm of rainfall, well distributed throughout the year.
Cocoa trees do not like too much sun, and its natural habitat is under the heavy rain forest canopy. That’s the reason why you rarely find a cocoa farm in the northern part of Nigeria.
Cocoa would only thrive in states like Ondo, Ogun, Rivers, Cross River, Osun, Oyo, Ekiti, Imo, the western, Eastern and Southern states of Nigeria where there is abundant rain and less sun.
In addition, Cocoa should be planted under the shade of crops such as oil palm, rubber, banana, mango, orange and coconut trees. This will ensure that the direct heat of the sun is not borne by the cocoa pods.
To begin cocoa farming, the investor needs to purchase storage and drying space. Most cocoa farmers own warehouses to give the cocoa seeds the safekeeping needed, and this store needs to have enough space outdoors to spread and dry the seeds.
Benefits Of Starting Cocoa Farming Business In Nigeria
Cocoa farming in Nigeria now presents one of the best investment opportunities to local investors in agribusiness, as cocoa remains one of the fastest selling agricultural products in the international market.
The turnover (profit) on cocoa cannot be compared with other agriculture business like vegetable farming.
Nigeria has more land for cocoa (probably) than for rice farming since the international demand for cocoa produce is high, it makes simple business sense to get into a business where demand greatly surpasses supply, as it means that every product cultivated has a ready market.
- Cocoa is an essential ingredient for chocolates
- 70% of the world’s cocoa beans come from four West African countries: Ivory Coast, Ghana, Nigeria, and Cameroon
- Ivory Coast and Ghana are by far the two largest producers of cocoa
- Worldwide, 90% of cocoa is grown on small family farms of 2 to 5 hectares, while just 5% comes from large plantations of 40 hectares or more.
- Cocoa production provides a means of livelihood for between 40 and 50 million farmers, rural workers and their families in major cocoa-producing nations
- Cocoa trees need to be planted next to tall trees in order to protect them from direct sunlight. This is why cocoa trees are planted amongst mango and papaya trees.
- It takes 3 to 5 years before the cocoa trees bear fruit. Each Tree produces around 1,000 beans a year.
- Every stage of cocoa production is done by hand: planting, irrigating, harvesting, fermenting and drying
- The first chocolate bar was made in 1848
- Cocoa helps normalize blood pressure
- Cocoa helps to improve brain health and brain capability
- Cocoa helps improve cardiovascular health
- Cocoa helps regulate blood sugar
- Cocoa butter helps skin healing and moisturizing.
- Cocoa farming is a great source of employment
- You can earn anywhere from 20% to sometimes over 100% profit margins, trading rubber locally and internationally
Market Value and Business Opportunities In Cocoa Farming
1. Animal feed production
As pelletized dry 100% cocoa pod husk, it can be used as an animal feed. The animal feed is produced by first slicing the fresh cocoa husks into small flakes and then partially drying the flakes, followed by mincing and pelleting and drying of the pellets.
The dried cocoa pod husk is used as an animal feed in Nigeria, Africa, and many other parts of the world.
2. Production of soft drinks and alcohol
In the preparation of soft drinks, fresh cocoa pulp juice (sweetings) is collected, sterilized and bottled.
For the production of alcoholic drinks, such as brandy, the fresh juice is boiled, cooled and fermented with yeast. After 4 days of fermentation the alcohol is distilled.
Fresh cocoa pulp juice is used in the production of chocolate drinks. This fresh pulp juice can be fermented and used to produce alcoholic beverages.
3. Potash from cocoa pod husk
Cocoa pod husk ash is used mainly for soft soap manufacture. It may also be used as fertilizer for cocoa, vegetables, and food crops.
To prepare the ash, fresh husks are spread out in the open to dry for one to two weeks. The dried husks are then incinerated in an ashing kiln.
4. Production Of Cocoa Butter:
Cocoa butter is used in the manufacture of chocolate. It is also widely used in cosmetic products such as moisturizing creams and soaps.
5. Production Of Cocoa Powder:
Cocoa powder is used in many food recipes such as; chocolate flavoured drinks, chocolate flavoured desserts, chocolate spreads and sauces, and cakes and biscuits.
How To Start Cocoa Farming Business In Nigeria:
1. Secure a Good Farmland:
Cocoa needs soil rich in nutrients, to a depth of 1.5m to allow the development of a good root system. The cocoa tree doesn’t grow well in waterlogged land and is sensitive to a lack of water, so the soil must have both water retention properties and good drainage.
This is a cost that will vary widely around the world and within a country. The land must be chosen so as to provide the best soil and climate for the cocoa trees.
2. Administer the plantation
The costs involved here includes clearing the land, planting shade and cocoa trees, pruning, weeding, fertilizer and pesticide applications and constructing the required infrastructure such as roads, irrigation ditches, nursery and processing facilities.
3. Choose Suitable Cocoa Varieties:
From the various varieties of cocoa plants, choose the most suitable seeds that you have a ready market for, you have the right conditions for cultivation, and would give you a reasonable yield.
4. Maintaining the plantation:
The costs involves pruning, weeding, fertilizer and pesticide applications, harvesting and post-harvest processing.
5. Use Cocoa Breeding
There are different breeding method but the basic methods of cocoa breeding are;
- Seeding: Here, the cocoa tree is raised primarily from seeds. Beans are taken from pods within 15 days of harvest and are planted, adhering to the soil and climatic conditions required. Such seeds will usually germinate and produce good plants.
- Cutting – Tree cuttings are taken between two and five leaves and one or two buds. The leaves are cut in half and cutting placed in a pot under polyethene until roots begin to grow.
- Budding – A bud is cut from a tree and placed under a flap of bark on another tree. The budding patch is then bound with raffia and waxed tape of clear plastic to prevent moisture loss. When the bud is growing, the old tree above it is cut off.
- Marcotting – A strip of bark is removed from a branch and the area covered in sawdust and a polyethene sheet. The area will produce roots and the branch can then be chopped off and planted.
How To Harvest Cocoa During Maturity Period:
Most countries have two periods of peak production per year: A main harvest, and a smaller harvest.
Cocoa farmers use long-handled steel tools to reach the pods and cut them without wounding the soft bark of the tree. Farmers collect the pods in baskets.
Post-harvest processing has the biggest impact on cocoa quality and, consequently, on cocoa taste, which includes:
Fermentation and drying.
Farmer removes the beans from the pods, packs them into boxes or heaps them into piles, then covers them with mats or banana leaves for three to seven days.
The layer of pulp that naturally surrounds the beans heats up and ferments the beans, which enhances the cocoa flavor. The beans are then dried in the sun for several days.
Pods containing cocoa beans grow from the trunk and branches of the cocoa tree. Harvesting involves removing ripe pods from the trees and opening them to extract the wet beans.
Pods are suitable for harvest for 3 to 4 weeks, after which time the beans begin to germinate. It is, therefore, necessary to harvest at regular intervals as the pods do not all ripen at the same time. The frequency of harvesting can have an effect on yield.
During harvesting, it is important to not damage the flower cushion which will produce the flowers and fruits of subsequent harvests, and care must be taken not to damage the tree, which would make it easy for parasitic fungi to penetrate the tissues of the tree.
Challenges Facing Cocoa Farming Business in Nigeria
The Challenges facing the country’s 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 loses $1 billion per year.
The Minister of Agriculture has attributed this to negligence on the part of Government over the past 30 years. According to the Minister, actual records 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% 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. This challenges facing the Osun state farmers have affected productivity and as a result, has led to a decrease in Cocoa production.
Solution To The Challenges Facing Cocoa Farming Business in Nigeria
In order for Nigeria to increase the Cocoa production and export per year, the government needs to support the farmers. The government should offer support in form of subsidies, aids, loan and funds.
Government should also introduce economic policies that are favourable to the farmers. A bad economic policy will hinder the production levels of the farmers which will also lead to decrease in output.
If Nigeria is to climb up the rank, then government must act fast.
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