Presently, Nigeria’s cocoa farmers are experiencing a boon as a result of the soaring prices of cocoa beans in the international markets. This is particularly notable given Nigeria’s transition to a deregulated cocoa economy following the abolition of the cocoa board in 1986.
In contrast, cocoa farmers in Ghana and Ivory Coast are not enjoying a similar advantage due to the structural limitations of their cocoa economies. These limitations restrict their ability to capitalize on the current surge in cocoa prices, primarily due to the execution of future cocoa contracts by their respective cocoa boards.
It has come to our attention that the prices paid to cocoa farmers in these two leading cocoa-producing countries have remained stagnant since April 2023, hovering around $2,700 per ton. Despite recent reports of significant price increases in both Ivory Coast and Ghana, with increments of 50% implemented just last week and this week respectively, Nigeria’s cocoa farmers remain relatively unaffected by such constraints.
What Nigeria urgently requires is to fortify the governance of our cocoa economy, aiming to amplify both the production and productivity of smallholder cocoa farmers’ holdings. This can be achieved through the facilitation of subsidized farm inputs, provision of credit facilities, and capacity building initiatives, thereby enhancing their livelihoods.
Initiating the regulation and advancement of the Nigerian cocoa economy through the National Cocoa Management Committee (NCMC) is imperative. Increased investments in the sector can be assured if the Committee succeeds in establishing a stable regulatory framework that oversees quality control, addresses issues of smuggling and pesticide management, enhances extension services, conducts research and development, ensures traceability, fosters collaboration between the Federal Ministry of Agriculture and Rural Development (FMARD), State Cocoa Producing Governments, combats child labor, controls deforestation, and implements the National Cocoa Plan.
The NCMC should refrain from engaging in the buying and selling of cocoa beans, except in cases where cocoa bean stabilization support funding becomes necessary, particularly during periods of significant downturn in cocoa prices beyond the economic capacity of cocoa farmers. This approach aligns with practices observed in other developed countries regarding the stabilization of commodities.
The European Union Deforestation Regulations (EUDR) policy advocates for enhanced collaboration among cocoa stakeholders to establish a national traceability system, ensuring transparent and sustainable practices in Nigeria’s cocoa industry.
Considering the decline in cocoa production in Ivory Coast and Ghana due to various factors such as pest and disease outbreaks, climate change, smuggling, mining activities, and land degradation, Nigeria stands poised with better opportunities for advancement.
With Nigeria’s youthful population actively engaged in the cocoa industry and favorable governance facilitating recent benefits from cocoa price increases for Nigerian cocoa farmers, the future of Nigeria’s cocoa sector appears promising. The effective exercise of regulatory powers vested in the National Cocoa Management Committee (NCMC), led by private stakeholders in the Nigerian cocoa industry, will further enhance this trajectory.
Nigeria is making strides towards a sustainable cocoa economy, bolstered by the renewed agenda of the current administration.
Comrade Adeola Adegoke serves as the National President of the Cocoa Farmers Association of Nigeria (CFAN), providing leadership and insights into the cocoa industry’s development in Nigeria.
