Nigeria’s cocoa industry is transforming, significantly impacting economic diversification. With prices soaring and investments flowing in, cocoa could generate new revenue streams and reclaim Nigeria’s global cocoa market position. Key developments include record-high prices driven by global demand, significant investments, and increased exports, emphasizing agriculture’s role in reducing reliance on oil revenues.
Nigeria’s cocoa industry is rapidly transitioning into a significant contributor to economic diversification. With increasing global demand and investment, the sector presents opportunities to generate new revenues and restore Nigeria’s status in the international cocoa market. With unprecedented price rises and expanding exports, Nigeria is poised to capitalize on its cocoa resources as it seeks to reduce reliance on oil revenues.
In December 2024, cocoa prices in Nigeria escalated by over 700% compared to January 2023, reaching ₦15 million (approximately $10,000) per tonne due to global supply constraints, heightened demands from Asian and European markets, and currency fluctuations, as reported by the Cocoa Research Institute of Nigeria (CRIN). This development not only enhances the cocoa sector but may also spur demand for other agricultural products, reviving Nigeria’s agricultural heritage that had been overshadowed by oil.
Oluwatobi Falegan, a finance expert, emphasizes that the advancements in the cocoa industry are indicative of broader economic potential. He stated that “Agriculture, as a cornerstone of Nigeria’s diversification efforts, stands to gain from global demand. Cocoa’s success sets an example for other commodities, such as cashews, sesame seeds, and ginger.”
Recently, the British International Investment (BII) announced a partnership with the Johnvents Group, committing US$40.5 million to enhance production efficiency and foster sustainability in cocoa farming. BII’s coverage director, Benson Adenuga, stated, “Not only will this benefit local farmers, but it will also improve Nigeria’s trade balance and global competitiveness through increased exports.”
Cocoa remains one of Nigeria’s top non-oil exports, primarily cultivated by over 300,000 smallholder farmers in the southern region. Statistics from the World Atlas position Nigeria as the seventh-largest cocoa producer globally, yielding about 270,000 metric tons annually, behind leading countries such as Côte d’Ivoire and Ghana, which produce millions of tons.
Nigeria, like many African countries, primarily exports raw cocoa, which diminishes its potential gains from the lucrative global chocolate market valued at $130 billion. The International Cocoa Council notes that Africa only captures a small fraction of this market, raising concerns over missed economic opportunities that could arise from investing in processing facilities.
Despite the challenges, export growth from Nigeria is accelerating due to disruptions in cacao-producing nations like Côte d’Ivoire and Ghana, enhancing its appeal as a cocoa source. The latest National Bureau of Statistics data reveals cocoa constituted 7.12% of all agricultural exports in 2025, highlighting its increasing significance in the economy.
In the fourth quarter of 2024, the oil sector’s contribution to Nigeria’s GDP fell below 5%, whereas non-oil sectors, particularly agriculture, experienced growth, contributing 25.59%. Dominic Joshua, founder of Cultivate Africa, noted, “If the trend continues, cocoa can generate more revenue than oil in the next decade… But the time to act is now.”
Falegan indicates that cocoa’s success in meeting EU compliance standards could stimulate government support for other crops, improving agricultural practices and post-harvest management. He advocates for the adoption of sustainable methods to align Nigerian agriculture with global market standards, ensuring future success and profitability.
In summary, Nigeria’s cocoa industry presents a valuable opportunity for economic diversification, characterized by soaring prices and investment. As demand grows, cocoa could redefine Nigeria’s agricultural landscape, prompting the government to support sustainability and quality standards. With potential to surpass oil revenues in the future, now is the crucial time for stakeholders to invest in this emerging sector.
Original Source: www.independent.co.ug
