Is Nigeria’s coffee industry going into extinction?

Nigeria currently grows coffee in some parts of the north. But over the years, coffee has seen a significant dip in both production and export.

In fact, Nigeria produced 2,100 tons of unroasted coffee in 2013, a figure which is insignificant by global standards.

The country recorded no export between January and July 2015 when Ethiopia, an African country with fewer than 100 million people, produced 174,000 tons of coffee, earning $1 billion from its export.

There have been fluctuations in global demand and prices in the last five years, but coffee demand is on the rise. However, no farmer in Nigeria seems to be tapping the potential.

World coffee exports were 9.13 million bags in October 2016, compared with 9.31 million bags in October 2015, according to the International Coffee Organisation.

In the 12 months ending October 2016, exports of Arabica (a specie) totalled 71.93 million bags, compared to 69.21 million bags last year.

In the 12 months ending October 2016, Robusta (a specie) exports amounted to 40.46 million bags, compared to 43.81 million bags last year.

Nigeria’s coffee consumption is expected to grow by 23 percent within the next three years, as an expanding middle-class spurs demand.

Euromonitor International in 2016 predicted that Nigerians would drink more than 1,000 tons of coffee in 2020, which is higher than previous projection.

Globally, coffee is the most sought-after product besides oil.

Multinationals in Nigeria are however filling the gap to some extent, but production is not happening on the farmers’ side, meaning that raw materials for coffee produced by multinationals are imported.

Euromonitor International said in 2016 that Nestlé Nigeria Plc dominates coffee in Nigeria in both retail volume and retail value terms , with its Nescafé brand controlling a 76 percent retail value share in 2015. Nestlé SA brands, imported by third parties other than Nestlé Nigeria Plc, make up another eight percent off-trade value share of coffee.

A rising middle-class population estimated at about 30 percent is among the main drivers of coffee consumption.

“Consumption of coffee has been on the rise in recent years because of our growing middle-class and young population, but there is still no market for coffee in Nigeria because the country’s coffee is of low quality and that is why the local industries using it as raw materials are not buying from farmers,” Hassan Usman, secretary-general, National Coffee and Tea Association of Nigeria and a coffee farmer at Mambila Plateau in Taraba State, told BusinessDay in a telephone interview.

“Our method of harvesting coffee is very poor. Farmers need a lot of training on good farming practices. There is no value chain for coffee and tea production in the country and majority of our coffee trees are old,” Usman said.

Nigerian farmers, however, believe that coffee is gradually going into extinction, attributing it to lack of government support and investment in the sub-sector.

“Coffee has always been a neglected industry in Nigeria. There has not been support from the government in terms of funding, provision of fertilizers and land acquisition, which farmers in other countries enjoy” Ibrahim Sadiq, chairman, National Coffee and Tea Association of Nigeria (NACOFTAN), told BusinessDay in a telephone interview.

“Price was down some years ago, so farmers felt there was no need planting it. What we need is government attention,” Sadiq said.

Brazil, with about Nigeria’s population (200 million people) earned $5.6 billion in 2016 while Colombia and Vietnam made $2.6 billion and $2.4 billion respectively the same year.

Kenya’s coffee earnings rose 17 percent to $254.2 million during the 2013/14 crop season due to improved production and higher prices.

Farmers in Kenya benefited from subsidised fertiliser from the government during the period, helping them to raise production by a quarter to 49, 475 metric tons, according to government records. More than 150,000 farmers are involved in coffee production in Kenya.

Vietnam earned $2.4 billion in 2015 on coffee export, creating jobs for more than 1 million workers. Colombia is the second-largest supplier of Arabica coffee after Brazil, earning $2.2 billion from annual export in 2015.

A Taraba coffee farmer Usman Ganduje told BusinessDay that Nigeria needs to improve coffee its seedlings and farm practices, stating that the local industry is already going the way of textiles.

“Others from Vietnam and even Kenya are enjoying because they have incentives,” Ganduje said.

Hussaini Doko Ibrahim, director-general of the Raw Materials Research and Development Council (RMRDC), said in July 2016 that Nigeria recorded zero percentage in coffee production for the first four months of 2015 despite the fact that coffee consumption by Nigerians has continued to increase.

On tea, he said the country has enormous potentials for tea production, especially in the Mambilla Plateau, but the total tea production in Nigeria is not important in the global market.

Ibrahim said the country’s production meets only 25 percent requirement of local tea packers.

 

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