BMI View: We take a mixed view of the Nigerian agribusiness sector . The cocoa industry assumes a greater importance in the country's medium - term economic future now that oil revenues can no longer be relied upon as an easy source of foreign exchange . We remain cautiously optimistic that cocoa plantations and processing facilities will continue to receive the public and private sector support needed to move forward . Poultry, dairy, sugar , rice and wheat consumption are expected to continue to depend very largely on imports to meet demand , although a much greater percentage of demand for each of these commoditie s (apart from wheat) could potentially be met by local production. Poor infrastructure, fragmentation and a lack of access to finance and expertise are among the factors that lead us to take a pessimistic view of the medium - term prospects for self-sufficiency.
|Agribusiness Market Value|
|BMI Market Value By Commodity (2011-2019)|
|e/f = BMI estimate/forecast. Source: FAO, BMI|
Cocoa production growth to 2018/19: 53.9% to 381,600 tonnes. Global prices will remain sufficiently elevated to stimulate investment from government and private sector bodies.
Corn consumption growth to 2019: 1.5% to 7.9mn tonnes. Weaker demand from the livestock industry will hold down consumption growth.
BMI universe agribusiness market value: increase of 2.2 % to USD96.4 bn in 2015; forecast to grow by 35.3% from 2014-2019.
Real GDP growth in 2015: 3.9% (down from 6.3% in 2014).
Consumer price index in 2015: 10.0% ave (up from 8.1% in 2014).
Parts of Nigeria are suffering from the effects of a drought that may hamper the mid-crop cocoa harvest. In May, Bloomberg reported that beans harvested in Ekiti State in the west of the country were underweight or malformed, making them unfit for export. Meanwhile, Reuters reported in June that pods in the key cocoa-growing region Ondo State had been damaged by the dry weather. There has since been some rainfall in the region and we will continue to assess the situation in the lead up to the 2015/16 main crop harvest beginning in September.
Two Chinese firms have stepped in promising investment to turn around the struggling Cocoa Processing Company in Ede, Osun State. Local media sources reported that Skyron Corporation and Golden Monkey Group met with State Governer Rauf Aregbesola in June to confirm the takeover. The investors have committed to commencing production at the cocoa processing factory within the next six months. Both companies already have substantial investments in the region. Golden Monkey is reportedly the largest confectionary manufacturer in China and has stated its intention to set up a company to retail its products in the Nigerian market.
Nigerian smallholder farmers in the most arid regions of the country could benefit from the launch of a new fund. The Global Environment Facility is providing USD106.5mn of funding for its project to improve the sustainability of small-scale agriculture in 11 sub-Saharan African countries with a further USD805mn of finance coming from foreign governments, non-governmental organisations and international agencies.