Monday 28 November 2016

Investment Opportunities in Garlic



Garlic is second most widely used amongst cultivated Alliums after onion. Its pungent smell could be very unpleasant when perceived fresh but when added to meals gives the meal a delightful fragrance.
Garlic is widely recognized today as a health enhancing supplement.


SOURCING
 
Garlic is grown commercially in FADAMA regions which includes Northern states like Kano, Kaduna, Kebbi, Sokoto, Jigawa, Bauchi, Katsina and Zamfara States. Its production is mainly around the savannah ecological zone where all factors of production are favourable.


PRODUCTION STATISTICS
 
The national production figure for garlic is 150, 000 metric tonnes. Sokoto State produces the highest quantity.


PLANTING SEASON
 
Garlic is planted under irrigation during dry season between the months of November to March


USES
 
Garlic is a common flavoring used in cooking. It serves as a food additive which prevents food poisoning.

It is used as a raw material in pharmaceutical industries. It is also used to produce supplements which have enteric coatings.


PRICING
 
The local price of garlic ranges from about N170,000 to N210,000/MT, depending on the location of purchase and the period during its season.


EXPORT MARKET
 
The United States is the world’s largest import market for fresh garlic, followed closely by Indonesia, France, Germany, Australia and Brazil.


HARVESTING
 
Garlic bulbs are harvested at optimum maturity period when the plants are eighteen (18) weeks old that is, four to five weeks after planting.


STORAGE
 
Garlic bulbs are stored individually with the tops removed. The bulbs are stored in an uncovered or loosely covered container in a cool, dry, dark place. The flavor will increase as the bulbs are dried.
Garlic can be stored in jute sacks, preferably in a mud house with thatched roof.


PROCESSING
 
The processing operations of Garlic particularly includes; Garlic grading, bulb breaking, clove separation, size reduction, peeling, clove flaking, dehydration, blending, packaging, storage, grinding etc.

It’s processing requires special skill and care, because it’s essential volatile oil is concentrated in epidermal cell, which is mainly responsible for its characteristic aroma.

The following products may be prepared from the processing of Garlic:
a. Garlic Flex
b. Garlic Powder
c. Garlic Tablet
d. Garlic Paste
e. Garlic Pickles
f. Garlic cloves
g. Garlic Digestive Churn etc.


MARKETING
 
The market for the Nigerian garlic is widely spread and is the bulk of households, restaurants, eateries, caterers, and clubs use it regularly. The demand for the processed products is increasing day by day due to its convenience to handle and use. There are good export prospects as well.


INVESTMENT SUMMARY
Production
Processing
Export
Storage
Marketing

Xmas: A Case For Nigerians To Buy Local Rice



Nigeria is the Africa’s leading consumer of rice and one of the largest rice importers in the world. Statistics had shown that Nigeria imports about 3 million metric tons of rice annually.

But, since the government restricted importation of rice from the border point to seaports, smuggling of rice into the country has increased astronomically with an estimated 1 million metric tons (20 million 50KG Bags of rice) suspected to enter the country illegally through its porous borders on an annual basis.

According to statistics, the three million metric tons of rice consumed yearly amounted to about 60 million 50kg bags of rice that are legally imported while over 800 million metric tons are smuggled into the country.

Nigeria spent N630 billion, or about $3.8 billion, to import agricultural products in 2012. In 2011, Nigeria was the world’s second biggest importer of rice, bringing in about 2.5 million tons of rice.

But, early 2013, in an effort to regain food self-sufficiency, the government increased the tax on imported rice from 50 to 110 percent, a 60 percent hike. The tax was meant to encourage locally produced and processed rice and wean the country off imported rice but it rather encouraged smuggling and loss of revenue to government as major rice exporters from South and Southeast Asia in other to evade huge tax began diverting shipments to Nigeria’s neighbouring countries—namely Benin Republic to the west and Cameroon to the east—whose governments suddenly began earning millions of dollars in duties.

Since it was practically nearly impossible for domestic rice producers to build the level of capacity required to mill and process enough rice in time to have a significant effect on the market, smuggling especially of rice that has passed its shelf life become order of the day for rice importers and vendors in the country.


Shelf life of polished Rice

Smuggled white rice isn’t believed to be good for consumption because it has a storage life of 8-10 years at a stable temperature of 70 degrees Fahrenheit. Sadly enough, most of the smuggled rice has used over 10 years in the silos of the developed countries before being shipped into Nigeria for consumption.


Customs raised the alarm on influx of Expired rice into Nigeria

The Comptroller-General of Customs, Col. Hameed Ali (rtd), recently said 99 per cent of rice smuggled through the land borders are not fit for human consumption.
He said samples of some of the rice seizures made over a period were referred to NAFDAC to ascertain their condition but were certified that rice smuggled through the borders was unfit for human consumption.

Corroborating the Customs CG, the Customs Area Controller, Oyo/Oshun Command, Comptroller Tope Ogunkua warned that expired rice flood Nigeria markets.

He said the consuming public should be vigilant when they want to purchase rice in the market to ensure that they do not consume expired rice.

According to Ogunkua, the command has continued to discover so many bags of expired rice out of the many lorry loads of the commodity which it has impounded saying that it was an indication that the smugglers have continued in their attempts to bring expired rice into Nigeria.

He said “despite the policy banning importation of rice through the border, people still bring in the rice through the borders. In fact the number of importers trying to do so has increased now and that is why we have so many lorry loads of rice in our compound while there are still some in the Barracks. We are also battling them very well and that is why we are able to make all these seizures”.

He explained that consumers need to continue to be extremely careful when they go to buy rice especially as we move into the festivity period; they must ensure they inspect the rice they want to purchase very well, whether they want to buy in bags or out of the ones that have been poured into the basins to be retailed.


Why Customs placed ban on polished rice through the land borders

The Customs had said it played ban on rice through the land borders in order to exercise control over what Nigeria consumed.

According to a former Comptroller, Federal Operations Unit, FOU A of the Nigeria Customs Service, Mohammed Dahiru, rice was banned through the land borders by the Federal government in other to control what should be brought into the country.

He said the FOU A has done enough to curb smuggling if rice through the land border.

“I believe we have been able to achieve greater percentage of suppressing smuggling and if somebody is to be objective and be fair to customs FOU A, I believe it will be a pass mark because what is in the FOU A warehouse both open and other warehouse is good testimony that FOU is working. It is full to the brim for rice.


Ingenious ways polished rice is smuggled into Nigeria

Smugglers of rice are said to have device ingenious way of carrying out their illegal activities as according to a source, the smugglers often package the rice in a disguise form to make it look like other goods that were not outlawed.
“We have seen rice conveyed in open wooden canoes across our creeks and water ways with generous amount of dirty waters splashing on them. We have seen some mixed with other grains bags to deceive customs; some are stuffed inside any available crevice and compartments of vehicles, including the engine area.
“The concealed rice is thereafter re-bagged half cooked and presented in our markets for sale as imported rice. Bags of rice meant for Nigerians’ consumption is being conveyed in coffins inside make shift ambulance vehicles. Often time, importers in the borders have to wait for months for the green light from corrupt customs officials before they gamble their ways across the borders.
“Rice being a perishable product, lose valuable shelve life in non-conductive strong conditions. We have strong evidence linking some reputable importers to cases of re-bagging expired rice to prolong their shelve life,’’ he added


How to identify expired polished rice

Since rice has an indefinite shelf life if kept dry, it is hard to tell if it has gone bad. One thing to watch for is the presence of the rice weevil, a tiny reddish-brown bug. If you see these moving in your product, you should discard the entire container and disinfect the container and the surrounding shelves.

Expired brown rice, on the other hand, is easier to spot. Brown rice may become oily and give off a rancid odour because of its essential fatty acids that go bad as they oxidize.

According to www.oureverdaylife.com, an online site, rice may be described as expired if the bran oil has started to go rancid, the smell will be obvious – dank and musty, with a nose-crinkling sharpness. There are also visible signs of deterioration. The rice grains may look discoloured and oily. The grains may even start to stick together in clumps. Depending on the degree of moisture the rice has been exposed to, there may be visible mould.

But, a rice vendor at Sango Market, Chukwudi Nonso said the easiest way to identify expired rice is by firstly rubbing in between palms. He said if it successfully turns into dust then the cereal has expired.

He also noted that another way to identify a rice that has passed it’s shelve life is when it refused to sink when poured into water he said instead of the rise to sink inside the water, a substantial amount would be seen floating on the water.” Nonso said.


Implications of eating expired polished rice

Though some expiry dates relate to product taste, in some cases eating expired rice triggers food poisoning. Symptoms and health effects vary depending on the type of poisoning.

However, common signs include cramping in the stomach area, frequent vomiting, fever, dizziness, dehydration and persistent diarrhoea. The symptoms may last a few hours, days or weeks depending on the severity of the condition. Rice stored past its use-by date in poor conditions can even become contaminated with the serious bacterial infections salmonella or listeria.

One obvious sign of rice well past its expiry date is the growth of mould. Mold includes several types of fungi. Their spores land on the food from the air and start to grow. Some moulds produce toxic substances as they develop. Mycotoxins can cause itchiness, nausea, dizziness and sometimes headaches.


Why Nigerians should patronize Local rice against polished rice

Now that an alarm over safety of foreign rice has been raised, it is high time Nigerians embraced local rice especially because of its health benefits.

It was established that reason many people prefer the polished rice to the locally-made unpolished rice in Nigeria is the stress they go through in picking the latter before cooking it, compared to the polished rice which is very clean and ready for boiling and also can be cooked in less than 20 minutes compared to the unpolished rice.

But then, local rice is self-preserving and one of the foods that add value to the lives of health conscious people including those who are diabetics.

According to an expert, Osaretin Albert, both the white and brown rice contain similar amounts of energy, carbohydrates and protein. Local rice however contains higher amounts of vitamins and minerals; the cellulose of local rice not only increases the fibre content but also contains a variety of colour pigments that is beneficial for health.

Local rice variety contains higher proteins at raw cooked and soaked states as compared to imported rice. It was also found that local rice contains rough surface and more phosphorous and fibre which help in the reduction of the risk of bowel disorder, fight constipation among others.


Smuggled rice are substandard – NAFDAC

The National Agency for Food Drug Administration and Control (NAFDAC) warned that rice smuggled into through the land borders are substandard.

The Acting Director-General, NAFDAC, Yetunde Oni said that records showed that rice imported through the seaports were registered as good quality as pronounced by satisfactory reports from NAFDAC laboratories while those smuggled through the land borders were unregistered and largely substandard.

She said, “NAFDAC is poised to joining hands with Customs to increase surveillance and monitoring activities at all border posts to curb the menace of rice smuggling through the land borders.“

Agro Commodities To Invest In This Dry Season

  1. GINGER
The Nigerian ginger is highly sought for. The demand for ginger in Nigeria outweighs its production. It is a seasonal Agro commodity that has a wide range of domestic and commercial value and uses.
You can trade your ginger locally and it is also highly sought for in the international market, hence its export value. Most importantly you can go ahead to add value in the raw ginger by processing into other ginger products. Ginger is found in abundance in Kaduna State.

2. SOY BEANS.

Nigeria’s current demand for Soybean outweighs its current production.
It is highly sought for in the animal feed industry and also of high demand in the local market for its high nutritional benefit and domestic use. Soybean is also abundant in Kaduna and other parts of Northern Nigeria.

3. GARLIC.

Garlic is a sure money spinner with huge opportunities for the local and international (export) market.

4. RAW CASHEW NUTS.

Raw Cashew Nuts (RCN) is a money spinner. You can invest in Raw Cashew nuts for either local trade or export depending on your capital. Also Raw Cashew Nuts can be processed into the highly sought for Cashew kernels with high domestic and international demand.

5. PALM OIL

With the high demand of the commodity in Nigeria Palm Oil is a sure money spinner for any agro commodities investor. Potential investors should enter the palm oil business during the dry season, when prices are relatively cheaper and supply abundant.

6. Palm Kernel

 Palm Kernel is a by product of the Oil Palm, specifically the palm fruit. It is highly sought after commodity due to its widely used Palm Kernel Oil (PKO), which is in high demand by industries and manufacturing sector

7. Palm Kernel Oil (PKO)

I call it “the new oil”. It is gotten from the Palm Kernel. Also a money spinner for knowledgeable and well informed investors and start ups.
Others include cocoa seeds, sesame seed, and hibiscus(Zobo) leaves etc.

Dangote Sugar Intensifies Effort In Ensuring Self-sufficiency



Efforts are being made by Dangote Sugar Refinery (DSR) Plc to ensure self-sufficiency in sugar production in the country within the next four years.

Over the last year, Dangote Sugar has stepped up its opening of processing factories and assistance to farmers in a bid to dramatically increase output.

Nigeria is one of the world’s largest net importers of sugar, consuming significant amount of foreign exchange. Between 1955, Nigeria consumption rose from 43,000 tones to about 45,000 tones in 1974; by 1982 it rose to about 1MT/PA. Today Consumption in Nigeria is between 1.5 to 1.7MT/PA.

Global consumption is 24kg per capita. Africa 16.8kg, Asia 17.3 kg, America 43.8kg and Europe 36.7kg per capita respectively. Nigeria is around 7 to 9kg. The Nigerian Sugar Development Council (NSDC) was established as the government agency responsible for formulating sugar policies and strategies.

NSDC focused towards promoting private sector-led development. Government-owned sugar estates were privatized in 2005. Investment in local sugar production is hampered by the huge funds required to establish a sugar estate as well as the lack of long-term loans for investment purposes in the country. However, the management of these estates improved under privatization, which also mostly accounted for the marginal increase recorded in sugar production.

Sugar use in industrial activities such as manufacturing soft drinks, pharmaceuticals, biscuits, other beverages and confectionery products is also rising steadily despite higher international prices, and there is no competing High-Fructose Corn Syrup (HFCS) in the market. Demand for direct household consumption also remains strong. More that 90 percent of Nigeria’s sugar needs are met by import of raw sugar, shipped mostly from Brazil, which is then refined by the local domestic sugar industry. The bulk of the available refined sugar supply is also exported from Brazil.

It would be recalled that the Nigerian Sugar Master Plan (NSMP) was introduced in 2012, as the roadmap to national sugar sufficiency, which was designed to increase local sugar production, attain self-sufficiency, reduce dependence on importation as well as create job opportunities and increase prospects of contributing to the production of ethanol in 2020. Currently, more than 90 percent of all sugar consumed in Nigeria is imported raw, mostly from Brazil, and refined by domestic sugar refineries.

DSR is one of the top five Sugar Refineries in the world, with 1.44MT/PA capacity at a location and has begun its backward integration project with a 10-year sugar development plan, to produce 1.5 million metric tonnes per annum (MT/PA) of sugar from locally grown sugarcane. The project commenced with its acquisition of Savannah Sugar Company Limited (SSCL) at Numan, in Adamawa State and other Green Project sites across Nigeria.

Apart from the rehabilitation of Savannah Sugar’s plantation and factory infrastructure, the company’s growth strategy to farm more than 150,000 hectares of planted sugarcane by 2023 includes the creation of integrated plantation and refinery facilities at the following locations; Lau/Tau, Taraba State; Hadejia, Jigawa State; Zaria Kalakala, Kebbi State and Kpada, Kwara/Kogi States.

This phase also includes the rehabilitation and expansion of Savannah Sugar’s estate, which will be used as a model for the other locations.

A report by the US Department of Agriculture (USDA) notes that to date, Dangote Sugar Refining is the only company to have developed a sugar estate and expanding its raw sugar production capacity.

It noted that Dangote acquired 95 per cent equity stake in Savanna Sugar Company (SSC) showed its commitment to becoming a fully integrated sugar company via its backward integration strategy. According to USDA, Dangote Sugar will be the company with the largest competitive advantage.

Recently during the visit of the National Assembly, Committee On Industry, Trade & Investment to the company, the lawmakers commended the management of Dangote Sugar Refinery on its remarkable progress towards ensuring the success of the sugar backward integration project.

The committee chairman, Honorable Abubakar Moriki who led the team expressed satisfaction at the level of the backward integration programme the company has been able to achieve.

He also assured the company of friendly policy formulation especially in land acquisition which is geared towards self-sufficiency of sugar in 2020. He said: “We are aware that for a sugar business to succeed there has to be substantial mass land acquisition for the sugar cane to be planted. We will look at these challenges and others affecting the industry.”

‘‘We have the responsibility as the members of the House of Assembly Committee on Industry to oversee the Federal Ministry of industry, Trade and Investment and alongside the agencies, which the National Sugar Development Council is one of them, being the regulatory agency charged with the responsibility of monitoring the implementation of national sugar policy globally and to come out with all implementation strategies to make us realized sugar self-sufficiency after certain period of time.

“We are here to see what extent has the policy of National Sugar impacted on you as a player in the industry and whether there are some amendments to make the implementation smoother and faster. We have visited the production site at the Savannah Sugar Company, Numan, Adamawa State, which is a typical backward integration starting point where we saw how the sugar canes were being produced, the collaboration you have with the host community in terms of the Out Growers Scheme and job creation.”

“We are happy at the development seen in Numan, which portrays a successful privatization. The company was sold to Dangote in 2003, it was sold as a moribund company but during our visit to the company, we found out it was back on its feet with about 12,000 hectare of land put into cultivation of sugar cane.”

He also urged the management of the Dangote Sugar Refinery to ensure maximal capacity utilization as much as possible to be able to refine sugar here for the mean time and to be able to have mechanism to produce sugar also in the factory.

The group managing director of Dangote Sugar Refinery, Abdullahi Sule said Nigeria is one of the world’s largest net importers of sugar, consuming significant amount of foreign exchange.

He noted that Dangote Sugar Master Plan was to ensure five large sugar factories, 150,000 Ha of land under cultivation, 1.5 to 2.0 million MT/PA of refined sugar from locally grown sugarcane per annual and to generate over 100,000 jobs among others.

He pointed out that Dangote Industries Limited acquired Savannah Sugar in 2003 and Dangote Sugar being a subsidiary of Dangote Industries acquired 95 per cent stake in Savannah Sugar in December 2012, and have invested over N33.05 billion.

He added that at the end of the rehabilitation exercise, Savannah Sugar will increase its sugar production to 260,000 MT per annual of refined sugar from 26,500ha cultivated land, at 12,000TCD daily, 190 days crop length, increase factory from 3,000TCD to 6,000TCD and install a 12000TCD diffuser factory, employ about 15,000 direct and indirect (seasonal) employees, produce 10MW power for export during crop, 18,000,000 liter per annum fuel ethanol and 10,000 MT per annum Animal feed from the by-products.

Sule however said that some of the challenges facing the industry are government policies, lack of infrastructures, stringent financing, huge investment, lack of forex among others.

Also, the director of Stakeholder Management and Corporate Communications of Dangote Industries, Mr. Mansur Ahmed said that the company was committed to the backward integration commitment it signed with the Federal Government, saying the Savannah Sugar Company acquired by the company in Numan, Adamawa, had started producing and plans were on for expansion.

He said that the current economic challenges in the country notwithstanding, the company is poised to remain a leader in the sector.

Cocoa; Investment Facts

INTRODUCTION
 
Cocoa is the second major non-oil foreign exchange earner in Nigeria. Cocoa is the leading agricultural export of the country and Nigeria is currently the world’s fourth largest producer of Cocoa.




SOURCING
 
Cocoa is produced mainly in 14 states namely; Ondo,Cross River, Oyo, Osun, Ekiti, Ogun, Edo, Kogi, Akwa Ibom, Delta, Abia, Kwara, Ebonyi and Rivers.


PRODUCTION STATISTICS
 
Nigeria’s annual production rate of cocoa beans is about 235,000 metric tonnes {MT}.


PLANTING SEASON
 
Planting of cocoa trees starts at the beginning of the rainy season.

PRICING
Cocoa currently sells for N380, 000 – N430, 000 per metric tonne.


USES
 
Cocoa’s main use is as a source material for Cocoa powder and Chocolate.
Cocoa butter which is a byproduct from cocoa is heavily used in the cosmetic and pharmaceutical industries.
The husks of cocoa pods and the pulp, or sweatings, surrounding the beans and the cocoa bean shells can be used in the production of Animal feed, soft drinks and alcohol.
Cocoa bean shells can be used an organic mulch and soil conditioner for the garden.
Potash from cocoa pod husk  is used mainly for soft soap manufacture. It may also be used as fertilizer for cocoa, vegetables, and food crops.


PROCESSING
 
Many products can be derived from cocoa.
Once the beans have been fermented and dried, they can be processed to produce a variety of products. These products include:
Cocoa butter is used in the manufacturing of chocolate. It is also widely used in cosmetic products such as moisturizing creams and soaps.
Cocoa powder can be used as an ingredient in almost any foodstuff.
Cocoa liquor is used with other ingredients, to produce chocolate. Chocolate is used as a product on its own or combined with other ingredients to form confectionery products.


EXPORT MARKET
 
The major export destinations of cocoa in Nigeria are; Netherland, UK, France, Germany, Spain, Italy, USA and Japan. Other emerging markets include China and India.


HARVESTING
 
The main crop is usually ready for harvest 5-6 months after the start of the wet season which is September- March and the mid-crop is harvested June- august.
STORAGE

 
Cocoa beans are normally stored in form of whole beans in jute bags for a relatively short period. They can be stored for 5 to 6 months safely.


COCOA INVESTMENT SUMMARY
Production
Processing
Export
Storage