As the race to dwarf foreign dominance of Nigeria’s chocolate market becomes more intense with the rise in local participation in production, there is need and opportunity for more players to join the local team to win the largest market share, agriculture stakeholders say.
But some new crop of processors says their effort face challenges from over-concentration of locally produced cocoa on exportation.
Tomi Shodimu, an Ilorin based graduate of chemistry passionate about food processing said cocoa farmers are reluctant about selling within the country because they are eager to export for the dollar benefit.
“That makes it hard for people who want to buy within the country. That Nigeria grows cocoa does not mean it is necessarily accessible as people think,” Sodimu told BusinessDay, noting that people are even more doubtful of making forays due to the lack of financial and infrastructural resources to compete healthily with foreign brands.
Foreign makers of chocolate lead the market, particularly in retail sales and have been innovating with pairing of new flavours to retain their dominance of the global market they serve.
Retail sales for chocolate confectionery in Nigeria rose to $39.7 million in 2017 from $25.9 million in 2012 and are projected to grow 5.2 percent to hit $51 million by 2022, according to Euromonitor International, a market data provider.
Giant makers, Mars and Mondelez, which sells to Cadbury Nigeria – make up the majority market with 37 and 11.2 percent respectively share in 2016, making Mars the largest chocolate company in the country.
Barry Callebaut, chief executive officer of Mars, world’s largest chocolate company sees demand for cocoa outweighing production by up to 1 million metric tons by 2020 according to Washington Post.
Whereas countries like Nigeria, Ivory Coast and Ghana, who account for over 70 percent of the world’s cocoa production, continue to groan about raking only a paltry sum of the total value of the global chocolate market.
The groaning could be on the verge of ending if more local companies like Shara, Honey Pot and Raw Essence attempt to join Cadbury and Multi Trex in exploring the possibilities of products obtainable from cocoa processing.
In its bid to promote natural food resources and a healthy lifestyle, Shara Foods for instance through value addition processes locally sourced Cocoa beans into chocolates alongside dried fruits and food products.
Nestle Nigeria with different brands of chocolates vie with Cadbury chocolates in the market place as well as Multi Trex that has launched huge production of chocolate bars in Nigeria. Multi Trex is one of the companies that aim to compete favourably with international companies in the production of chocolate bars.
According to BusinessDay’s calculations, If local processors completely used Nigeria’s cocoa in 2018, the country’s second-largest export earner after oil, in making products like butter and cake before exporting in 2018, an additional $275 million could have been made in the process.
For every 2.6 metric tonnes of raw cocoa beans, a processor gets a tonne of butter and 1.5MT of cake. The average price of processed cocoa intermediate products, such as butter and cake, for 2018 was $7,429 and $ 1,300 per tonne.
Nigeria ranks joint fifth with Cameroun with 210,000 metric tonnes production in the 2016-2017 season, the International Cocoa Organisation (ICCO) states.
