Nigeria risks losing $20bn in cocoa exports in three years – FRC

Rabiu Olowo, executive secretary and chief financial officer, Financial Reporting Council of Nigeria (FRC), has said that Nigeria was at the risk of losing over $20 billion in cocoa export within the next three years, if it does not align with the processing and the reporting expectations of Europe.

Olowo, who spoke on during an oversight visit to the Financial Reporting Council of Nigeria by the House of Representatives Committee on Commerce in Abuja, said that adequate attention has to be paid to deforestation and farmland management, as the issue of sustainability is very important.

“It will interest you to note that the issue of sustainability is absolutely important, that’s why we’re driving it very, very rigorously.

“Nigeria is on the brink of losing over $20 billion in cocoa exports within the next three years if we do not align ourselves with the processing and the reporting expectations of Europe.

“It’s our cocoa they use in making chocolates and all of that. But if you don’t pay attention to deforestation, the way you arrange your farmland, the way you process your, I mean, and all of these things, your products or how good will not be competitive, and that is the real issue.”

Also speaking at the event, Ahmed Munir, chairman Committee on Commerce from the House of Representatives, had noted that for the first time in the Nigeria legislature, the committee has designed its four-year strategic plan to foster its commitment for effective legislative framework.

He said the visit is to enhance the collaborative relationship between the legislature through the committee and the executive.

According to CEPII research and expertise of the world economy, in 2022, Nigeria exported $489m in Cocoa Beans. The main destinations of Nigeria’s exports on Cocoa Beans were Netherlands ($189m), Indonesia ($105m), Malaysia ($87.9m), Canada ($29.4m), and United States ($16.9m). In 2022, Nigeria imported $47 in Cocoa Beans, mainly from Turkey ($47). These include Cocoa Beans (Raw/Roasted, Whole/Broken).

The research further shows that in 2022, Cocoa Beans were the world’s 423rd most traded product, with a total trade of $8.29b. Between 2021 and 2022 the exports of Cocoa Beans decreased by -20.3%, from $10.4b to $8.29b. Trade in Cocoa Beans represents 0.035% of total world trade.

Also, data from the National Bureau of Statistics (NBS) show that the value of total trade in agricultural goods in Q1 2024 revealed that export of agricultural products was dominated by ‘Sesamum seeds’ valued at N247.75 billion, ‘Superior quality Cocoa beans,’ with N230.85 billion and ‘Standard quality Cocoa beans’ with N140.09 billion.

Further analysis showed that ‘Sesamum seeds’ worth N83.29 billion and N58.04 billion were exported to China and Japan, respectively while “Superior quality Cocoa beans, worth N112.00 billion and N48.28 billion were exported to The Netherlands and Malaysia respectively. Whereas; ‘Standard quality Cocoa beans’ worth N58.29 billion and N37.77 billion were exported to The Netherlands and Malaysia, respectively.

Olowo also disclosed that the FRC has also concluded talks with the Minister of Agriculture and also the Minister of Environment, where they made very loud pronouncements and got good buying from corporate Nigeria to boost export and increase foreign exchange earnings.