Nigeria is yet to recover and take its proper place among the comity of crude palm oil-producing nations following the discovery of oil that changed the country’s palm oil narrative of the 60s.
Since the discovery of crude oil, Nigeria lost its position as one of the world’s largest palm oil producers, pushing Indonesia and Malaysia to become global leaders in oil palm production.
Worried by this, stakeholders in the sector are seeking ways to ensure that the country regains its place in the comity of nations producing crude palm oil.
According to stakeholders, the country’s palm oil production is estimated at 900,000 to 1.3 million metric tonnes while the local demand is put at 2.1 million metric tonnes, which puts the supply gap at 800,000 metric tonnes.
This has led to a rise in oil palm import to meet the huge demand-supply gap. Also, in a bid to tackle smuggling and boost local production of agricultural produce in the country, the government had, since August 2019, shut the Nigerian borders with neighbouring West African countries.
Experts say that the border closure has had a positive impact on the oil palm industry as importers that smuggle the produce from neighbouring countries into Nigeria, through the land borders, now import directly and legally into the country, thereby increasing government’s revenue.
Igwe Hilary Uche, National President, Oil Palm Growers’ Association of Nigeria (OPGAN), stated that the association initiated the border closure and that the closure has affected the sector positively.
He said that the people smuggling and bringing palm oil into the country are detractors creating additional problems for Nigeria. Igwe said that the association was not talking about the Anchors Borrowers’ Programme again because the programme has been hijacked by most state governors.
He said that the association had opened talks with the Central Bank of Nigeria (CBN) on funding oil palm farming, saying that if properly implemented could bring Nigeria back to its rightful place in the global palm oil economy.
“We are not talking about the Anchor Borrowers’ Programme again because that programme was hijacked by state governors.
The one we are talking about now is the funding of oil palm farmers by the Central Bank of Nigeria.
That is what we are talking about now,” he said. The OPGAN president noted that the association is releasing the modalities for the CBN the way it wants. “We are releasing the modalities for them.
That is what I am doing now, the way we want it, how many are we, what we need to give Nigeria, what Nigeria wants; that is what we are doing and we are submitting it to CBN.
If they do it the way we want it, in the next three to four years, Nigeria will have a new face to this economy.
It will bring back the lost glory of Nigeria in the global palm oil economy,” he added. Victor Iyama, National President, Federation of Agricultural Commodity Association of Nigeria (FACAN), noted that the border closure has affected the palm oil industry positively; saying before now a huge volume of palm oil was being smuggled into the country.
He said that with the border closure, Nigerian farmers who are producing palm oil would be able to make good profits as compensation for their efforts just as more people would be encouraged to go into its production.
Iyama stated that for smuggling of palm oil to be curtailed, the nation must encourage solid input and investment and also drive down the cost of production.
“By the time we encourage solid input and investments by all and sundry, we can produce our palm oil at a lower price, we can flood the market, of course, one will not be able to smuggle.
“If you want to go and smuggle what you want to sell for N7,000 per 30 litres, for example, and we are selling locally produced palm oil for N5,000 per 30 litres, where will you get the market? So, it is for us to drive down our cost of production and produce more and that is the permanent solution,” he added.
Speaking on the Anchor Borrowers’ Programme, he advocated for an extension of the programme to palm oil farmers, saying 80 per cent of the palm oil the nation consumes is produced by small-holder farmers. He also advocated for a five per cent interest rate on anything across the value chain for agriculture, stating that he has never been in support of nine per cent interest rate loan, for the nation to do well agriculturally. “For me, I have always been an advocate of a five per cent interest rate for anything across the value chain for agriculture.
I have never been in support of nine per cent for us to do well and break even. It has to be five per cent. In all the climes we are claiming to be talking about, it is not more than two per cent. For anything agriculture along the value chain, it should not be more than five per cent,” he added.
Henry Olatujoye, former National President of National Palm Produce Association of Nigeria (NPPAN), who also corroborated Iyama and Igwe, added that border closure had affected the sector positively because the demand for palm oil in Nigeria for long was very high. “Before, we were not able to produce to meet our daily consumption.
That opened doors for importation and illegal activities across the border. So, the border closure has helped to sanitise the chain in the sector. It has seriously reduced illegal activities and it has further increased revenue to the government.
It has also spurred investors to invest more, many people are coming up with 50,000, 100,000 hectares in addition to our plantations,” he said. Olatujoye, who is also the CEO of Palmfield Development & Processing Limited while speaking on stemming the tide of smuggling into the country, said it depends on Nigerians.
He said that the government can roll out programmes but that the problem lies with the policy predators.
“If the government says this is not allowed, let it be disallowed. Smuggling is a trade that is not favourable for persons in my age but the only thing we can do is for Nigerians to show commitment to their country,” he added. Speaking further, he called on the government demonstrate more seriousness about tree crops development in the country, especially those that have an economic value such as palm oil, cocoa, rubber, and the likes.
“Government should not leave it in the hands of investors. No matter how much investors’ bring into Nigeria, they cannot plant palm trees in the nation, they will still want to use our money to do it. So, what the government needs to do is to fund oil palm and all tree crops through social intervention money.
The government must encourage people to plant by providing seedlings, inputs, land as they did during the good old days.
“Those governments did it then and they did not borrow any money from any bank, we need just one billion hectares to get out of this,” he said.