Johnvents Industries Limited, a new cocoa processing factory in Akure, Ondo State, has stated that it intends to boost Nigeria’s foreign exchange reserves through cocoa exports, beginning with a $1 million pilot export.
Mr. John Alamu, Group Managing Director of CapitalSage Holdings, the parent company of Johnvents Industries Limited, stated during an interview that adequate forex could be generated for the country through cocoa exports.
He stated that the company was planning its first major export worth more than $1 million, which would help boost the country’s foreign exchange reserves.
“Our first export is worth more than a million dollars, and we are exporting both powder and cake.” This company helps the economy in a variety of ways. One aspect is the generation of FX. Nigeria needs more exports to balance its foreign exchange reserves, and this factory will make a significant contribution to that,” he said.
According to International Cocoa Organization reports, cocoa production in Nigeria has been declining over the years, reaching 210,000 metric tons in 2017 despite rising demand for the product.
Nigeria is now ranked fourth in the world in terms of cocoa production.
Despite the numerous challenges confronting the local cocoa industry, the business mogul stated that the factory is committed to increasing production and exports of the commodity.
“We have to keep the factory running despite challenges,” said Johnvents’ CEO. It is a factory that operates 24 hours a day, seven days a week. As a result, we must keep it running at all costs.” We have no choice but to respond to market demands for raw materials. We pay a premium, but the unfortunate thing is that the price in the international market is not rising in tandem with the cost of raw materials.”
“What we are doing is that we are producing and storing up while monitoring the market price to see when is the best time to sell some,” Alamu said of the company’s response to the cocoa market.
“However, we are prepared to make our first export.” I’d like to point out that, despite the fact that while the international market price of cocoa powder has decreased, the local market price has increased significantly, which is quite unusual. As a result, this is helping to bridge the price gap on the international market.”
According to the Nigeria Export Import Bank, raw cocoa exports cause Nigeria to lose up to $190 billion per year, despite the fact that Nigeria’s cocoa revenue should be around $200 billion per year.
Alamu emphasized the importance of the country focusing more on refining raw materials rather than exporting them directly.
“We need to address production,” he said. Nigeria used to be a world leader in cocoa production, but we are now ranked fourth. Ivory Coast is first, followed by Ghana, and then by Indonesia. The disparity is quite concerning. We believe that processing and value addition will increase output and exports.
“It is preferable that we handle post-harvest in Nigeria and add value in Nigeria.” We will receive a higher premium, and the farmers will receive a higher premium for the cocoa they produce, when compared to simply exporting raw materials, the cocoa bean.”
The Johnvents CEO also emphasized the importance of policies that promote a welcoming business environment, noting that traffic at the Lagos port makes export difficult.
He urged the government to step in and help firms looking to export goods make the process as simple as possible.
“Also, I believe policies that promote a very friendly business environment will help Nigeria reclaim its top spot in cocoa exportation,” Alamu added.
“I’ll specifically address the port issue.” Today’s traffic at Lagos’s port does not make exportation appealing or easy. You might end up with your goods there for two months at a time. We’ve been working on pilot exports for quite some time. “We had to switch ports.” It is something that, if the government intervenes, will make exporting easier, which will boost Nigerian exports.”