The emergence of agro-businesses in Nigeria is proof that the Nigerian economy is moving closer to a state of food sufficiency
There seems to be a high birth of startups across various industries in Nigeria. According to SMEDAN, in the past four (4) years, Nigeria has recorded a 12.3% increase in the number of existing Micro Small and Medium Enterprises (MSMEs) – with Wholesale/Retail trade, Agriculture and other services making up 76.3% of microbusinesses. This increase in the number of MSMEs may also be because of various policies implemented by the Nigerian Government, and initiatives by Not-for-profit Organisations (such as the Tony Elumelu Foundation and the W-Initiative) amongst others, to support businesses in Nigeria. These policies increase access to funding and provide mentorship and partnership platforms for MSMEs to thrive in the Nigerian environment despite the challenges faced by Nigerian business owners in terms of poor infrastructure, unstable inflation rates, inadequate capital etc. One sector that has benefited the most from these policies and initiatives is the Agricultural sector.
According SMEDAN, The Agricultural sector witnessed an 11.98% increase in the number of small businesses between 2013 and 2018 – with over nine (9) million new SMEs. With the introduction of modern technology, farming in Nigeria has evolved from predominantly consisting of subsistence and smallholder farming to large scale farming for commercial purposes. The sector has also become an attractive business venture. In 2013, Agriculture accounted for 8.92% of MSMEs in Nigeria. This figure rose to 29.3% in 2018. Agriculture is currently the largest employer of labour and accounts for 23.9% of total GDP.
With the recent ban placed on staple food items such as frozen poultry, eggs etc. the market has created an opportunity for local farms to thrive and gain a high percentage of the market share, competing heads on with larger farms such as Obasanjo farms and Maizube farms, while implementing and adapting modern farming methods such as Greenhouse farming. In the case of Green House Farming, The peculiar glass/plastic walls and roofs serve as a safe haven for weather sensitive plants such as tomatoes, peppers, apples, berries etc. by regulating temperature and humidity hence protecting them from external weather conditions. Two notable local farms were profiled to be leveraging technology and rising as giants in the Nigerian agricultural sector: Forthworth Farms and HillCrest Agro-allied.
Forthworth Farms is one of several locally owned farms currently leveraging the Greenhouse farming technique and is scaling rapidly to become a major player in Nigeria’s agricultural sector. Founded in 2007, spurred by the founders’ love for passion and animals with just ten (10) birds in a flat apartment, the company has grown to investing in a fully developed sixty (60) acre land with one hundred and twenty (120) employees and a total farm capacity of two hundred thousand (200,000) birds. In 2014, Forthworth diversified into Greenhouse farming with five (5) Greenhouses and had grown to twenty (20) greenhouses at the end of July 2017; producing vegetables such as Tomatoes, Onions, Peppers, Scotch Bonnet, amongst others.
Forthworth adapts an integrated system of farming that ensures no part of their production process goes to waste, the manure/fertilizer used in the Greenhouses are sourced from poultry waste. This ensures minimal exposure of vegetables to chemicals. Forthworth also runs an end-to-end production process and controls cultivation of products to final distribution. The company is positioning to be a one stop shop for the preparation of a pot of stew.
Turning the chapter to Rice production. According to the Gems4 Rice cluster report; the national demand for rice in Nigeria was recorded as 7 million tonnes in 2017 with an annual production rate of 5.7 million tonnes. Government intervention in rice production, by providing improved seedlings and fertilizers to smallholder farmers, and going as far as granting land concessions as investment incentives to large commercial farmers in some states has led to significant strides towards its goal of rice self-sufficiency. According to the Nigerian Government, Nigeria is now Rice sufficient. This is hard to determine because of the porous borders and existing smuggling of foreign rice, until the recent boarder closure. The demand for imported rice is not only based on a supply deficit but it can also be traced to the fact that urban consumers perceive imported rice to be of higher quality than locally produced rice. There has been a downward trend in the demand for imported rice as a result of Government’s policies on import substitution – import tariffs and inclusion of rice in the list of forty-one (41) items ineligible for forex in the official market. This has led to an increase in the number of local rice farms in Nigeria adapting modern technological farming methods one of which is HillCrest Agro-allied industries limited, under the brand name Famous Rice – which boasts of proudly sourcing its Paddy from local farmers.
HillCrest Agro-allied is an agricultural products processing company in Kwara State. It started as a unit under Dayntee Farms limited and was incorporated in 2013. The company runs and operates an end-to-end fourteen (14) MT per hour (75,000MT per annum) rice processing mill that produces par-boiled rice. Other notable local brands that have defied all the odds – serving as dominant indigenous producers include:
- UMZA (75, 000 MT)
- AA Ibrahim (120, 000 MT)
- Labana (100, 000MT)
The emergence of agro-businesses in Nigeria is proof that the Nigerian economy is moving closer to a state of food sufficiency. We applaud all existing agro-business owners and encourage youths to take hold of the current opportunities in the agricultural value-chain. Some analysts think Agriculture is Nigeria’s next Oil and Gas.