Unlocking the Potential of Agriculture in Sub-Saharan Africa: - - PowerPoint PPT Presentation

Federal Ministry of Agriculture and Rural Development |

Unlocking the Potential of Agriculture in Sub-Saharan Africa: Nigeria‟s Transformation Agenda for Agriculture

• Dr. Akinwumi Adesina, PhD (Purdue)

Honourable Minister of Agriculture and Rural Development

Presented at the Symposium on „Growing food: New places, new technologies‟ Johns Hopkins University School of Advanced International Studies

April 17th 2012

Federal Ministry of Agriculture and Rural Development |

Low Agricultural Productivity is at the heart of food insecurity in Africa

Source: FAOSTAT (2001)

1961 1966 1971 1976 1981 1986 1991 1996 2010… 1 2 3 4 5 6

China S.Asia SS Africa

Cereal Yields t/ha

Federal Ministry of Agriculture and Rural Development |

Federal Ministry of Agriculture and Rural Development |

Netherlands Vietnam Japan UK China France Brazil USA India South Africa Cuba Benin Malawi Ethiopia Mali Burkina Faso Nigeria Tanzania Mozambique Guinea Ghana Uganda

kg/ha

Source: FAOSTAT, July 2003; Norman Borlaug, 2004

100 200 300 400

Fert rtil ilizer izer use per ha in sub-Sa Saharan aran Af Afri rica ca is is the lowe west t in the wo world

500 600

Federal Ministry of Agriculture and Rural Development |

• 1. Focus was on wheat and rice, which were not major crops

in Africa

• 2. Africa has a more diverse agro-ecological environment

than Asia

• 3. While Asia has homogenous irrigated areas, Africa is

dominated by rain-fed agricultural

• 4. Weak political will in Africa compared to Asia
• 5. African countries had weaker infrastructure, policies and

institutions to support farmers

Why the green revolution bypassed Africa

Federal Ministry of Agriculture and Rural Development |

• New Rice for Africa (NERICA)

 Africa’s rice imports has risen from 8.5 Billion USD in 1986 to close to 150 Billion USD per year  in 1980-2000 over 200 new varieties of rice were released and generated annual income of US$ 375-850 Million

• High Yielding Cassava Varieties

 Pro Vitamin A Cassava in Nigeria  To save 1.5 Billion USD in GDP loss to vitamin and mineral deficiencies

• Orange Flesh Sweet Potato
• Water Efficient Maize for Africa
• Drought Tolerant Maize for Africa
• 20-30% yield increase, Yield stability

Technologies now exist to allow Africa to feed itself

Federal Ministry of Agriculture and Rural Development |

– Biotechnology offers great potential to help feed Africa – Bt-cotton is growing in West Africa and South Africa – Successful development and testing of GM maize in Kenya and South Africa, and GM bananas in Uganda, to address pest and disease complexes – Challenges that must be overcome for gene revolution

• Conventional breeding still holds the best option
• Public research institutions are dominant, not private research institutions
• Unlike in green revolution in Asia, seeds from gene revolution are

commercial, not public goods (farmers need to be able to reuse seeds)

• Limited public-private partnerships for sharing proprietary technologies for

crops of importance for the (Africa Agricultural Technology Foundation)

• Weak biosafety regulatory framework in many countries
• Environmental and consumer safety issues

The new gene revolution should not bypass Africa

Federal Ministry of Agriculture and Rural Development |

“We must feed ourselves. I will not suffer the indignity

• f begging for food”

Late Dr Bingu wa Mutharika President of Malawi

African leaders are combining political will with technologies, markets and institutional support for farmers

Federal Ministry of Agriculture and Rural Development |

Tipping Point on Hunger in Africa: Malawi achieves food self sufficiency

• 2005/06: $50 Million subsidy with

Government distribution

• 2006/07: $60 Million “smart

subsidy”

• Maize green revolution:

400,000 MT surplus in 2005/06 900,000 MT surplus in 2007 Malawi exported 400,000 MT of maize to Zimbabwe Malawi donated 10,000 MT of maize to Lesotho and Swaziland

Federal Ministry of Agriculture and Rural Development |

African Governments’ decided to devote 10% of National Budget for Agriculture: CAADP Maputo Declaration

Federal Ministry of Agriculture and Rural Development | 10

Federal Ministry of Agriculture and Rural Development |

Nigeria is an untapped potential agricultural power house

Land Water Labor Large Internal Markets

Agricultural Potential

• 84 Million Ha of Arable

Land; 40% utilization

• 279 Billion Cubic

Meters of Surface Water

• Untapped irrigation

potential with 3 of the 8 major river systems in Africa.

• 110 Million Youth in the

work force in 2020

• Low wages for

agricultural intensification

• 165 Million people,

projected to grow to 470 Million by 2050

11

Federal Ministry of Agriculture and Rural Development |

Nigeria's lost glory in the world trade of groundnuts

Our former glory in the global trade of groundnut – Circa 1961

Share of world‟s shelled groundnut exports in 1961* Measure: % of world trade Others

Nigeria‟s dominance was eclipsed by China, USA and Argentina

Nigeria Nigeria‟s export volumes compared to global export volumes for shelled groundnut 1961 – 2008* Measure: Thousands of metric tons 16% 0% Nigeria‟s Exports Global Exports Global market-share trend of shelled groundnut among key producers** Measure: Percent of global trade of shelled Groundnut USA Nigeria China

• Our competitors maintained their

dominance due to strong marketing

• rganizations that linked the farmers to

markets and hence were able to meet new strict sanitary and phytosanitary requirements, particularly for Aflatoxin, a serious food toxin.

• New technologies, Aflasafe, have been

developed in Nigeria by IITA to enable Nigeria meet the new strict sanitary and phytosanitary requirements.

Argentina 2008 12

*FAO ** Doreo Analysis, FAO

Federal Ministry of Agriculture and Rural Development |

Nigeria's lost glory in the world trade of palm oil

Our former glory in global trade of palm oil – Circa 1961

Share of world‟s palm oil exports in 1961* Measure: % of world trade Others

Nigeria‟s dominance was eclipsed by Indonesia and Malaysia

Nigeria Nigeria‟s export volumes compared to global export volumes 1961 – 2008** Measure: Thousands of metric tons 4% 9% Nigeria‟s Exports Global Exports Global market-share trend of palm oil among key producers** Measure: Percent of global trade of palm oil Malaysia Nigeria Indonesia

• While Nigeria declined rapidly, the

industry grew even faster to over 33 Million metric tons.

• Our competitors continued to invest in

their agricultural sector R&D to develop higher yielding varieties and remain competitive

• Malaysia now controls 40% of the

world trade of Oil Palm products valued at over US$18 Billion

2008 13

*FAO ** Doreo Analysis, FAO

Federal Ministry of Agriculture and Rural Development |

Nigeria's stagnation in the world trade of cocoa

Our former glory in global trade of cocoa – Circa 1961

Share of world‟s cocoa exports in 1961* Measure: % of world trade Others

Nigeria‟s dominance was eclipsed by Indonesia and Cote d„Ivoire

Nigeria Nigeria‟s export volumes 1961 – 2008* Measure: Thousands of metric tons 0.4% Nigeria‟s exports Global market-share trend of cocoa among key producers*** Measure: Percent of global trade of cocoa Cote d„Ivoire Nigeria Ghana

• While Nigeria‟s production stagnated,

the industry grew to over 2.7 Million MT.

• Our competitors maintained their

dominance due to strong marketing

• rganizations
• Our stagnation has meant we have

been unable to benefit fully from rapidly rising global prices.

Indonesia 2008

*FAO ** Index Mundi *** Doreo Analysis, FAO

Cocoa Bean Price ** Measure : US$ per metric ton

2011 2005 2009 2001 2003 2007

14

Federal Ministry of Agriculture and Rural Development |

Nigeria's lost glory in the world trade of cotton

Our former position in global trade of cotton – Circa 1961

Share of the world‟s cotton exports in 1961* Measure: % of world trade Others

Nigeria‟s dominance was eclipsed by Mali and Burkina Faso

Nigeria Nigeria‟s export volumes compared to global export volumes 1961 – 2008* Measure: Thousands of metric tons 2% 1% Nigeria‟s exports Global exports Global market-share trend of Cotton among key West African producers ** Measure: Percent of global trade of Cotton Mali Nigeria Burkina Faso

• In 1961, Nigeria was the major West

African cotton exporter , however, its prominence has been eclipsed by Mali and Burkina Faso.

• Our competitors maintained their

dominance due to strong marketing

• rganizations, that linked the farmers to

markets and provided support in the form of improved planting materials and fertilizer and the ability to meet quality standards.

2008 15

*FAO **Doreo Analysis, FAO

Federal Ministry of Agriculture and Rural Development |

Need to raise agricultural productivity in Nigeria

Comparison of Nigeria‟s yields across all crops versus

• ther leading agricultural countries

16 Index of crop yields relative to Nigeria‟s yields in 1961* Measure: Relative growth in crop yields Malaysia Thailand Annual growth rates 1961 – 2008 3% Nigeria 1961 2008 1980

• Yield per Hectare is the driver of

agricultural competitiveness.

• Nigeria's yield per hectare is 20% to

50% of that obtained in similar developing countries.

• Nigeria has one of the lowest usage

rates of agricultural inputs.

• Nigeria ranks at the bottom on

agricultural indices

• Mechanization Intensity: 10 tractors

per 1000 Ha compared to Indonesia with 241 tractors per 1000 Ha

• Irrigation: 0.8% of arable land

irrigated compared to Thailand‟s 28%

• f arable land irrigated

Indonesia Brazil 2% 2.3% 1.6% 1.2% 1990 2000 1970 Nigeria‟s low fertilizer utilization** Measure: Kg per hectare Nigeria‟s low utilization of improved seeds** Measure: Percent of farmers

* Doreo‟s Analysis, FAO **IFDC Indonesia lowest in 1961

Federal Ministry of Agriculture and Rural Development | 17

Nigeria Imports over USD$11 Billion in wheat, rice, sugar and fish every year

Sugar Fish Wheat World‟s largest importer

• f US hard red and

white winter Wheat Nigeria‟s top 4 food imports * Measure: Annual food imports in billions of naira Nigeria‟s imports

• Nigeria‟s food imports are growing at an

unsustainable rate of 11% per annum.

• Relying on the import of expensive food on

global markets fuels domestic inflation.

• Excessive imports putting high pressure on

the Naira and hurting the economy

• Nigeria is importing what it can produce in

abundance.

• Import dependency is hurting Nigerian

farmers, displacing local production and creating rising unemployment.

• Import dependency is not acceptable, nor

sustainable fiscally, economically or politically. Key takeaways

*CBN

Rice World‟s #2 Importer

Federal Ministry of Agriculture and Rural Development | 18

Agricultural Transformation Action Plan

Turning Nigeria from a food importing country to a self-sufficient and food exporting country

Federal Ministry of Agriculture and Rural Development |

Significant Growth in Non-oil Exports and Agriculture Dominates Non-Oil Sector Growth

Agriculture consistently 75% of Non Oil Exports Value of agriculture and other non-oil exports (N Bn)

Source: CBN, FBN Cpital

100 150 190 210 295 35 50 55 60 100 2006 2007 2008 2009 2010

Agriculture Sector Other Non Oil Sectors

19

Federal Ministry of Agriculture and Rural Development | 20

69 52 36 256 99 Potential 2030 Shift to Higher Value Crops 1 Increased Yield Increased Acreage 2010 +159%

Value of Agricultural Sector, constant 2010 US $ (Billions of dollars)

44% 33% 23% Share of growth, % Current Additional potential

Agriculture‟s potential to grow the economy

Federal Ministry of Agriculture and Rural Development |

Nigeria must become an agriculturally industrialized economy We want to modernize the agricultural sector, raise agricultural productivity, develop modern food supply chains, accelerate food processing and value addition, and achieve economies of scale in food production and supply to meet the food needs of Africa's largest population. While Nigeria is the largest food market, we are import dependent, so unable to create jobs, drive markets for locally produced crops. We have decided to end this. Now our goal is "process what we produce, promote locally produced foods, make our farmers prosperous and create jobs". We want prosperity to grow in our rural areas, as our food supply chains grow, for local, regional and export markets.

Key drivers for our transformation

Rapid Urbanization Rising Population Growth in Food Demand Need to Create Jobs Post Harvest Losses

• The percentage of the population in

Urban Areas has doubled in 40 years from 24% to 49%

• The Nigerian population has doubled in

the last 30 years from 80 Million in 1982 to 165 Million in 2012, and is projected to reach 450 Million by 2050

• Increased population coupled with

increased meat and fats consumption driving up food demand.

• Over 4 million youths entering the

workforce every year.

• 50% for vegetables and fruits,
• 30% for tubers and roots
• 20% for grains

Federal Ministry of Agriculture and Rural Development |

Our Vision: Grow Nigeria‟s agricultural sector

22

“To make Nigeria an agriculturally industrialized economy” What we have stopped doing

× Treating agriculture as a development project × Isolated projects that do not clearly grow the sector in a clear and measurable way. × Big government crowding out the private sector

Federal Ministry of Agriculture and Rural Development |

Our Vision: Grow Nigeria‟s agricultural sector

23

“To make Nigeria an agriculturally industrialized economy” What we have started doing!

 Treating agriculture as a business  Integrating food production, storage, food processing and industrial manufacturing by value chains („farm to fork‟)  Focusing on value chains where Nigeria has comparative advantage  Using agriculture to create jobs, wealth and ensure food security  Investment-driven strategic partnerships with the private sector  Investment drives to unlock potential of our States in agriculture (joint drives with State Governors)

Federal Ministry of Agriculture and Rural Development | 24

New policies, institutions and financing structures to drive sector growth:

1. Deregulation of seed and fertilizer sectors 2. Marketing reforms to structure markets 3. Innovative financing for agriculture 4. New agricultural investment framework

Federal Ministry of Agriculture and Rural Development |

Policy reform: Government gets out of direct fertilizer procurement and distribution and leverages mobile phones to target farmers with farm inputs

• Government no longer buys and sells fertilizers and

seeds

• Private sector now sell fertilizers and seeds directly to

farmers

• Government provides 50% support for seeds & fertilizers
• Vouchers and Electronic-Wallets (mobile phones) are

being used to better target subsidized inputs to farmers, with target of reaching 5 million farmers per year

• Banking system is being used to finance input supply:

 30 Billion Naira was financed for 2102, using guarantees, without spending a single Naira of government funds

• Government has liberalized foundation seed production

to private sector to accelerate growth of the seed sector  Establishing a Nigerian Seed Venture Capital Fund.  Goal is to grow the use of hybrid seeds from 8,000 metric tons to 1,000,000 metric tons, per year

25

Federal Ministry of Agriculture and Rural Development |

Marketing Corporations and Commodity Exchanges are being established to facilitate marketing for agricultural commodities

Leading global examples of marketing corporations

26

• We are establishing MARKETING

CORPORATIONS to coordinate the production, investments, grades and standards, market price stabilization etc. for all value chains in Nigeria

• Marketing Corporations will be
• wned by agricultural value chains,

run as private sector led institutions

• Agricultural commodity exchange to

improve market access and price stabilization for farmers

Federal Ministry of Agriculture and Rural Development | 27

NIRSAL : ₦75 billion assets to stimulate lending by banks and other financial players )

De-risk agriculture finance value chain Build long- term capacity Institutionalise incentives for agriculture lending NIRSAL Objective Goal Expand bank lending in agricultural value chains Risk sharing Facility (₦45B) Insurance Facility (₦4.5B) Technical assistance facility (₦9B) Bank incentive mechanism (₦15B) Agricultural bank rating scheme (₦1.5B)

• Shares

lending risks with banks (e.g. 50% loss incurred)

• Link

insurance products to the loan provided by the banks to loan bene- ficiaries

• Build the

capacity of banks, micro- finance institutions

• Build

capacity of agricultural value chains

• Expand

financial inclusion Targeted incentives that move banks to a long term, strategic commitment to agricultural lending

• Rate

banks according to their effective- ness of lending to agriculture .

New Financing Framework for Agriculture by Central Bank of Nigeria will unlock $ 3 billion in affordable loans from banks for agricultural value chains

Federal Ministry of Agriculture and Rural Development |

Staple Crop Processing Zones (SCPZ) to drive food processing and manufacturing industries and infrastructure investments

28

Sample Agro Processing Plant

• Attract private investors into areas of high food

production to set up food processing plants

• Reduce current high levels of post-harvest losses,

add value for increased local content of foods

• Link farmers in clusters to food manufacturing plants
• Create jobs and drive rapid rural economic growth
• Staple Crop Processing Zones will receive Fiscal,

Investment and Infrastructure incentives:

• Tax breaks on import of agro-processing

equipments

• Tax holidays for food processors
• Supportive infrastructure: power, roads,

logistics, storage facilities, cargo airports

• Develop Agricultural Investment Code for Nigeria

Federal Ministry of Agriculture and Rural Development |

Target commodity value chains for investments by zones

Adamawa Akwa Ibom Bauchi Bay e- lsa Benue Borno Cross River Delta Ebonyi Edo Ekiti Enugu FCT1) Gom be Imo Jigawa Kaduna Kano Katsina Kebbi Kogi Kwara Lagos Nasarawa Niger Ogun Ondo Osun Oyo Plateau Rivers Sokoto Taraba Yobe Zamfara Abia Ana- mbra

• Cotton, Onion, Tomato and Sorghum +

Rice & Cassava + Livestock & Fisheries

NW

• Cotton, Onion, Tomato and Sorghum +

Rice & Cassava + Livestock & Fisheries

NE

• Maize and Soybean + Rice & Cassava +

Livestock & Fisheries

NC

• Oil Palm and Cocoa + Rice & Cassava+

Livestock & Fisheries

SW

• Oil Palm and Cocoa + Rice & Cassava +

Livestock & Fisheries

SS

• Oil Palm and Cocoa + Rice & Cassava +

Livestock & Fisheries

SE

Federal Ministry of Agriculture and Rural Development | 30

Rice Transformation Plan

Nigeria to be self sufficient in rice in four years and become the largest processor of locally produced rice in Africa

Federal Ministry of Agriculture and Rural Development |

Nigeria will replace imported brown rice and finished parboiled rice with domestic production and milling of rice

31 Annual Brown Rice Supply Options Import vs. Domestic Supply Measure: Millions Metric Tons

Import Substitution of Parboiled Brown Rice Import Substitution of Parboiled Finished Rice Imported PB brown rice Domestically produced PB brown rice

Annual Finished Rice Supply Options Import vs. Domestic Supply Measure: Millions Metric Tons

Imported PB Rice Domestically Produced PB Rice

• Replace imported brown rice with locally

produced brown rice by 2013.

• Replace imported finished rice with locally

produced brown rice by 2015.

• Imports will be substituted by stimulating

private sector to invest in rice processing facilities in areas of high production

Federal Ministry of Agriculture and Rural Development |

Summary of actions to date

32

US investor invests $40 million in rice production and milling in Taraba State (February 2012)  Expected production of 300,000 MT of rice (15% of imports) and creation of 15,000 jobs  This will become the largest rice farm in Africa. Investors rush to produce and mill local rice in Nigeria

Federal Ministry of Agriculture and Rural Development |

Nigeria to have the largest high quality locally produced rice processing capacity in Africa

33

• Investment facility concluded

(February 2012) for 100 large scale integrated rice processing mills, with total capacity for 2 million MT

• f milled rice, per year
• Mills to be owned and operated by

the private sector

• Mills to be located across major

rice producing States, with completion period of 18-24 months

• Progress already made

 3 new rice processing mills in Ebonyi, Niger and Kebbi States with capacity of 90,000 tons of milled rice have been completed (February 2012).

Federal Ministry of Agriculture and Rural Development |

High Quality Nigerian Rice: EBONY Rice, Ebonyi

34

High Quality Nigerian Rice rolled out: EBONY Rice, Ebonyi (March 2012)

Federal Ministry of Agriculture and Rural Development | 35

• Cassava Transformation Action Plan

Nigeria to become the largest processor of cassava in the world

Federal Ministry of Agriculture and Rural Development |

Cassava Value Chains to drive new industrial growth

36

HQCF High Quality Cassava Flour (HQCF)

• Principal market –replacement of wheat flour in bread; others – food industry, adhesive

industry, dextrins. Starch Native and modified starches

• We have two functional starch mills in Nigeria with a combined capacity of 20,000 tons

(although they currently operate below capacity).

• Demand is currently met by corn starch imports.

Chips Dried Chips

• Principal market – to meet internal and external demand of cassava for industrial use.

China‟s demand is expected to exceed 12 mill tons by 2015/16 due to their large ethanol production. HFCS Sweeteners - High Fructose Cassava Syrup (HFCS)

• The total sugar requirement for soft drink bottlers and juice manufacturers in Nigeria is

estimated at 200,000 tons of sugar p/a. A replacement of half of this by HFCS from cassava, would create a 100,000 ton demand. Ethanol Fuel Ethanol (E10)

• Nigeria has adopted the policy of blending gasoline with 10% ethanol, the E-10 policy.

This represents a potential one billion liter per year market of fuel ethanol and, assuming 50% of feedstock comes from cassava, a raw material requirement of 11 million tons of dried chips is required.

Federal Ministry of Agriculture and Rural Development | 37

• Mr. President launched 40% High Quality Cassava Flour Bread on 30

November, 2011 and challenged the private sector to commercialize

Federal Ministry of Agriculture and Rural Development | 38

Private Sector Success: Largest bread baker, UTC, commercializes cassava flour bread (February 2012) that is cheaper than 100% wheat flour bread, and encourages local content for jobs

Federal Ministry of Agriculture and Rural Development | 39

UTC Pastries (30% High Quality Cassava Flour)

Federal Ministry of Agriculture and Rural Development |

New Investments to make Nigeria the Largest Processor of Cassava Flour in the World

40

• 1. Procurement and installation of 18 large scale industrial processing

plants for producing High Quality Cassava Flour (HQCF)

• Total capacity of 1.3 Million MT per year
• 2. Processing plants to be run and owned by the private sector
• 3. The mills will support a massive structural shift in the flour milling and

bakery industry towards greater use of cassava flour in bread etc.

• 4. The mills will be supported with massive expansion in cassava

production, using medium and large scale mechanized cassava farms

• 5. Nigeria will save USD$2 Billion annually, create markets for 1.6 Mil MT
• f HQCF, 6.4 Million MT of cassava, and thousands of jobs

Federal Ministry of Agriculture and Rural Development | 41

Cocoa Transformation Action Plan Nigeria to become the largest cocoa producer in the world

Federal Ministry of Agriculture and Rural Development | Annual Projected Increase of Supply of Cocoa Beans Measure: Thousands of Metric Tons

Demand and Supply Side Targets – Cocoa

Double Production in Four Years…then grow to over 1 Million Tons

42

Cocoa Supply Side Targets

• Globally there is strong and

growing demand for Cocoa, particularly in Asia, Eastern Europe and Latin America.

• Our strategy: Rapidly grow Nigeria‟s

production of cocoa beans:  Rehabilitating plantations  Raising productivity  Expanding into new areas  Newly released 8 new high yielding cocoa hybrids

Key Take Aways

Federal Ministry of Agriculture and Rural Development | 43

New High Yielding Cocoa Hybrids Developed by Nigerian Scientists Launches a Cocoa Revolution

Federal Ministry of Agriculture and Rural Development |

Released 8 New High Yielding, Fast Maturing Cocoa Hybrids to revolutionize Cocoa Sector Increased Yield (Kg/Ha) Faster Maturing (Years to Mature)

Federal Ministry of Agriculture and Rural Development | 45

• Establishment of Cocoa Market and

Trade Corporation

• Cocoa Investment Fund (across all

16 cocoa producing states)

• Financing the replanting of cocoa

plantations with new cocoa hybrids

• Target is for Nigeria to hit over one

million Metric tons of production in less than 10 years

• Local processing and value addition

in cocoa industry to drive growth

• Cocoa Transformation Action Plan

Federal Ministry of Agriculture and Rural Development | 46

Sorghum Transformation Plan

Driving economic development in the North East and North West  Nigeria is the largest producer of food sorghum in the world  While USA is the largest producer of feed sorghum in the world and makes money globally, Nigeria has not been able to unlock its market potential for food sorghum  New High Yielding Sorghum Hybrids opens up new

• pportunities all across the

states in the North of Nigeria.  Goal: Make Nigeria the largest processor of food sorghum in the world

Federal Ministry of Agriculture and Rural Development |

Food manufacturing and industrial use will drive sorghum value chains across Northern Nigeria

47

Fortified Foods Malt

• Sorghum will be utilized to produce nutritious fortified foods,

typically blended with soybeans.

• Key markets for these fortified foods:

 Home Grown School Feeding programs  Turn Nigeria into a major supplier of fortified foods for

food aid purchases for the region by World Food Program

 High Quality Sorghum Flour for composite flour with wheat

for bread in Northern Nigeria

 Establish large scale sorghum processing plants

• Sorghum will be used in producing malt for use in the

beverage industry (non-alcoholic beverages)

Federal Ministry of Agriculture and Rural Development |

Nigerian agriculture offers profitable returns on investments

Crop Modeled Investment Theme Start Up Capital (Fixed Assets) IRR Payback Period Tomato

• Tomato paste and related

products plant to replace imported Chinese paste

• $3.9M for plant with

15,000 tons/annum

20%

• ~ 4years

Cassava

• Cassava chips processing for

export to Northeast Asia

• $3.5M for plant with

115,000 tons/annum plant

19%

• 4.5 years

Cotton

• Cotton production and ginning

into lint for export and domestic markets

• $3.2M for a 30,000 ton

/annum ginnery

20%

• 3.5 years

Maize

• Processing into animal feed to

serve fast growing livestock market

• $3.5M for a 50,000

ton/annum plant

30%

• ~3.6 years

Rice

• Rice production and milling to

serve large domestic demand

• $6.1M on a 45,000

ton/annum rice mill

33%

• 3.5 years

Soya Beans

• Processing into animal feeds,

industrial supplements and oil for domestic markets

• $10M on a 100,000 ton

plant

106%

• 4.5 years

Source: Monitor Analysis; Interviews with Processors; NIRSAL Analysis

Federal Ministry of Agriculture and Rural Development | 49

Climate change could negatively affect Nigeria‟s food production

Impact of climate change on agricultural productivity without carbon fertilization; %

Source: CGD – Global Warming and Agriculture: New Country Estimates Show Developing Countries Face Declines in Agriculture Productivity n.a. Percent change decrease <–25 –25 to –15 –15 t –-5 –-5 to 0 0 to 5 Percent change increase 5 to 15 15 t 25 > 25

Federal Ministry of Agriculture and Rural Development |

Policies for climate change adaptation in Nigeria

• Liberalization of the agricultural insurance market to

allow private insurance companies

• Weather-indexed crop insurance
• Strategic grain reserves
• Expanded investment in irrigation
• Development of drought tolerant crops
• Improved access to climate and weather information

Federal Ministry of Agriculture and Rural Development |

Agricultural Transformation: Deliverables in four years

51

Jobs

• 3.5 Million jobs across all agricultural value chains

Wealth

• US$2 Billion in additional income in the hands of Nigerian farmers
• US$2.2 Billion injected into the economy from rice self sufficiency
• US$380 Million injected into the economy from substituting 40% of

bread wheat flour with cassava flour

Food Security

• Nigeria to be food secure by increasing production of key food staples

by 20 Million metric tons.

• Rice: 2 Million metric tons
• Cassava: 17 Million metric tons
• Sorghum: 1 Million metric tons

Federal Ministry of Agriculture and Rural Development | 52