How to establish multipurpose cassava processing plant
A critical analysis of the present economic situation in Nigeria will reveal a myriads of problems ranging from unemployment, hunger, mass poverty, rural degeneration, urban explosion, increased social vices, gradual extinction of the productive sector and a host of others. The major cause of this problem is the total abandonment of the productive sector.
It has been said that Nigeria is suffering from resource curse. One of the solutions to the above listed problems is the encouragement of investment in the productive sector. This write-up is a step in that direction.
Investment justification
Nigeria is one of the largest producers of cassava in the world with annual production of over 40 million metric tons. Establishment of multipurpose cassava processing centers will no doubt enjoy good supply of raw materials. Currently, there is glut is cassava production in Nigeria simply because of absence of adequate processing of the crop into many products. Establishment of this product will definitely solve this problem. It will at the end of the day encourage farmers to cultivate more since they now have ready-made market for their crops: The implication of this is that there will be increased farm activities.
Very recently, the Federal Government passed into law that 10 percent of composite flour used by bakers should be made of cassava. By this, the implication is that the demand for cassava flour in Nigeria is now in thousands of tons annually. This is to say in essence that the proposed project is bound to enjoy tremendous patronage.
There is bound to be constant demand for the products of this factory as it is multifarious in nature. Since there would be more than 3 products from the factory, we are sure of getting regular demand for any of the products daily.
Social and Economic benefits derivable from the project among others are employment generation, poverty alleviation, improved rural income, diversification of the economic base and optimal utilization of resources.
Technical information
Establishment of multipurpose cassava processing center will entail procurement and installation of machines that will be able to produce cassava flour, cassava chips, starch, fufu powder and garri. Cassava chips can be sold to both local and international markets, starch can be sold to textile industries and other users of starch.
Fufu powder and Garri are consumed locally and internationally as main source of energy providing food by Nigerians in particular and Africans in general.
Flour is also consumed by human beings or can be supplied to industries that utilize them to make biscuits and bread. Federal, states and local Governments can establish cassava processing centers to create jobs and provide food for the masses. Production process involves chipping, milling rasping, dewatering, sieving, frying, drying and packaging. Each product has its own production process to follow.
Implementation procedure includes pre-investment activities, procurement of accommodation, installation of plant and machineries recruitment and training of personnel, test running of equipment and commercial take-off.
Genuine and serious minded investors can be assisted in the establishment of this project including supply of reliable and guaranteed processing machines and assistance in the marketing of the products.
Financial implication
A sum of N11, 750,000 will be required to establish the project. This is broken down as follows:
N
Pre-Investments 500,000
Accommodation (factory building) 3,500,000 (30 x 50ft)
Plant and Machinery 5,000,000
Utilities (Generator 1, 750,000 (30kva)
Working capital 1,000,000
Total N11, 750,000 =========
Profitability analysis
The following profitability indicators have been computed:
Annual turnover: N95 million
Payback period: One year
Annual Profit after tax: N45 million
% Return on Investment: Over 300 percent
This is no doubt a good source of livelihood for Nigerians and forward-looking investors.
OLUMAKINDE ONI