Nigeria losses N72bn oil palm revenue over non-utilization of nine million seedlings

Practitioners in the Oil Palm space have said that between 2015 and mid 2016 Nigeria may have lost about N72 billion in revenues following the failure of palm oil producing states to successfully embrace the oil palm value chain of the President Goodluck Jonathan led administration’s Agricultural Transformation Agenda.

Omorefe Asemota, Executive Director, Nigerian Institute for Oil Palm made the disclosure in an address presented during a workshop for Oil Palm Seed Growers, Research Extension Farmers Inputs Linkages System (REFILS) and the Institute’s In-House Review in Benin-City on Monday.

Part of the plan was for Nigerian Institute for Oil Palm Research (NIFOR) to raise nine million seedlings for farmers in the sub sector to access and cultivate. Nigeria oil palm belt covers 24 states with the nine Niger Delta states be the major producers.

Nigeria oil palm industry had in between 1950s to the mid-1960s remained the largest producer of crude oil palm world over, and had a market share of 43 percent , supplying 645,000 metric tonnes of palm oil on annual basis across the globe.

With the new improved varieties seedlings from the institute oil palm maturity period now commences from three years.

Asemotawho said under the  Agricultural Transformation Agenda programme, NIFOR was between 2012 and 2014 mandated to raise nine million palm oil seedlings noted that all the seedlings were however not planted by states, estates and other beneficiaries or their agents.

The theme of the workshop was, “Research and Extension : A Panacea for Food Security,  Women and Youth Empowerment Generation and Wealth Creation”.

He added that the successful cultivation of the seedlings would have added an average of over 62,000 hectares of improved planting materials to the national oil palm holdings.

He opined that the 62,000 hectares, though small by the standards of  Asian countries is worth over N38 billion in yearly revenue at maturity.

The NIFOR boss also opined that any state that provides 50,000 hectares and ensures that the land was adequately cultivated with improved seedlings that the institutes currently distributes has the propensity to generate an annual income of well over N30 billion at maturity.

He pointed out that 50,000 hectares is a fraction of a local government area and that the investment will resulted in the generation of more direct jobs in inputs supplies, marketing and other downstream activities for its citizens.

“As part of the erstwhile Agricultural Transformation Agenda, the oil palm chain was graciously selected by the Federal Ministry of Agriculture and Rural Development for support. Under the programme NIFOR was charged with the supply of nine million sprouted seeds between 2012 and 2014.

“We are pleased to say that the institute completed the production of the entire consignment of nine million. If all the seedlings were planted in the field by states, estates and other beneficiaries or their agents,  over  62,000 hectares of improved planting materials would have been added to the national oil palm holdings. Although small by the standards of Asian countries , 62,000  hectares is worth over N38 billion in yearly revenue at maturity.

“Any state that provides 50,000 hectares and ensures that the land gets planted and improved seedlings that NIFOR currently distributes, has an investment that at maturity, at current prices of a yearly palm oil income of well over N30 billion”, he stated.

Asemota assured that there are enormous opportunities for investment and economic activities embedded the oil palm value chain.

While noting that NIFOR will continue to work hard to provide the research support for crops like coconut palm, date palm, Raphia palm, Shea and other commodities, he also assured  that the  institute will also continue to develop new and improved planting materials.

Other areas to develop are agronomic packages for best practices as well as technologies for processing for all the commodities.

Asemota who appealed to the federal government for adequate funding to accomplish myriads of challenges in the interest of the country and to return the institute to a centre of excellence, however commended the Central Bank of Nigeria initiatives of “Anchor Borrower” and “Commercial Agriculture” which provide funds at 9 percent interest rate.

He however urged CBN to further reduce the interest rate  and with a generous moratorium period for oil palm farmers due to its nature as a tree crop.

He therefore expressed confidence that Nigeria will again becomes a more significant global player in palm oil by eliminating deficit and re-entering exports.

The NIFOR executive director, however advocated for the discouragement of import tariff waivers while backward integration should be vigorously encouraged.