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How To Start Cocoa Production Business In Nigeria

Cocoa Production

Cocoa production is one of the oldest agricultural businesses in the world. It’s a profitable business with the potential to generate income in different ways. More so, it was one of the main foreign exchange products in the Nigerian economy before the oil boom.

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Despite the oil boom, the demand for cocoa remains high in the global market. This is because it is an essential ingredient for chocolate and other beverages.

Start Your Business in 30 Days Even If You Don't Have An Idea
Start Your Business in 30 Days Even If You Don’t Have An Idea

A cocoa tree produces cocoa fruit (cocoa pods) from which cocoa seeds are gotten (cocoa beans). These beans are thereafter processed into cocoa liquor, cocoa butter, cocoa powder, and most popularly, chocolate. In other words, the seed is the goldmine of the cocoa plant.

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Cocoa production business provides sources of income to 40-50 million farmers, rural workers, and their families in the global South; and for over 90% of farmers in the Ivory Coast and Ghana. Also,70% of the world’s cocoa beans come from West African countries; Ivory Coast, Ghana, Nigeria, and Cameroon.

Altogether, cocoa production is a lucrative business that can serve you for the rest of your life if well managed. In this article, I will take you through every step you need to take to venture in and succeed in the cocoa business.

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Cocoa Production In Nigeria

Cocoa also known as cocoa bean is a dried and fully fermented seed of theobroma cacao from which cocoa solids and cocoa butter are extracted. It is a perennial crop of about 4-8m tall that primarily comes from three tropical regions – West Africa, Southeast Asia and Latin America with Cote d’Ivoire being the single largest producer.

Cocoa is a highly concentrated food providing about 1000 calories per kilogram. It has high nutrient content; about 40% carbohydrates, 40% fat, and 20% protein. Also, it serves as a good source of potassium, magnesium, and iron, and over 7 million tons are consumed in a year.

A cocoa pod contains about 30 – 40 seeds each of which is surrounded by a bitter-sweet white pulp. Then, after it is dried and fermented in the sun, it turns brownish red and then called cocoa bean.

The bean is now used for chocolate, sweets, desserts, medicine, herbs, beverage, drink e.t.c The crushed shells or the pod husks of the cocoa bean are used as a cost-effective, organic fertilizer to help in suppressing weeds, conserving moisture, and minimizing erosion.

Basically, Nigeria is the third largest producer of this product in West Africa. The cultivation is done by many small scale farmers on a farmland of about 2 hectares. It is majorly produced in states like Ondo, Akwa Ibom, Ogun, Cross River, Ekiti, Oyo, Osun, Delta and Edo.

Generally, it is a lucrative venture which requires only a single substantial investment and can serve the owner as long as he lives.

Before you fully begin, there are some basic steps you need to take, which I will highlight in the following paragraphs.

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Planning

Every business requires planning; planning for fund, location, creating a vision, human resource, pricing, marketing, e.t.c. If all of these are not settled, it can result in failure. Therefore, it is important to start a cocoa production business by writing a business plan.  

A business plan is a document that contains your business goals, aims, and objectives and how they can be attained. Also, it gives full information about the business and provides direction to achieve the vision.

Go from idea to starting your business in 30 days
Go from idea to starting your business in 30 days

For a cocoa production business, your business plan can have the following outline.

  • Executive Summary
  • Product and Pricing
  • Competitors
  • SWOT Analysis
  • Market Research/Strategy
  • Financial Projection

Having a business plan will give you the opportunity to access a bank loan and other financings i.e grant, angel investors, crowdfunding, e.t.c  

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Register

Once the business plan is ready, the next thing is to proceed to register the business with the Corporate Affairs Commission (CAC). You can register as a sole proprietor or a limited liability company.

To do this, you can register online via the CAC company online registration portal or reach out to companies like ReDahlia. ReDahlia makes business registration seamless and gives businesses global visibility.

Thereafter, ensure to pay tax to the appropriate authority and join cocoa producers association for proper regulation.

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Capital

Cocoa production business requires a huge amount of money to start. This capital will cover land acquisition, seed purchase, pest control, equipment, harvesting, store set-up, e.t.c.

This is why having a well-written business plan is important. With a business plan, you can approach banks for a loan. Also, you can reach out to friends and families, cooperative societies, angel investors or perhaps speak with persons interested in the business and possibly team up as partners.

Most importantly, as soon as you begin, ensure to set aside some funds for labour, pesticide and other expenses until harvest.

Without much ado, let’s go through the step by step plan on the cocoa production process.

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Step By Step Plan On Cocoa Production

Choose A Land

Forest lands are the best places for a cocoa plantation. This is because the lands are usually covered by rain forest canopy and cocoa is adapted to growing under such a dense rainforest canopy. Besides, it may be cultivated under shaded conditions, e.g Agroforestry.

They grow on land with regular rainfall, water source, and moderate temperature like 30 – 32°C (max) and 18-21°C(min). Also, the cocoa plant is very sensitive to water deficiency in the soil. Therefore, it should be grown on land with no less than 1000 – 25000mm of rainfall in a year. If they are not grown and nurtured in this kind of environment, they are not likely to develop well.

They require a relatively hot and humid atmosphere as much as 100% in the day and about 70% to 80% at night. Hence, you need a large expanse of land that fulfills this condition.

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Prepare The Soil

Cocoa plant requires a deep, relatively damp soil with the right quality and quantity of nutrients. The soil quality will help the trees grow as intended by nature. One of the ways to ensure this is to have good drainage as well as water retention properties.

Also, the layer of soil should be at least 1.5 meters deep with coarse elements. Also, it should be able to absorb nutrients and must be rich in organic matter of at least 3.5%.

Cocoa is tolerant of acid soils as long as the nutrient content is high enough. This kind of soil makes cocoa trees grow an expansive root system which is beneficial during harvest. Also, it will prolong the lifetime of the trees themselves.

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Decide On The Type of Plant To Grow

There are three main varieties of cocoa seeds that can be grown; the Forastero, Criollo, and Trinitario. Each of these plants has its own pros and cons;

Forastero Cocoa

This is the most used cocoa variety anywhere in the world making up about 80% to 90% of the world’s cocoa production. Over time, it has become a reliable choice that possesses a pleasantly bitter taste. Also, it yields extremely rich harvests.

Criollo Cocoa

Criollo cocoa is the finest and rarest type of cocoa beans. The yield is lower compared to the Forastero cocoa. Growing it can be demanding and tiresome. As a result, it’s not popularly grown in Nigeria. This is because it is less resistant to cocoa plant diseases.

Its products during harvest are usually smaller compared to other kinds of cocoa. But, it sells faster and at higher prices than other cocoa types.

Trinitario Cocoa

This is a hybrid of Forastero and Criollo cocoa type. The aim is to incorporate the harvesting potential of Forastero and the trademarked aroma of Criollo. It is considered to be of much higher quality than Forastero, with higher yields, and more resistant to disease than Criollo.

You can reach out to an agricultural expert to guide you on the best kind of cocoa seed that best fits the land where it would be planted.

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Plant The Seed

Once the seed has been chosen, the next is to plant. For cocoa, the best time for planting is at the beginning of the rainy season between April to May.

To this effect, there are different processes of planting a cocoa seed. It can be done through seeding, budding, cutting and marcotting;

Seeding

This is the process of growing trees from seeds. After about 15 days of yielding, seeds are taken out of the bean pods and planted into the ground.

Budding

This is an uncommon method of planting cocoa but it is also used. First, cocoa buds are plucked from the grown tree and placed under another tree. Then once the new tree begins to develop, the old one can be cut off and the new tree left to grow.

In this situation, the budding patch should be waxed to prevent moisture loss.

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Cutting

This method requires plant cutting with 2-5 leaves and 1-2 buds to grow cocoa. Then, the leave will be sliced, and the cuttings are placed into a prepared pot with polythene.

As soon as the tree roots begin to grow from the pot, it can be transferred to the plantation.

Marcotting

In marcotting, a strip of bark is removed from the branch and the area covered in sawdust and a polythene bag. As soon as the covered area begins to grow, the branched cut will be planted.

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Maintain The Plant

Cocoa is prone to disease and as such requires care and the use of chemicals to keep the pest and diseases at bay once it has been planted.

Just like every food crop has peculiar pests and diseases that infect them, cocoa plant is not excepted. Some of the cocoa plant diseases are; the black pod disease (a most serious disease in W/Africa), cherelle wilt, and charcoal rot. The pests are; cocoa mirids, mealybug, cocoa pod borer, and frosty pod rot.  

Therefore, once the seed has been planted, routine maintenance must be done for maximum productivity. Weeding, pruning, replacement of dead seedlings, and regeneration of the old cocoa plant should be done.

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Harvesting

After about 4-5 years of manual work and labour, cocoa plantation must have been matured, and can be harvested. This harvesting can take place for years with bulk of fruits coming out in October to February and May to August every year.

First, the ripe seed pods are cut from the trees with cutlass or sticks, then split open with a machete to extract the valuable cocoa beans. However, these beans usually have a strong bitter taste, therefore must be fermented.

Fermentation takes about 4- 5 days to develop the sweet flavour. Thereafter, cocoa beans are dried, cleaned and packaged for sales.

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Uses Of Cocoa

After harvesting, cocoa seeds are packaged, then exported. The importers then roast the seeds and turn it into other products fit for use.

Some of these products are:

Cocoa Butter: A creamy-colored edible vegetable fat with cocoa flavour and aroma extracted from the beans. It makes up more than 50 percent of the weight of cocoa beans and it’s used for chocolate, ointments, moisturizing creams and soaps, toiletries, and pharmaceutical products.

Cocoa Liquor: This is used with other ingredients to produce chocolate. The chocolate can be used as a product on its own or combined with other ingredients to form confectionery products.

Cocoa Powder: Cocoa powder is used as an ingredient for foodstuff such as chocolate flavoured drinks, chocolate flavoured desserts, etc.

In addition, husks of the cocoa pods and the pulp, or sweatings, surrounding the beans are used for the following;

  • For feeding animals
  • For producing soft drinks and alcohol.
  • Fertilizer for cocoa, vegetable and food crops. e.t.c

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Marketing

As long as you can produce cocoa beans, selling is never a challenge. This is because there are several intermediaries who can manage your sales while you concentrate on production. They can be cooperative or licensed buying cocoa agents who deal in selling cocoa to exporting firms.

These intermediaries buy the sacks of unprocessed beans and sell them to exporters who then process it. They crush the bean to remove shells, roast, ground and then turn it into finished products.

So, all you need is to reach out to these intermediaries and they will sell your product for you.

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Conclusion

Cocoa production business requires tenacity and years of labour before you can begin to enjoy the benefits. Fortunately, once you labour and endure the waiting period, you are sure of reaping the harvest as long as possible. This is because a plantation can produce more than ten bags and this can be twice in a year.

Besides, it’s a product with global demand. As long as you can commit yourself to it, your profit is sure.

Are you thinking of starting a cocoa business or you have a cocoa plantation? Let’s read your thoughts in the comment.

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4 thoughts on “How To Start Cocoa Production Business In Nigeria”

  1. Good day, is there an institute or proffessional where cocoa production & processing is taught as a full time programe within Nigeria or in Africa ?

  2. Abdullahi Abdulazeez Olamilekan

    I already have a cocoa plantation that is matured already… How can I get a trusted exporter of my cocoa to other countries and company to sell to with trusted guarantee
    And lastly
    What document is needed to sell cocoa
    (profile)

  3. Hamadtijani Abdulwasih Olateju

    Without being a grower in which other aspects of the Cocoa business value chain can an entrepreneur participate.

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