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9/11/2018 What’s Tomato with You?

- The Business Year



After last year's pest damage, thousands of farmers in northern Nigeria are
not growing tomatoes this year, setting the country's tomato processing
ambitions back considerably. 1/5
9/11/2018 What’s Tomato with You? - The Business Year

A woman sells tomatoes at a roadside grocery stall in Nigeria's central city of Jos.

The common Westerner is often surprised to learn about Nigeria's tomato export ambitions. Just
as the likes of Ghana and Cote d'Ivoire are famous for their cocoa beans, and Zambia and South
Africa for their livestock, Nigeria is hoping to become known internationally as a tomato

Tomatoes are the world's most plentiful fruit, with more than 130 million tons produced every
year, mainly in China, India, the US, the EU, and Turkey. These ve entities combined account
for 70% of global production

Nigeria's annual tomato harvest is estimated to total at around 1.5 million tons, 900,000 of
which rot as waste each year. The quantity alone is enough to meet the import demand of
Sweden (80,000 tons), Denmark (39,391 tons), and Norway (23,980) six times over.

Agriculture, as a sector that employs over 70% of Nigerians yet represents less than 22% of GDP,
is often described as the country's new oil, in reference to the economic potential of the sector.
With the capacity to defeat the four horcruxes of Nigeria's economy, namely underdevelopment
of the agriculture in the north, rising unemployment, the growing appetite of a fast-growing
population, and a signi cant cut in the country's import bill, agriculture could solve many

Even with 900,000 tons of wasted tomatoes each year, the country still imports around USD2
billion worth of agricultural goods each year. And even though the country produces 65% of
West Africa's tomatoes, it is also the largest importer of tomato paste in the world. 2/5
9/11/2018 What’s Tomato with You? - The Business Year

In addition, the segment has been recently suffering from another dose of bad luck in the form
of the tuta absoluta moth. Native to South America, the moth eats the entire tomato plant and
can destroy the whole crop in a matter of weeks. In 2016 of cials estimated that up to 80% of
tomato farms had suffered from moth infestation, leading to a 400% price increase. People
ended up paying around NGN1,880 for four tomatoes, when the previous year the same pack
would have cost just NGN300.

This put a huge strain on tomato processors in the

country. Chief Eric Umeo a, CEO of Erisco Foods,
aside from being well-known for his tomato-
themed printed shirts, operates the fourth-largest
tomato processing plant in Nigeria. In a 2016 TBY
interview, he explained how the plant was capable
of producing 450,000 metric tons of tomato paste
and ketchup a year, but due to the moth
infestation was operating at less than 20%

This year, after suffering from such poor returns on

the little red fruit, thousands of farmers are wary of planting the crop. Aliko Dangote's company,
Dangote Farm Ltd, which has the capacity to produce 400,000 tons of paste annually and handle
1,200 metric tons of tomatoes each day, is feeling the effects.

Around 8,000 farmers in the Kadawa Valley, near Kano, had signed up to supply the factory, and
as such were guaranteed a price of USD700 per ton, a substantial amount considering the
average return of USD350 on the domestic market. This is still not enough to tempt farmers,
who simply are not planting the crop.

The factory had started operations in March 2016, but closed a month later when the rst wave
of moths hit. Since then it has opened and operated in ts and starts.

The government attempted to help and in March 2017 raised tariffs on tomato concentrate
imports from 5% to 50%, putting in place an additional levy of USD1,500 per metric ton. They
also totally banned the importation of tomato paste and powder in a last-ditch attempt to revive
the sector and help the industrialists who had heeded the Central Bank and government's call to
build the country's tomato processing industry.

The legislation attempted to help the whole chain, classifying greenhouse equipment as
agricultural equipment so it would fall into the zero percent import duty bracket. The value of
imported tomato paste in Nigeria is estimated to be USD170 million, with a further USD50
million spent on tomato concentrate. 3/5
9/11/2018 What’s Tomato with You? - The Business Year

Almost as soon as the government began

supporting agricultural self-suf ciency, embracing
policies that not only work toward greater food
security but toward developing the war-torn north
of the country, the moths began to wreak havoc.

With few effective insurance schemes for farmers

in Nigeria, and even less access to cheap nance
for fertilizers and pesticides, it will take time and
trust to coax farmers back to the crop, and
hopefully more initiatives to support the rst link
in the chain.



Barn Raising

TBY talks to Dr. Akinwumi Adesina, Hon. Minister of Agriculture and Rural
Development, on job creation, private investment, and facilitating lending to

read article 

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