(Ecofin Agency) - In Nigeria, the cocoa processing sector suffocates, caught between the depreciation of the naira and the rising prices of brown gold. Taiwo Ayoade, CEO of Plantation Industries Ltd, provides an overview of the situation to Reuters. “There are three factories at Akure, but the only one still operational today is ours, which works only at 50% of its capacities. If this goes on, in the next two or three weeks we could close”, said the one whose unit can process up to 25,000 tons at full beans.

Now processors are forced to pay between N750, 000 and N780, 000 to producers for one ton of beans against N520, 000 a year ago. The soaring of the price of beans goes with that recorded on the world market where the price per ton rose to its highest level since March 2011, as a result of the Ivorian crisis.

In addition, facing the crisis that knows the petroleum sector, the Central Bank of Nigeria has decided to restrict access to foreign currency. This has affected processors who “are forced to buy foreign currency on the black market to buy beans intended for grinding while exports of processed products, butter and powder, are paid at the official rate, which does not compensate for weak naira,” said the leader.

Last but not the least difficulty, exported cocoa-based Nigerian products are taxed upon entry into the European market while the raw beans are exempt from taxes. A situation which of course, does not encourage local processing of brown gold.

Aaron Akinocho