How Nigeria can generate $300m from shea nuts

By Vincent A. Yusuf (Abuja) & Abubakar Akote (Minna) Nigeria is the largest producer of shea butter in the world, with an annual production of 500,000 metric tonnes. The global shea butter market, which is growing rapidly, is estimated at $5 billion by the end of this year. Nigerian shea nuts are highly sought after […]

By Vincent A. Yusuf (Abuja) & Abubakar Akote (Minna)

Nigeria is the largest producer of shea butter in the world, with an annual production of 500,000 metric tonnes.

The global shea butter market, which is growing rapidly, is estimated at $5 billion by the end of this year.

Nigerian shea nuts are highly sought after globally, particularly in cosmetics and food. Major importers include the US, UK, Germany, Japan and eastern Europe, notably Poland and Russia, which are growing markets.

Shea butter is used for chocolate, pastries and confections (as an alternative to cocoa butter), body creams and cosmetics, soaps, margarine, baking fat, cooking oil and candies, in addition to being a component of numerous pharmaceutical medications.

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Shea trees grow naturally across Kwara, Niger, Kebbi, Kaduna, Kogi, Benue, Adamawa, Borno, Kaduna, Sokoto, Taraba, Ogun and Oyo states.

Although the country produces nearly 45 per cent of the global shea nut, it accounts for only 1 per cent of the market share of over $5 billion.

To address this imbalance, the federal government has been compelled to intervene to safeguard the domestic industry and increase the country’s advantages.

A few days ago, the federal government approved a six-month temporary ban on the export of raw shea nuts to curb informal trade, boost local processing, protect and grow Nigeria’s shea industry.

The ban, which is with immediate effect, is subject to review on expiration and specifically aimed at boosting Nigeria’s shea value chain to generate about $300 million annually in the short term.

Vice President Kashim Shettima, who announced the president’s directive on Tuesday, said the current situation is “unacceptable,” adding, “We are projected to earn about $300 million annually in the short term, and by 2027, there will be a 10-fold increase. This is our target.”

To make shea butter, which is highly sought after worldwide, shea kernels are utilised. After the butter is extracted, shea nut cake is produced, and is being utilised more and more as animal and poultry feed.

 

Going beyond ban

While stakeholders applauded the federal government for taking what they described as a “bold step” towards empowering the populace in the shea nut production sector, they said much needed to be done to process the shea nut so that it could meet the international market standards.

Ibrahim Akibu of the Regional Centre of Expertise, one of the stakeholders in the training of shea nut processors in Niger State, said unless the federal government backs the ban with a policy direction and provides necessary support to shea farmers, collectors and processors, the decision would not bring about any positive outcome.

“Our local processors need to be trained on international best practices to yield the desired results because it is not just about processing and export; there are high standards attached to some of these things, and international standards must be adhered to. And because our people don’t understand this, they would pack the raw nuts and sell them to our counterparts in Ghana, who understand these standards and follow them in processing it and adding value and exporting it to the world.

“We need to aggregate farmers and train them on best practices and provide them with the necessary machines or tools to be able to process better to the international standards. That is one key thing. Most of our farmers collect the raw shea nuts and sell them to Ghana because they know that if they process them, they won’t sell at the global market. And Niger State needs to be at the forefront because we have the largest deposit of shea trees in Nigeria and even on the African continent.

“If it is just a ban without any policy direction and support to the local shea farmers or collectors, this ban will not add any value. When it goes beyond the six-month ban with policy direction and support to local farmers and processors as well, there are more shea trees being planted and domesticated in our communities. That will help us a lot.

 

Nigeria can get more than $300m if…

Mr Shuabu Sani has been in the business of buying shea across Nasarawa, Kogi, and Benue states. He said Nigeria could generate more because the value chain products globally are very expensive.

“Go and price good, important shea butter cream and see how much it will cost you. Shea products are adjudged to be lucrative because they can be used to produce several products,” he said.

He said if the federal government is really serious about it and organises the production and value chain, it generates huge income for farmers and the country as a whole, adding that “unless that is done, it will just come nothing.”

Ibrahim Akibu told our correspondent in Minna that currently, “our local farmers in villages sell raw shea to buyers who usually penetrate our communities at giveaway prices because they don’t even know the value.”

He added, “One of the most important agricultural activities in Niger State is shea-nut collection, processing and marketing. But most of these collectors and processors are from poor households and are widely distributed in almost all the local government areas of the state. Notwithstanding the large number of people engaged in shea nut collection, processing and marketing in the state, the present economic gains from these activities appear to be marginal compared to the potential. There is high demand for shea butter in domestic and international markets, but this has not translated into adequately remunerative profits for producers in the state. This is largely due to low quality of shea butter obtained through the identified traditional methods of collection, processing and storage.”

Also speaking with Weekend Trust, Mohammed Abdulkadir, an engineer, the officer in charge of the Shea Tree Research Substation of the Nigerian Institute for Oil-Palm Research (NIFOR), Bida, Niger State, said there was need to improve on micro and macro processing.

“The order is a welcome decision, and kudos to this laudable initiative. But the government needs to support research findings and micro and macro processors to produce shea butter that meets international standards.

“Also, the government must empower research institutes on training and provision of small and medium shea processing equipment,” he said.

 

Absence of industrial plant  a problem

The chief executive officer of NEXIM Bank, Abba Bello, a few days ago revealed that Nigeria produced 60 per cent of shea nuts globally but lacked industrial plants for quality processing.

He said the existing manual processing, mostly done by women in rural areas, did not meet global standards.

Bello said this while speaking at the inauguration of a shea butter processing plant established by Salid Agriculture Nigeria Limited, with support from NEXIM Bank in Kudu community, Mokwa Local Government Area of Niger State

He said that NEXIM Bank would continue to collaborate with the Salid Plant and the Niger State Government to achieve the whole value chain of shea nuts.

Following the inauguration of the processing plant, the Niger State governor, Mohammed Umaru, said the state government would plant 10 million shea trees to boost production of shea butter in the state.

Bago said the idea was to create employment for the teeming youths and women, as well as improve socioeconomic activities in the state and strengthen its status as the headquarters of shea trees.

He said 10,000 hectares of land would be prepared to plant the 10 million shea trees to feed the processing company and attract more investors to the state.

The chief executive officer of Salid Agriculture Nigeria Ltd, Ali Saidu, said the Salid Shea Butter Processing Plant in Kudu had the capacity to produce 30,000 metric tonnes of shea butter annually, and would increase capacity utilisation and enhance the quality of shea butter production in Niger State to compete with the global market.

The Niger State Commissioner for Investment and Trade, Aminu Takuma, said the establishment of the shea plant was a journey towards agricultural and industrial transformation.

The executive director of the Salid shea butter processing plant, Daniel Alabi, said the processing plant was born out of the desire to harness the abundant agricultural potentials of the state and empower local communities and contribute meaningfully to the economic advancement of the country.

The Salid shea butter processing plant in Kudu, Mokwa Local Government, is estimated to produce 100 metric tonnes of shea butter per day and projected to produce 30,000 metric tonnes annually.

 

Without shea policy framework, nothing will change

Stakeholders lamented that the lack of a workable policy would be a major issue that would frustrate shea butter processing and production in the country.

They said hundreds of shea trees were being cut on a daily basis for charcoal, timber and firewood in the state without afforestation.

In Nasarawa, Benue and Kogi states, shea trees have become endangered species because producers of mortars target them in the wild.

Niger State is estimated to have the largest collection of shea trees in the world, controlling about 54 per cent of all the trees in Nigeria and of the vaunted 325,000 metric tonnes of shea nut and butter exported from Nigeria.

 

Shea tree lifespan

It takes an estimated 11 to 15 years for a tree to reach fruit-bearing age, after which it can continue to bear fruit for up to 200 years. Each tree can produce roughly 15 kilogrammes of fruit. Turning the nuts or kernels from the shea butter tree’s fruits into butter is one of the finest ways to get the most out of it.