How to reverse 350m litres annual ethanol imports — Report
Insights from the Nigeria Cassava Investment Accelerator (NCIA), an initiative of Lagos Business School Pan-Atlantic University, have outlined a clear pathway for Nigeria to reverse its estimated 300–350 million litres of annual ethanol imports by leveraging its vast cassava resources and strengthening agro-industrial systems. According to NCIA findings, Nigeria’s ethanol demand stood at about 400 […]
Insights from the Nigeria Cassava Investment Accelerator (NCIA), an initiative of Lagos Business School Pan-Atlantic University, have outlined a clear pathway for Nigeria to reverse its estimated 300–350 million litres of annual ethanol imports by leveraging its vast cassava resources and strengthening agro-industrial systems.
According to NCIA findings, Nigeria’s ethanol demand stood at about 400 million litres in 2024, with roughly three-quarters supplied through imports despite the country producing over 60 million tonnes of cassava annually, based on data from the National Agricultural Extension and Research Liaison Services.
The report emphasised that the first step toward import substitution is organising reliable cassava supply chains. Industrial ethanol production requires consistent volumes of cassava delivered to specification—something the current spot-market system cannot guarantee.
NCIA recommended the development of structured outgrower networks, aggregation centres, and coordinated logistics systems. These would ensure steady year-round supply through staggered planting across Nigeria’s multiple agroecological zones.
To replace imports, NCIA estimated that Nigeria would need to process about 1.8 to 2.0 million tonnes of cassava annually, which is just around three percent of national output, into ethanol.
However, achieving this requires significant investment in processing infrastructure. Unlike sugarcane molasses, cassava must undergo starch extraction and enzymatic conversion before fermentation, making production more capital-intensive.
The report stressed that plants must operate at high utilisation rates to remain profitable, with efficiency in energy use and conversion processes being critical to cost competitiveness.
NCIA highlighted existing industry moves as proof of viability. Nosak Group is expanding its cassava-to-ethanol operations through integrated farming and processing, including outgrower schemes and new facilities.
Such investments, the report notes, demonstrate that securing local feedstock can reduce exposure to foreign exchange volatility and import disruptions.
Another key recommendation is aligning production with specific market segments. Ethanol demand in Nigeria spans beverages, pharmaceuticals, cosmetics, and potentially fuel blending.
Each segment has strict quality and certification requirements. NCIA advises operators to define target markets early and design production systems that meet those standards, ensuring consistent offtake and pricing stability.
The report also underscored the importance of improving project economics through by-products. Fermentation residues can be processed into animal feed, while captured carbon dioxide can be sold for beverage production.
These additional revenue streams can significantly enhance the financial viability of ethanol plants.
NCIA noted that scaling domestic ethanol production will require supportive policy frameworks, including incentives for agro-processing, infrastructure development, and access to long-term financing tailored to industrial agriculture.
Clear policies around fuel ethanol blending could also stimulate additional demand and encourage investment in large-scale production.
NCIA added that Nigeria’s reliance on imported ethanol is not due to lack of raw materials but weak industrial coordination. With the right systems in place, a small fraction of cassava output could meet a significant share of national ethanol demand.
The report frames the opportunity as a shift from agricultural abundance to industrial capability—one that could reduce import dependence, stabilise supply, and boost rural incomes across the value chain.