Marketing Palm Nuts from Benin to Nigeria -Experiences of the Communal Union of Producers of Ifangni And Comfort Vegetable Oil Ltd. In Nigeria
Abstract
The growing demand from the Nigerian agro-processing industry for palm oil presents a significant opportunity for palm oil producers and processors in Benin. This publication explores how members of the Communal Union of Producers (UCP) of Ifangni in Benin have been marketing palm nuts, which are a byproduct of palm oil extraction, to Nigeria. In particular, palm nut kernel has emerged as an alternative marketing opportunity.
Comfort Vegetable Oil Ltd., a Nigerian family business specializing in palm nut, palm oil, and soybean oil refinery, has been sourcing raw materials from Benin to meet the needs of numerous vegetable oil refineries in Ogun and Oyo States in Nigeria. While Comfort Vegetable Oil Ltd. operates a processing plant in Ogun State, Nigeria, the current supply constraints have led to the exploration of more direct connections with Beninese producers to reduce production costs and ensure a sustainable source of raw material supply.
To address these challenges and facilitate a business relationship, the Ifangni UCP in Benin and Comfort Vegetable Oil Ltd. in Nigeria conducted a pilot experiment on the marketing of palm nut kernel, facilitated by the Communal Approach to the Agricultural Market (ACMA) program. ACMA uses multi-stakeholder consultations within agricultural business clusters (ABCs) to connect producers, processors, traders, and service providers with buyers in Nigeria, fostering a competitive supply of agricultural products. Through negotiations and practical solutions, this experiment aimed to identify marketing constraints and establish a sustainable supply chain for palm nut kernel to meet the demands of Nigerian agro-processors.
The study discusses the negotiation process, the challenges posed by fluctuations in the exchange rate of the Nigerian Naira, and the strategies adopted to create a successful business relationship. The findings shed light on the importance of improving the competitiveness of small and medium-sized enterprises in the Nigerian agro-processing industry and the potential benefits of direct producer-buyer relationships.
Description
Keywords
Palm oils, Agricultural sector