Groundnut {peanuts} is an essential food product that enjoys good patronage in both the domestic and the international market. It is a veritable source of edible oil, animal feed and also consumed as snacks.
Groundnut “Arachis hypogaea” is a species in the legume “bean” family. The cultivated peanut was probably first domesticated in the valleys of Peru. Records have it that groundnut was first introduced in Nigeria in the early 16th Century.
In the period between 1956 and 1967, groundnuts including its cake and oil, accounted for about 70 per cent of Nigeria’s total export earnings and created the legendary groundnut pyramids which dotted the landscape of Kano. Today, no thanks to the discovery of oil and the lack of political will to develop the agricultural sector in Nigeria, not only has the pyramids disappeared but Nigeria has also lost a place in the world market as a leading exporter of cash crops.
At 1.55 million tons in 2008/2009 crop season, Nigeria currently occupies the fourth position in the world production of groundnuts and interested investor can take advantage of these by trading and processing of the product.
A resumption to the vibrant groundnut producing era would no doubt help to conserve some of the scare foreign reserve being used for the importation of crude edible oil, it would also help to generate employment opportunities. Some of the areas investors can engage the market includes
TRADING
DECORTICATING
MILLING
The trade in edible groundnuts, also known as HPS {Hand-Picked – Selected} is a good business despite the fact that the investor stands to gain more from the processing of the product. Groundnuts are exported as raw decants, shelled or raw peanuts, in-shell and processed peanuts though the convenient way to export is raw, in –shell. While the local price of groundnut currently stands at between N 50,000 – N 70,000 per ton, the international price is about $ 1200 / ton FOB.
The investor can choose to add value to the product by decorticating it before selling to the local and international market with more emphasis on the local market.
A decorticator is a machine for stripping the shell {husk} in order to free the seeds in preparation for further processing. The processing technology is relatively simple and involves the following: sorting, decorticating and packing. The product produced can be packaged and sold to local oil mills or food vendors scattered in different parts of the country.
The processing of groundnuts to yield edible oil is perhaps the best area the investor can engage in with maximum utilization of the product. The milling of the product would yield edible oil which can be refined to get vegetable oil and ground cake which is a valuable input in the preparation of animal feed and at such can be sold to animal feed millers.
A short fall in the supply of vegetable oil as been identified even after seven years of implementing the presidential initiative on vegetable oil production in Nigeria.
The investor can take advantage of a number of incentives that have been put together to encourage investment in agriculture. These include;
o Finance Credit
o Tax Holdings
o Reduced Customs Charges on Imported Inputs
o Technical Support through Research Institutions
o Export Financing and Guarantee
o Agricultural Insurance Scheme
o Extension Services
Get our market research report on the following related topic by clicking on any of the titles below
1. VEGETABLE OIL PRODUCTION FROM GROUNDNUT SEED; THE FEASIBILITY REPORT.
2. GROUNDNUT {PEANUT} EXPORT IN NIGERIA; THE FEASIBILITY REPORT.
3. HOW TO MAKE HUGE PROFIT SUPPLYING GROUNDNUT SEEDS TO LOCAL INDUSTRIES IN NIGERIA.
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