24 March 2019

Nigeria: As Dangote Tomato Firm Resumes

Last week, there was some good news in the agricultural sector, with the Dangote Group announcing resumption of work at its Tomato Processing Plant at Kadawa, Kano State. Activities at the plant had been suspended for about two years due to lack of raw tomatoes and inability to reach an agreement with local farmers over price. The plant, which is the biggest in Africa, suspended production barely one year and five months after it was launched. The factory has a capacity of 1,200 metric tons of tomato paste daily.

The firm's Managing Director Abdulkarim Kaita said in Kano, "Our major challenge is getting the tomato that would be sufficient for our daily production. The last time, local tomato growers could not meet our production demand. We also could not agree with the farmers on the price of tomato per basket." He said the company now has a new deal with the farmers where the factory will buy raw tomatoes at prices pegged to the price in local markets. He said Dangote Group is also developing a special tomato strain on its farms that could yield 60 tons per hectare, compared to local farmers' yield of 10 tons per hectare.

We congratulate the Dangote Group for reviving the plant, as the importance of such a company in this country cannot be overemphasised. The plant should be a source of pride to Nigeria. Efforts should be made, therefore, to ensure that it does not suspend activities again. For several years, the federal government has talked about banning tomato paste importation as a means of encouraging local production and also boosting our foreign exchange earnings. But it has not been able to do so because of the unavailability of enough locally produced tomato paste. This plant can help it achieve that goal. If the company is producing at maximum capacity and able to provide the needed tomato paste, then there will be no need to import the product.

Also, tomato farmers in Nigeria have a problem of wastage during the harvest season due to lack of storage facilities. A lot of tomato is wasted during the harvest season, only for it to become scarce and costly in the wet season. This company can now buy up the products from local farmers and transform it to tomato paste. It is a win- win situation for both farmers and the company. With that, more people can be encouraged to go into farming as the fear of not recouping their capital due to non-availability of market will no longer be there.

It will also help to tackle the major problem of unemployment as a lot of people will be needed to manage the equipment in the company and handle the various sectors. The Dangote Group is doing a lot to boost industrialisation in the country and we commend it for its efforts. We also urge more individuals to emulate the Group, but as we all know there is a limit to how much one company can achieve in a country as large as ours. To sustain a company of this magnitude for it to operate at maximum capacity and produce items for about 198 million people, the federal government needs to intervene either through the Bank of Industry or the Bank of Agriculture, so that it would have the funds to purchase the necessary materials and even engage in large scale farming.

We have the land and the weather to grow tomato, so there is no reason why there should be scarcity of the raw material for tomato paste. All that is needed is support. Nigeria is in need of several of such companies, but they will have to be assisted by the federal government to succeed and indeed carter to the needs of citizens. If we want to address the issue of importation of food items, then mechanised farming must be emphasised. It is not enough to mouth banning of importation if alternatives are not provided.

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