Supply Chain Challenges in the Cocoa Industry Part 1

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The cocoa supply chain in Nigeria is a complex network that includes nodes and exchange sites. It is through these nodes and exchange points that the cocoa beans travel on their journey to processing plants both inside and outside of the country.

The cocoa supply chain in Nigeria follows the format of farm-to-intermediaries-to-factories/consumer, which is typical of the agricultural sector in Nigeria. Most of the time, cocoa is not transported directly from fields to processing companies. Instead, it passes via two, three, or even more intermediaries to reach the locations where value is added before the production stage.

Supply Chain Graph 1

As is the case with many complex systems that are made up of several moving components, the cocoa supply chain in Nigeria faces its fair share of challenges that not only impair its operational efficiency and profitability but also endanger its long-term viability. Let’s take a look at the three different levels of the supply chain and the challenges that are specific to each one.

The Chain’s Most Basic Level

The beginning of the supply chain is symbolized by this base of the pyramid, which is also the most crucial part of the chain. There are no other participants at this level outside the cocoa producers and the brokers who represent them. Furthermore, it goes without saying that there would be no supply chain if the individuals at this level were not responsible for the grunt work of manufacturing instead. In light of this, they are absolutely necessary for the pyramid as a whole. There are a number of reasons that frequently contribute to the difficulties that arise at this point of the supply chain.

Quality of Education Received by Farmers

The cocoa producer sector in Nigeria is negatively impacted by the fact that a significant proportion of the country’s farmers do not have access to a reliable educational system. The fact that a significant number of cocoa farmers are either illiterate or semi-illiterate is a significant obstacle that significantly restricts their potential to generate profits.

Despite the fact that many farmers have acquired practical knowledge of cocoa farming practices through years of laborious work and trial and error, many of them do not possess the managerial skills necessary to enhance their production and output.

On top of that, a significant number of farmers lack the appropriate education regarding the management of materials and the contemporary scientific methods of cocoa production. What is even more disheartening is the fact that many people, when left to their own devices, do not have any means of gaining access to these intellectual resources, which forces them to continue producing in a conventional manner.

This situation creates the first problem at the most important level of the cocoa supply chain. Due to the fact that the foundation is beset with such issues, the structural integrity of the entire supply chain is already deficient.

A farmer with a higher level of education will be better able to handle resources, equipment, and manpower. As a result, they will be able to produce cocoa beans of superior quality, which will pave the way for a truly efficient cocoa supply chain.

Thankfully, Sunbeth Global Concepts and other notable actors in the cocoa supply chain have taken on the duty of addressing this situation. They have done so by training farmers and providing them with the resources they need to produce in a manner that is both more efficient and more environmentally friendly.

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Sunbeth Global Concepts Representative Educating Farmers in Rural Communities

A lack of infrastructure or sufficient quality?

The vast majority of cocoa production in Nigeria happens in rural communities. A significant number of the communities are situated in inaccessible regions that lack the necessary infrastructure to facilitate the transportation of goods to urban populations coupled with the insecurities rocking most parts of the country.

The infrastructure that is available in such contexts is not capable of providing appropriate support for seamless supply chain and logistical operations. As an illustration, the majority of regions do not possess adequate storage facilities or roads that are in excellent conditions, which are two essential components of an efficient supply chain.

Furthermore, the absence of specialized mechanical equipment for cocoa farming is another factor that contributes to this challenge. If farmers have access to the appropriate tools, they will be able to streamline their jobs and reduce the amount of effort they have to put into producing cocoa.

First and foremost, the government is the entity that is accountable for the development of these infrastructures in the communities that are impacted. On the other hand, private participants who possess the means necessary to do so are also able to make contributions to the project for the benefit of society. 

Phew! That must have been a long read, right? The continuing part of this article can be found here. Click on this link: “Supply Chain Challenges in the Cocoa Industry – Part 2.

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