Comparing Nigeria’s palm oil production with Malaysia, Indonesia, Thailand not fair – NIFOR ED

Comparing Nigeria’s palm oil production with Malaysia, Indonesia, Thailand not fair – NIFOR ED

The Nigerian Institute for Oil palm Research (NIFOR), established in 1939, is saddled with the mandate to conduct research into the production, products of oil palm and other palms of economic importance with the aim of transferring its research findings to the public.


October 3, 2020

Celestine Ikuenobe, acting executive director of NIFOR, in this interview with PREMIUM TIMES believes that the continuous dwindling of Nigeria’s palm oil production could be attributed to low rates of planting high yielding seedlings and land tenure systems when compared with major competing countries like Indonesia, Malaysia, and Thailand.

He said sometimes, those comparisons are not fair because the socio-economic conditions of Nigeria are very different from theirs.

In 1965, the World Bank injected nearly $2 billion into over 45 projects in Southeast Asia, Africa, and parts of Latin America to support the growth of the palm oil industry. Indonesia received $618.8 million, which was the highest. Nigeria received the second highest funding of $451.5 million followed by Malaysia with $383.5 million in project funding.

From 1975 to 2009, Nigeria remained the second largest recipient of funding from the apex bank for palm oil investments with six projects. However, only one project survived while the rest went bankrupt, according to an analysis by PwC, an international auditing firm.

Also, the latest auditor general’s report said NIFOR could not account for about N256 million.

Today, Nigeria is the fifth largest palm oil producing country, with 1.5 per cent or 1.03 million metric tonnes of the world’s total output, according to the United States Department of Agriculture (USDA).


PT: For 81 years after NIFOR was established, it appears its mandate has been altered because every year what we see in the budget are constituency projects that are at times not fulfilled, does this bother you?

Ikuenobe : Well, I cannot say it doesn’t. But you see, by 1964, our mandate was expanded to include coconut, rafia and date palm, because before then, we were doing only oil palm but there were some skeletal works going on, on coconut mostly to understand the coconut pest and diseases, and then coconut nutrition. But concerted efforts on coconut research kick-started in 1964 and fully by 1967 and we were having problems, then for date palm, much efforts started in the 1970s

But again, by 2005, we were already down there to cover shea trees from which we make shea butter. The Shea butter is an internationally traded fat for pharmaceuticals and confectionaries. It is widely accepted and that’s a tree not a palm itself and that covers oftentimes the dry Savannah belts of Nigeria. But in very humid forests we have oil palm and coconut and in the dry parts of the country we do date palms in Jigawa state. Date palm activities cover most of the Sahel parts of Nigeria.

But as for whether the constituency projects get into our budget or not, that may just be one way that the National Assembly appropriates budgets for their own constituencies through institutions. I’ll give an example. Sometimes in some of these constituency projects, we have to train and empower women for them to understand ways of making soaps or processing palm oil; some of them also ask us to train them on cultivation, processing and marketing of palm oil. So, I won’t say those bother us.

PT: The latest Auditor General’s report has it that NIFOR could not account for how N256 million disbursed to the Institute was spent. How will you react to that?

Ikuenobe: Well, you see sometimes people rush to publish things in this country. As a government official, sometimes I’m not allowed to make much comments. Most of the things that they rush to publish, nobody can tell you that there was fraud or something. It might just be there are bits of papers not put in place when the auditors came to see what it was and then to explain. I wasn’t the chief executive then, but there was a part of the report I read that said money was spent for research.

This is a research institute for God’s sake, so if I sent a scientist,for instance, to Akwa Ibom, he will take DTA. He won’t use his car to go, he has to sleep in a hotel. So, when he comes back at the end of the day, then you tell me why did they spend money on that research? And then you say we cannot account for that research. They will say where is the outcome of the research? Or they will say that a set up was done somewhere, so where’s the outcome of that? Some will even say where are the field pictures of the research? All I’ll say is that some of the reports out there, some will be true and some are sensational which doesn’t reflect the true position of things.

That report was for 2017, and I began to head this place in November 2018, so I tried to give answers to the report and all that. So in between the transitions and all that, I don’t know how much response they gave to all the queries. There are some reports they sent to us, and I asked them do they really come to audit or they came to find faults? Meanwhile, I’ve asked our account people to look at the reports again so we can respond to it.

PT: In Oyo, I’ve seen the crude, unhygienic ways palm oil is processed in local communities. Much stress, less returns. What is your institute doing to change this narrative?

Ikuenobe: We have been able to provide some small-scale processing equipment which farmers are already using. Remember I said those farmers in Osun and Oyo states need to be helped. Those women in particular need to be helped. A small-scale processing equipment is all they need. Farmers in this sector, particularly women, can form themselves into cooperatives to buy one of theseequipment and then they can actually use it to do milling for themselves and for other people to earn money for themselves. The equipment is not too expensive, anything from about N2.9 to N3 or N4 million, they can get theseequipment for themselves. What they do now is more of traditional method, which is unhygienic. So, they can improve themselves by acquiring this equipment.

PT: Don’t you think N2.9 million and above is quite too expensive for these farmers to afford, as most of them are barely living from hand to mouth?

Ikuenobe: How much is a tokunbo car (Used car)? That’s why I said they can form themselves into cooperatives. There’s nothing that comes cheap. What you pay for a product might not be a person’s profit. It is the cost of the components the product is made up of.

PT: Is there anyway the government can subsidise the cost of the equipment for these farmers?

Ikuenobe: Yes! In the constituency projects we talked about, these are some of the things they’re doing. Under this, we have recorded some successes. Some people have ordered for the equipment under their constituency projects.

PT: What are the major breakthroughs that you are proud of in the institute based on the research you have been doing so far?

Ikuenobe : Well, if you understand that research is for public good, it is not just one individual that profits from it, and the research we do here profits more than just the Nigerian farmers. It is a global commodity. So, if for example, we are able to assemble some germplasms in which we now recombine the cross to give us higher yielding materials. These higher yielding materials will be used by any farmers across the country, and we have done that. So, materials we have now for oil palm, for instance, will yield for us anything 25-35 metric tonnes of Fresh Fruits Bunches(FFB) per hectare per year, of which anywhere in the world our Nigerian conditions are just the best you can get. Then also, the oil; yield if you extract your oil properly with proper extraction methods, if you are doing like 20-25 per cent extraction you’ll be talking of oil yield from as high as 6-7 metric tonnes per hectare per year, and that is available.

Moreover, if you go to our seed production facility, we are able to reproduce those seeds for farmers now very easily and we are able to provide these materials to farmers to buy and use in their farms. So, to that extent, I’ll say we have done well given the circumstances across the world in oil palm breeding which is the first major window.

The idea is to be able to increase farmers’ potential and efficiency in their yield plan. Let’s assume a man has one hectare of land, if at harvest, the man gets 20 tonnes of fresh fruits per hectare per year. If he did not plant improved varieties, he is going to be getting around 5-10 tonnes per hectare per year. So, you’ll find out that we have doubled his productivity on the same unit of land, the same energy and the same amount of time and resources in doing that. Then for our small farmers, you know in Nigeria, the industry is dominated by smallholders. Women mostly dominate the process in the rural areas, and then their processing methods are faulty with a lot of problems in the form of energy inefficiencies, drudgery and poor quality of oil which doesn’t meet industrial standards; so, they get poor value for that.

Now we have been able to develop and fabricate materials that are suitable for smallholders’ scale users not for the bigger scale users, you know. So, I’ll say that we’re not doing badly in that direction. But they’re are other areas which I may not be able to enumerate now. Areas, for instance, which we have been able to understand our Nigerian soils and know what the potentials are. We have been able to also solve some pathological problems, pests and diseases outbreaks. So, we’re researching everyday to understand these problems. And as you know, research doesn’t end; you have to keep improving on efficiencies.

PT: In the 1960s, Nigeria used to top the global oil palm export market ranking, but currently, the country has dropped from that scale to 5th globally, what do you think are the issues, and can the country bounce back?

Ikuenobe: First, to say Nigeria bouncing back will mean we need to produce enough that we need so that we don’t import. And also producing enough for our industrial use so that we also don’t import. Bouncing back into the export market may not necessarily be the priority now. You can understand, for instance, that the problem has been low rates of planting going on and people always want to compare us with Malaysia, Indonesia and Thailand.

Well, I will say sometimes those comparisons are not fair because if you look at the social and economic conditions of this country, they’re very different from theirs. For instance, you want to grow oil palm and you want to acquire 100 hectares of land. The efforts and energy you will spend in acquiring just 100 hectares of land and the opposition you’re going to come across even from your community makes it difficult to acquire large acres of land in Nigeria; let’s understand that. In South-east Asia, it is a straightforward thing, a corporation can acquire a large acre of land and nobody will quarrel with that.

In Nigeria, we have a very high population of about 200 million, so if you look at our population density you will see that it is far higher than those countries you’re talking about. Then you should also look at what areas are suitable for oil palm. You’ll see that it’s the narrow belt of the humid tropics, which is very narrow. For now, we want to see how we can expand our palms into the Savannah areas. That’s where we have a lot of land. But where it is suitable in Nigeria we have a very high population density and we don’t have land available.

If you go to Abia state for instance, you cannot get 5000 hectares of oil palm land available easily without infringing on communities. But if you go to Kogi and Niger states, we have a large expanse of land where you’re not going to encounter community problems but those areas are not suitable for commercial oil palms, largely because of rainfall. Except if we want to go into irrigation and irrigation can take a lot of energy to do and can be quite expensive. So, if we want to weigh the options, what then can we do? In where we’re now, for instance, I won’t lament that we’re at fifth position. That is not our problem.

My first lamentation is that how do we grow more oil palm to be able to meet our national needs. You should also look at the fact that we have had old plantations that have not been replanted for very many years. It is possible that many people are no more interested in that, because they’re alternative businesses that people could put their money into. Those moribund plantations cannot be as good as young plantations. Some as old as 50-60 years in value. Some of the youngest are, at best, 45 years old. So, productivity in those areas will be far far lower. Once we’re able to do that replanting and expand areas under cultivation you can get near them. But as for the export market for now, in my opinion, is not our first priority.

PT: You just mentioned that land acquisition in regions of the country most suitable for the sprouting of oil palm is a huge problem, but who are the major plantation owners in Nigeria?

Ikuenobe: The smallholders’! A lot of women smallholders, many. They’re very many. They are the very majority. In fact, nobody has a specific statistics of their number now. But as for the old statistics, we have about 80 per cent, while the medium and commercial holders are doing about 10 per cent respectively. But now, large plantations are now doing between 10-20 per cent and smallholders still maintain 80 per cent is all I can say for now. But the big players you may want to understand currently are the Okomu oil plantation and Presco plc quoted on the Nigerian Stock Exchange (NSE). Those are the biggest players we have in the country. Also, PZ Wilmar in Cross River and Dufil who is just developing a new area. So those are the big players we can talk about in the country.

PT: What are your closing remarks in this regard?

Ikuenobe: First, NIFOR is a Nigerian Institute working for the good of the Nigerian public, and we’re always available for the Nigerian public. The Nigerian oil palm farmers are doing well. But the problem we found with many of them is that they buy seeds that are not certified from anywhere and from anybody on the roadside. That’s why they’re not productive as they’re supposed to be. We are available to anybody because this is a public institution. Our numbers are on the website. Anybody can call, we will pick any call from anywhere in order to respond to farmers’ needs.

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