The Nigerian Agricultural Landscape: A Wealth of Opportunities

Have you ever considered that Nigeria, often dubbed the “Giant of Africa,” holds untapped agricultural potential that could not only feed its burgeoning population but also transform its economy? As an entrepreneur within the African diaspora, you possess a unique opportunity to harness this potential, driving economic growth, creating jobs, and addressing food insecurity. But how can you, from miles away, make a tangible impact on Nigeria’s agricultural landscape?

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Nigeria’s vast and fertile land spans over 923,768 square kilometers, with approximately 70% suitable for agriculture. Yet, only about 40% of this arable land is currently under cultivation. This underutilization presents a significant opportunity for investment and development. The country’s diverse climate allows for the cultivation of a wide range of crops, including cassava, yams, maize, rice, and cocoa.

Nigeria is notably the world’s largest producer of cassava, yielding over 60 million metric tons annually. However, despite these advantages, the agricultural sector faces challenges such as outdated farming techniques, inadequate infrastructure, and limited access to financing.

See also: Cassava in Africa: Its Role in Food Security and Economic Development

The Role of the African Diaspora in Agribusiness Development

As a member of the African diaspora, your involvement can be pivotal in transforming Nigeria’s agricultural sector. The Food and Agriculture Organization (FAO) emphasizes the importance of engaging the diaspora to contribute resources and skills to rural areas, supporting agro-entrepreneurs through mentorship, coaching, and investments.

Your international exposure and access to resources position you to introduce innovative farming practices, advanced technologies, and sustainable business models that can enhance productivity and profitability in Nigerian agriculture.

Investment Avenues: From Primary Production to Value Addition

According to a report by the United Nations Development Programme, “MAKING THE CASE FOR INVESTMENT IN CASSAVA,” the economic return on investment in cassava is notably strong.

The report highlights a Benefit-Cost Ratio (BCR) of 2.50 for the multiplier model and 3.11 for the Computable General Equilibrium (CGE) model over 10 years. Cassava investment outperforms sectors like livestock, food production (BCRs of 1.50 and 3.06, respectively), and tourism (BCRs of 1.90 and 2.51, respectively), with results that are competitive when compared to rice production (BCRs of 2.20 and 3.13, respectively).

While rice production shows a slightly higher outcome in the CGE model, the nominal GDP gains for cassava are nearly on par, amounting to US$942 million, just shy of US$949 million for rice.

This data underscores Cassava’s robust potential as a strategic investment avenue for both primary production and value-added activities. Now what can be your investment in Nigeria’s agriculture? See the following recommendations:

• Primary Production: Investing in crop and livestock farming can increase food supply and generate employment. For instance, cassava farming offers substantial returns due to its versatility and high demand in both local and international markets.
• Agro-Processing: Establishing processing facilities adds value to raw agricultural products, leading to higher profit margins. Processing cassava into products like ethanol, starch, and flour can meet industrial demands and reduce post-harvest losses.
• Agri-Tech Solutions: Introducing technology-driven solutions such as precision farming, drone surveillance, and mobile-based market information systems can revolutionize farming practices, making them more efficient and profitable.
• Supply Chain and Logistics: Improving the transportation and storage infrastructure ensures that agricultural produce reaches markets timely and in good condition, reducing waste and increasing farmers’ incomes.

Case Study: Cassava – A Catalyst for Economic Growth

Cassava stands out as a crop with immense potential. Beyond its role as a staple food, cassava has various industrial applications, including ethanol production, paper manufacturing, and as a raw material in the textile industry.

You can see moreProcessing and Marketing of Selected Cassava Products in South-east Nigeria

Investing in cassava farming and processing can lead to significant economic benefits. For example, Nigeria’s ethanol demand exceeds 1 billion liters annually, presenting a lucrative market for cassava-based ethanol production. Additionally, cassava starch is in high demand in the food and pharmaceutical industries, both locally and internationally.

Overcoming Challenges: Collaborative Efforts for Sustainable Impact

While Nigeria’s agribusiness sector holds enormous potential, a range of systemic challenges has hindered its full development. Limited access to finance, inadequate infrastructure, outdated farming techniques, and policy inconsistencies have made it difficult for small and medium-scale farmers to scale their operations.

However, these challenges are not insurmountable. Through strategic collaborations between diaspora investors, local farmers, government agencies, and financial institutions, these issues can be effectively addressed, paving the way for a more productive and profitable agricultural sector.

1. Access to Finance: Unlocking Capital for Growth 

A key barrier to agribusiness expansion in Nigeria is limited access to finance. According to the African Development Bank (AfDB), smallholder farmers in Africa receive only about 10% of total credit from financial institutions, despite contributing over 70% of the continent’s food supply. This funding gap makes it difficult for farmers to invest in improved seeds, irrigation systems, mechanization, and agro-processing facilities. 

Solution:

Diaspora investors can bridge this financing gap by: 

• Partnering with financial institutions to create dedicated agribusiness loan facilities for small and medium-scale farmers. The Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL), for instance, provides credit guarantees to encourage banks to lend to the agricultural sector. 
• Leveraging diaspora remittances for agricultural investments. According to the World Bank, Nigeria received $20.1 billion in remittances in 2022, a significant portion of which could be channeled into agribusiness ventures. 
• Exploring impact investment opportunities, where funding is directed at sustainable and profitable agribusiness projects that create both economic and social value. 

See also: The Economic Value Of Cassava Farming In Africa Today

2. Infrastructure Deficiencies: Strengthening Supply Chains

Nigeria’s agricultural value chain suffers from poor transportation networks, limited storage facilities, and inefficient distribution systems. The post-harvest loss rate in Nigeria is estimated at 30-50%, according to the Food and Agriculture Organization (FAO), meaning that nearly half of harvested crops never reach consumers due to spoilage.

Solution:

• Invest in cold storage and processing facilities to reduce post-harvest losses. Agro-processing centers that turn perishable goods into longer-lasting products (e.g., cassava into flour or ethanol) can create value and reduce waste. 
• Develop logistics and transportation networks by investing in haulage services, rural road development, and direct farm-to-market distribution models. 
• Partner with tech-driven agribusiness startups that focus on supply chain efficiency. Companies like Farmcrowdy and Thrive Agric have developed digital platforms that connect farmers with buyers, improving market access.

3. Policy and Regulatory Inconsistencies:

Advocating a Stable Business Climate. Unstable policies and bureaucratic hurdles have historically discouraged investment in Nigeria’s agricultural sector. Farmers and agribusiness investors often struggle with shifting government policies on tariffs, import bans, and land ownership rights.

Solution: 

• Engage with policy advocacy groups like the Nigeria Agribusiness Group (NABG) to ensure the interests of farmers and agripreneurs are represented. 
• Leverage diaspora influence to engage with the Nigerian government on policy reforms that promote agribusiness investments. The Nigerian Diaspora Commission (NiDCOM)  has facilitated several initiatives to connect diaspora investors with local opportunities. 
• is to Support public-private partnerships (PPPs) that align with long-term agricultural development goals, such as the Anchor Borrowers’ Programme (ABP), which connects smallholder farmers with financing and off-takers. 

4. Knowledge and Technology Transfer: Empowering Farmers with Innovation

Many Nigerian farmers still rely on traditional, low-yield farming methods, which contribute to low productivity and food insecurity. With the rise of agriculture technology (AgriTech), there is a massive opportunity to modernize farming and increase yields through innovation. 

Solution:

• Introduce precision farming technologies, such as satellite imaging, IoT-enabled irrigation systems, and AI-driven soil testing, to improve productivity. 
• Develop training programs and farmer cooperatives that provide knowledge on climate-smart agricultural practices, mechanization, and financial literacy. 
• Collaborate with research institutions like the International Institute of Tropical Agriculture (IITA) and the National Root Crops Research Institute (NRCRI) to promote high-yield, disease-resistant crop varieties. 

See also: Preventing Soil-Borne Diseases in Cassava Farming: Crop Rotation Strategies for Nigerian Farmers

Conclusion: Your Role in Nigeria’s Agricultural Renaissance

The opportunity for the African diaspora to transform Nigeria’s agribusiness sector has never been greater. With strategic investments and collaborative efforts, you can drive economic development, create jobs, and enhance food security. 

Your engagement in Nigeria’s agricultural value chain whether through financing, agro-processing, technology adoption, or policy advocacy can serve as a catalyst for change. By leveraging your networks, knowledge, and financial resources, you can help bridge the gaps that have long hindered the sector’s growth. 

The Nigerian government has already implemented diaspora-friendly investment policies, and several international organizations, including the United Nations (UN) and IFAD, have emphasized the importance of diaspora involvement in Africa’s agricultural transformation. 

Now is the time to act. Will you be among the forward-thinking investors who seize this moment to create lasting change in Nigeria’s agribusiness landscape?

Learn How to Leverage Your Story through our Story To Asset Transformation (S.A.T) Framework.