Nigeria’s biggest and state-of-the-art tomato factory located in northern Nigeria owned by Dangote is producing tomato puree only on paper, as there are hardly activities in the plant.
Investigations indicate that there are not enough tomatoes to run the plant even though there are machines ready to crush tomatoes to satisfy the country’s insatiable demand for tomato paste.
Aliko Dangote, launched the plant in March 2016, contracting Italian engineers working for months on 350 euro-a-day allowances to set up the machines outside Kano, the main city in the north.
On paper, it looked like a smart move as Nigeria imports up to 400,000 tonnes of tomato paste annually. The tinned paste is an ingredient in Nigerian tomato stew, used as the base for a host of traditional meat stews, sauces, soups and rice dishes that are staples of Nigerian cooking.
However, the bold move is fast becoming a powerful symbol of Nigeria’s uphill challenge to build up agricultural production and end costly food imports. It is on record that Nigeria imports staples from milk to wheat to tomato paste, with funds it mainly earns from exporting oil.
The plant is reported to be standing idle for weeks because of lack of tomatoes. A.L. Kaito, its frustrated manager told Reuters that they are however trying to weather the storm.
“We are trying to weather out the storm, the cost is horrendous,” said Kaito. “It’s a nightmare.”
The tomato plant hopes to restart work in January at just half of its capacity of 1,200 tonnes a day after the next season, in the meantime costing N5 million every month.
Dangote has kept workers sitting at home on the payroll: the Italians spent months training them on the new machines.
The investment is paltry for its owner, who is spending billions of dollars on cement plants, sugar and rice schemes across Africa. His cement business alone posted revenues worth in N615 billion in 2016.
Dangote spent some N4 billion ($12.74 million) on the plant and now plans to set up its own tomato cultivation scheme for around N10 billion to cover up to 70 percent of its needs, buying land and tractors.
Experts from Israel, Mexico and Spain will be flown in.
Dangote Group had thought of every technical detail, even setting up a control room linking its engineers to experts in Italy in case there was a problem. But it underestimated the difficulties involved in getting tomatoes, despite signing deals with some 5,000 farmers guaranteeing them to pay more than the market price.
Lacking fertilizers and working with their bare hands, the farmers have been unable to produce the quality and quantity the plant needs to make the paste. Records have it that much of the farmers’ last season outputs were wiped out by pest.
The plant has been so far unable to find other supplies despite Nigeria producing some 1.5 million tonnes of tomatoes annually. A lack of good roads due to decades of corruption means tomatoes would perish on the way. Half of the country’s output gets wasted.
To encourage agriculture investments like the Dangote plant, the government has waived duties for greenhouse and processing equipment.
It is also giving subsidies to rice farmers and is considering expanding the scheme to tomato growers, a senior official in the federal ministry of agriculture said.
But experts and farmers say, after decades of corruption holding back road and electricity projects and an obsession with producing oil, it will take time to improve the tomato output.
Low-quality seed and a lack of power for pumping water means tomatoes can be grown only during the dry season, which creates a glut in March.
Farmers then lay out their tomatoes alongside highways hoping motorists will buy them. Anything that does not get sold within 24 hours is usually wasted due to a lack of cold storage.
“We don’t have fertilizers and there is no power for cold rooms,” Sani Yadakwari, chairman of some 10,000 tomato farmers in Kano state told Reuters, adding “We need subsidies for our production.”
Dangote has been supplying farmers with a Dutch seed, which is expected to gradually boost the yield to 50 tonnes of tomatoes a hectare from 10 to 15 tonnes now, said Kaito.
But Adamu Sani, an agronomist working for the World Bank, was sceptical production would rise soon as farmers needed to get trained to use the new seeds which had not been tested yet on a large scale in Nigeria.
Dangote calls the plant the biggest in Africa. But the size might be a disadvantage: “The minimum capacity of the Dangote plant is too high for the little volumes you can get from farmers,” Sani told Reuters.
Frontpage November 14, 2018
Equities January 29, 2020