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Nigeria consumes more than 1
million tons of sugar annually. Available data from the website of National
Sugar Development Council shows that the annual Sugar consumption in Nigeria
steadily increased from 645,248 tons in 1990 to 1,433,471 tons in 2014. Within
the same period, the highest contribution from the local production was in 2007
when 55,000 tons was produced, which was equivalent to a merely 4.4% of the quantity
(1,258,996 tons) consumed in that year. In
2014, only 12,345 tons of sugar was locally produced, which made the country to
import 91% of the sugar consumed locally. On the average Nigeria produces a
paltry 2 % of the sugar consumed locally with the nation spending billions of
hard currency to import sugar in addition to many other food items. One of the
news items reported by Julia Fioretti of Reuter News, London indicated that Nigeria
pays a bill of $11 billion-a-year for food importation on the average. This
ugly trend causes serious concern to Nigerians especially the leadership because
the country is a huge sugar market of over 165 million consumers with unlimited
opportunities for investors. There are uncountable comparative and competitive
advantages for local sugar production in several states in the country
especially in the north and central parts of Nigeria. Government initiated
intervention to holistically address the issue.
In
2008, the Federal Government directed the National Sugar Development Council
(NSDC), to develop a road map for the attainment of self-sufficiency in sugar
within the shortest time possible. In compliance, the Council came up with the
Nigerian Sugar Master Plan. In September, 2012, the Federal Government approved
the Nigerian Sugar Master Plan (NSMP), which marked a new phase in the
development of the sugar industry. The objectives of the NSMP are to raise
local sugar production to attain self sufficiency; provide specific fiscal
incentives investors to attract investment into the sector. At the same time,
government formulated Backward Integration Programme (BIP) to discourage
massive importation of the sugar into the country. Provision of support
incentives, robust monitoring and evaluation of BIP; stem the tide of high
level importation; high graduated tariff structure on sugar importation; import
quota allocation benchmarked on local production. Some of the incentives are:
Ø Low duty of 2.5% on machinery for the industry;
Ø Chemicals for sugar production have zero duty;
Ø Import duty of 20% on refined sugar, as well as a
development levy of 10% and VAT of about 5%;
Ø Provision of infrastructure including access
roads, boreholes, power lines, land acquisition, and health
care facilities for new sugar estates;
Ø 100 percent foreign ownership of sugar
complexes is allowed;
Ø Provision of a credit support scheme for
sugarcane growers in collaboration with the Central Bank of
Nigeria (CBN) and commercial banks
However, these incentives encourage
investments at downstream level of the sugarcane value chain rather than
upstream level where production takes place. The major activities at the
downstream level are sugar refining, packaging and distribution. Nigerian annual
Sugar Report of 2013 made by the United State Development Agency (USDA) estimated
the sugar refining capacity of Nigeria to 2.1 million tons, which exceeds the
country’s current total sugar demand of 1.45 million tons. However, the
country’s sugar refineries depend almost exclusively on brown sugar from Brazil
at five percent duty. About 98 percent of all imports come in the form
of raw sugar and is refined locally while the remainder of imports is refined
sugar. More than 90 percent of raw sugar was imported from Brazil.
So far, this situation assisted or encouraged investment in sugar refining rather
than in production. To discourage sugar importation, the Federal Government
introduced a new sugar tariff regime at the beginning of the year, 2013 and raw
sugar imports began to attract a 10 percent import duty, and a 50 percent levy,
effective January 2013. This newer regime was meant to stimulate local sugar
production. Even though total privatization of Nigeria’s sugar estates was
accomplished, the country’s sugar production continues to lag far behind
consumption. The privatization is yet to show the desired results. Recently (4th February 2016, at
Hamdala Hotel, in Kaduna), a sensitization workshop was
organized by the
National Sugar Development Council (NSDC) and was attended by key stakeholders.
Part of the communiqué at the end of workshop noted that “the gains and
impact of the Nation’s privatized Premier Sugar Company at Bacita which was
taken over by Josepdam and the Lafiagi Sugar project bought by BUA Group have
not yet been felt and therefore called on Federal Government and its relevant
agencies to critically examine the extenuating circumstances militating against
the effective performance under the new ownership arrangements”. This clearly indicates that
huge investment in public infrastructure and human/material resources are
urgently needed for the country to catch up with the current and fast growing sugar
demand.
In recent times, we witnessed more
investment in sugar industries, last week, this paper Leadership Friday reported billions of Naira worth of investment in
the sector by Flour Mills of Nigeria PLC (FMN), FMN is a conglomerate with
active presence in several sectors of the Nigerian market including Agro-Allied.
It made history when one of its subsidiaries; Sunti Golden Sugar Estate started
sugar production in its new N45 billion sugar Mill near Mokwa in Niger state.
Sunti Sugar has 20,000 hectares of irrigable farm land and a giant sugar
factory using latest technologies to mill up to 4,500 metric tons of sugar per
day. FMN has also invested N50 billion in a state of the art sugar refinery in
Apapa capable of refining up to 2,000 metric tons per day. The first stage of the group investment in
local sugar production will produce over 100,000 metric tons of sugar, create
over 25,000 new jobs, generate 10MW of excess electricity, produce animal feeds
and fertilizer from sugar molasses by products and save 50 million dollars in
foreign exchange for the nation. The project was supported by the Federal
Government through a N25 billion loan from CBN at subsidized interest rate
Nigeria
has all the potentials to produce sugar for home consumption and exportation, According
to the National Sugar Development Council (NSDC), Nigeria has a land potential
of over 500,000 hectares of suitable cane fields that can produce over 5
million metric tons of sugarcane that when processed, can yield about 3 million
metric tons of sugar, which will be twice the national sugar demand. What are
the problems? Inadequate infrastructure and low quality sugarcane planting
materials? With poor infrastructure especially at the rural areas making access
to the farm lands very difficult, sugar production continues to be unattractive
to farmers and investors while the national sugar consumption continues to
grow. In addition to poor infrastructure, the traditional method of sugarcane
propagation is another serious challenge to the sugarcane production. Plants that do not produce seeds or even when they produce
seeds, the seeds are often heterozygote and are of no use in breeding and plants that have low multiplication ratio
such as banana, pineapple, cassava, date palm, sugarcane etc are usually
propagated by vegetative means (asexually).
Vegetative method of propagation is slow, only a few propagules
are produce from a plant in a year and allows the transfer of systemic diseases from one generation to another. Another challenge
of local propagation is bulkiness of the planting materials. Example, one needs
sugarcane quantity of one hectare to transplant on a 10 – hectare area using
the traditional method of vegetative propagation. What is the solution?
The
solution to the use of local method of vegetative propagation to sugarcane
planting materials is to use plant tissue culture. Plant tissue culture is a collection of techniques used to maintain or grow
plant cells, tissues or organs under sterile conditions on a nutrient culture
medium of known composition. Plant tissue culture is widely used to produce
clones of a plant in a method known as micro-propagation. The
tissue culture is based on the concept of Plant regeneration; the regeneration
may occur through two pathways that is organogenesis which is the production of
shoots, followed by root formation or through somatic embryogenesis whereby
fully formed embryos are generated and subsequently induced to germinate.
Application of plant tissue cuture to decuple national sugarcane production
within few years is another task taken by the famous Ahmadu Bello University
(ABU), Zaria, the most cosmopolitan ivory tower south of the Sahara. In this
regard, a sugarcane
biofactory was established by Institute for Agriculture (IAR), one of the oldest and outstanding
research centers of ABU in collaboration with National Sugar Development Council, Abuja.
The Sugar biofactory was commissioned one year ago in the Agricultural Complex
of the university and the plant scientists of the university have since begun
earnest work to achieve the desire results. What is the progress? How promising
is this technique? What are the challenges to sugar biofactory? (To be
continued next week) Read the Newspaper version
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