In a landmark development that promises to reshape Nigeria’s cocoa industry, Johnvents Group, a leading agribusiness and manufacturing conglomerate, has announced a strategic partnership with British International Investment (BII), the United Kingdom’s development finance institution and impact investor. This collaboration will see an investment of $40.5 million, aimed at boosting cocoa production, enhancing global export capabilities, and creating more economic opportunities for Nigerian farmers.

The move is particularly timely, as the global cocoa market experiences fluctuations and rising demand for sustainably sourced cocoa. This partnership positions Johnvents Group to become a key player in the international cocoa industry while reinforcing Nigeria’s potential as a leading cocoa producer.

Expanding Nigeria’s Cocoa Processing Capacity

One of the primary objectives of this investment is the expansion of Johnvents Group’s subsidiary, Premium Cocoa Products, based in Ile-Oluji, Ondo State. The funding will significantly boost the company’s cocoa processing capacity from its current 13,000 metric tonnes per year to 30,000 metric tonnes. This will ensure that Johnvents Group can meet the growing global demand for cocoa-based products while strengthening Nigeria’s position as a major supplier.

Benson Adenuga, Coverage Director and Head of BII’s Nigeria Office, underscored the importance of this partnership, stating that it would not only benefit Nigerian cocoa farmers but also improve the country’s trade balance and competitiveness in the global market. The investment is expected to create thousands of direct and indirect jobs while fostering economic growth across Nigeria’s cocoa-producing regions.

This expansion is particularly critical given that Nigeria is the fourth-largest cocoa producer in the world, yet it has not fully maximized its export potential. With countries like Côte d’Ivoire and Ghana dominating the global cocoa trade, Nigeria’s underutilized production capacity has limited its ability to capitalize on the rising global demand. Through this investment, Johnvents Group is set to change that narrative.

Commitment to Sustainability and Traceability

A major component of the partnership is the drive towards sustainability and traceability within Nigeria’s cocoa value chain. Johnvents Group has committed to achieving 100% traceable cocoa by 2027, with at least 90% of its products certified under recognized sustainability programs such as the Rainforest Alliance.

Traceability has become a key factor in global cocoa trade, as major buyers, including multinational chocolate manufacturers, increasingly demand cocoa that is ethically sourced and free from child labor and deforestation. With increasing regulatory scrutiny in markets such as the European Union and North America, Nigerian cocoa exporters must meet stricter compliance requirements to remain competitive.

BII’s investment will help Johnvents implement cutting-edge traceability systems, ensuring that cocoa beans can be tracked from farm to final product. This will give international buyers confidence in the integrity of Nigerian cocoa, opening up more lucrative markets and securing long-term supply contracts.

Economic Opportunities for Farmers and Local Communities

Nigeria’s cocoa industry is largely driven by smallholder farmers, who contribute over 80% of the country’s total production. However, many of these farmers face significant challenges, including limited access to financing, outdated farming techniques, and poor market access.

The Johnvents-BII partnership aims to address these issues by providing farmers with better resources, training, and access to fair pricing. By strengthening the cocoa value chain, smallholder farmers will benefit from increased earnings and improved livelihoods.

Additionally, the expansion of the Premium Cocoa Products processing facility will generate employment opportunities, not only for farmers but also for workers in the processing and logistics sectors. The increased production capacity will lead to a higher demand for skilled and unskilled labor, further contributing to the economic development of cocoa-growing regions.

A Strategic Move Amidst Global Cocoa Market Trends

This investment comes at a time when the global cocoa market is experiencing significant disruptions. In recent months, cocoa prices have surged to record highs, exceeding $10,000 per ton, primarily due to climate change-related challenges in major cocoa-producing countries like Ghana and Côte d’Ivoire. Erratic weather patterns, including droughts and excessive rainfall, have led to poor harvests, reducing global cocoa supply.

Nigeria, on the other hand, has seen a sharp increase in its cocoa earnings, with exports surging by nearly 300% in the first quarter of 2024. This growth has been fueled by increased international demand and supply shortages in other producing nations.

By expanding its processing capabilities, Johnvents Group is positioning itself to take advantage of these favorable market conditions. Instead of exporting raw cocoa beans, which have lower value, the company will process cocoa into semi-finished and finished products, such as cocoa butter and cocoa powder. These value-added products fetch higher prices in the global market, allowing Nigeria to capture more value from its cocoa sector.

Government Support and Alignment with National Policies

The Nigerian government has long emphasized the need to diversify the economy away from oil dependency, with agriculture identified as a key sector for growth. Policies and initiatives aimed at improving agricultural infrastructure, providing incentives to farmers, and supporting value addition in agricultural exports have been at the forefront of this strategy.

The partnership between Johnvents Group and BII aligns perfectly with these national objectives. By increasing local processing capacities, the collaboration will reduce Nigeria’s reliance on raw cocoa exports, thereby retaining more value within the country. This will not only increase foreign exchange earnings but also strengthen the economy by creating jobs and supporting rural development.

Government agencies such as the Nigerian Export Promotion Council (NEPC) and the Central Bank of Nigeria (CBN) have been actively promoting cocoa processing through various intervention programs. The infusion of private sector investment through BII’s funding complements these efforts, ensuring that Nigeria’s cocoa industry remains competitive on a global scale.

Investment in Technology and Capacity Building

A significant portion of the $40.5 million investment will go towards upgrading technology and capacity building. Johnvents Group plans to modernize its processing plant with state-of-the-art machinery to improve efficiency, product quality, and compliance with international standards.

In addition, the company will implement training programs for farmers and factory workers, focusing on sustainable farming practices, quality control, and supply chain management. These programs will help farmers increase their yields while ensuring that the cocoa they produce meets international quality standards.

John Alamu, Group Managing Director of Johnvents Group, highlighted the broader implications of this investment, stating that it is not just about boosting processing capacity but also about building a sustainable agribusiness ecosystem that benefits all stakeholders.

Broader Implications for Nigeria’s Economy

Beyond the cocoa sector, this investment has far-reaching implications for Nigeria’s broader economy. The expansion of the Premium Cocoa Products facility will stimulate ancillary industries, including logistics, packaging, and agritech services.

Furthermore, the increased export earnings from processed cocoa products will help improve Nigeria’s trade balance, reduce reliance on oil revenue, and provide more stability to the economy. By promoting sustainable agricultural practices and strengthening value chains, Nigeria can position itself as a leader in ethical cocoa production.

Additionally, the focus on Black-owned and led businesses is a key component of BII’s investment strategy. Historically, many African enterprises have struggled to access capital, limiting their growth potential. By supporting companies like Johnvents Group, BII is helping to address systemic barriers to financing and fostering the development of strong, locally owned businesses that can drive economic transformation.

Conclusion

The strategic partnership between Johnvents Group and British International Investment marks a defining moment for Nigeria’s cocoa industry. With a $40.5 million investment, the collaboration will significantly enhance cocoa processing capacity, promote sustainability and traceability, and create economic opportunities for local farmers.

At a time when global cocoa markets are experiencing volatility, this initiative strengthens Nigeria’s competitive position while aligning with national economic diversification efforts. By prioritizing value addition and ethical sourcing, Johnvents Group is setting a new standard for agribusiness in Nigeria, with far-reaching benefits for the economy and the global cocoa supply chain.

With this investment, Johnvents Group is not just processing cocoa; it is shaping the future of Nigeria’s agricultural sector, ensuring sustainable growth and long-term prosperity for all stakeholders involved.

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photo source : Google

By: Montel Kamau

Serrari Financial Analyst

19th February, 2025