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The Cassava Story. Profitability And Loss Theory - Agriculture (3) - Nairaland

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Re: The Cassava Story. Profitability And Loss Theory by sheyi86: 7:33pm On Feb 18, 2015
Lesgupnigeria:
I do not want to comment initially because i always want to mind my business but as my name being mentioned, i feel the need to put out one or two statements.

@sheyi86: can you please state what i stated on the guy's thread that is not true here?

You sound like a neophyte.

Because you make loss in processing your cassava, does it means other processors are not making good profit?
If you do make loss,then it means that you don't know some things that will make you also to make profit and need to go for more knowledge from experts that are making money from the venture.

When i was starting out in agribusness,i once lose over half a million cultivating watermelon.

Does that mean if someone comes out and say he/she make millions of.naira from watermelon criticise or label him as a fraud?

I learnt from my mistakes,learn from established watermelon.farmers and since then all the watermelon i cultivated was profitable,likewise for other crops.

A lot of theories i would not want to puncture here because everybody has right to his/her own opinion.
Even 2 farmers cultivating the same crop, at the same location cannot be guaranteed to make profit. One may make profit while the other may make loss.
It all boils down to experience, indepth knowledge of the crops and the market, contacts of reliable buyers,managerial skills. e.t.c

Do u remember dat undagraduate dat asked 4 advice on which crop 2 cultivate while on campus? Dat u qouted jethro abt cassava stuff.in ur proof there u make mention of a processor u partner wit which after supplying ur cassava 2 him his machine got fault and u waited 4 sm month b4 he could pay u. Sir, do u think it is profitable 4 farmer after waiting 4 a yr plus and then wait some months b4 he could get his reward 4 his labour? Pls lets be realistic all d buyer u mention wia re they? Are they in heaven? How many farmers can access dis pple, cassava production is nt d issue bt d market.we all knw dat cocoa farmers are smilling all d time because there is always market 4 dis produce regardless of d location.Wot nw happen 2 cassava farmers in nigeria, how many of dis farmer can even sponsor their children thru cassava? If good market 4 cassava really exist it shouldnt be hidden.so, dat is reason y i said wot u say abt cassava is nt true and wot u stated as a proof 4 jethro does nt convince me at all.thanks. Bt i wish 2 learn smthns abt WM frm u.

3 Likes 1 Share

Re: The Cassava Story. Profitability And Loss Theory by stagger: 4:04pm On Feb 19, 2015
sheyi86:
Do u remember dat undagraduate dat asked 4 advice on which crop 2 cultivate while on campus? Dat u qouted jethro abt cassava stuff.in ur proof there u make mention of a processor u partner wit which after supplying ur cassava 2 him his machine got fault and u waited 4 sm month b4 he could pay u. Sir, do u think it is profitable 4 farmer after waiting 4 a yr plus and then wait some months b4 he could get his reward 4 his labour? Pls lets be realistic all d buyer u mention wia re they? Are they in heaven? How many farmers can access dis pple, cassava production is nt d issue bt d market.we all knw dat cocoa farmers are smilling all d time because there is always market 4 dis produce regardless of d location.Wot nw happen 2 cassava farmers in nigeria, how many of dis farmer can even sponsor their children thru cassava? If good market 4 cassava really exist it shouldnt be hidden.so, dat is reason y i said wot u say abt cassava is nt true and wot u stated as a proof 4 jethro does nt convince me at all.thanks. Bt i wish 2 learn smthns abt WM frm u.

In your own state, how many foodstuff markets are there? Do you know all of them?

I do not live in the South West. But let me help you by giving you some information which will help you.

For gari, the market flow in Nigeria is like this:

Smallholder units in villages---->rural markets--->urban markets----assembly markets----->destination markets in other states.


You can get in at any of these points. Take a look at the attached map.

4 Likes

Re: The Cassava Story. Profitability And Loss Theory by stagger: 4:07pm On Feb 19, 2015
You can see where we have most concentration of gari processing units at smallholder level. You therefore cannot expect to make so much money from gari processing in Oyo state or Ogun state, like you would make in the FCT. More supply, less price. Less supply, higher price.

Some farmers in the SW here had confirmed that a 50kg bag of gari is N3,500. Here in the FCT rural markets, it is N6,000.

The cost of cultivating cassava is not much different in the SW and North central. So as a businessman, would I sight my gari factory in the South West? I would not.

The 3 highest cassava producing states in Nigeria are Kogi, Benue and Cross River. If I wanted to sight a gari factory, I would sight it in Kogi state where I am sure I will get plenty of cassava at a good price, process it and transport it to Abuja on the recently dualized Lokoja-Abuja expressway to sell in the FCT markets.

See the attached diagram to show the supply of gari into Abuja.

10 Likes

Re: The Cassava Story. Profitability And Loss Theory by stagger: 4:29pm On Feb 19, 2015
Now if I have plenty of money to start a cassava farm that would serve as my feedstock, I can also get land in those areas which from the gari density heat map, have a very small concentration of gari. Those states almost always get their gari from other states. If you can site your gari factory in those states, acquire or lease land, farm your cassava to serve as your feedstock, and push it into the markets, you will make some good money.

Now a VERY BIG gari export market exists in the form of the Dawanau market in Kano. Almost all the gari sold there is brought in from the southern part of this country and sold to buyers from as far as Burkina Faso. Some of the big time traders here who have warehouses in this market buy from the farmers in the SW at cheap prices, transport the gari to this market and sell at export price premium to the export buyers from Niger, Chad, Cameroun, Sierra Leone, Burkina Faso, etc.

3 Likes

Re: The Cassava Story. Profitability And Loss Theory by stagger: 4:31pm On Feb 19, 2015
However, the export market is an elite market. If you cannot speak Hausa or you have no Hausa-speaking partner to break into this market for you, sorry!

So what is the point I am making here?

Don't just blunder into a business without getting access to market research. Companies spend a lot of money on market research because that is what separates the profitable ones from the losers.

Cassava is profitable. You just have to know where the profits really are.

12 Likes

Re: The Cassava Story. Profitability And Loss Theory by sheyi86: 4:41pm On Feb 19, 2015
stagger:


In your own state, how many foodstuff markets are there? Do you know all of them?

I do not live in the South West. But let me help you by giving you some information which will help you.

For gari, the market flow in Nigeria is like this:

Smallholder units in villages---->rural markets--->urban markets----assembly markets----->destination markets in other states.


You can get in at any of these points. Take a look at the attached map.


Thanks sir
Re: The Cassava Story. Profitability And Loss Theory by tswitch: 5:23pm On Feb 19, 2015
stagger:
However, the export market is an elite market. If you cannot speak Hausa or you have no Hausa-speaking partner to break into this market for you, sorry!

So what is the point I am making here?

Don't just blunder into a business without getting access to market research. Companies spend a lot of money on market research because that is what separates the profitable ones from the losers.

Cassava is profitable. You just have to know where the profits really are.



100,000,000,000 likes
Spot on!

10 Likes

Re: The Cassava Story. Profitability And Loss Theory by Nobody: 6:18pm On Feb 19, 2015
@stagger, where can one get similar map for each agric produce density?

am checking google right away, bt do let us know other sources.
Re: The Cassava Story. Profitability And Loss Theory by stagger: 7:11pm On Feb 19, 2015
mercylicious:
@stagger, where can one get similar map for each agric produce density?

am checking google right away, bt do let us know other sources.

The book that contains the maps is not even in print anymore. I am working to get another copy through one of the authors. If I succeed, I will tell you how to get it.

1 Like

Re: The Cassava Story. Profitability And Loss Theory by TAEpiphany: 10:02pm On Feb 19, 2015
Here's a man that knows what he is talking about, not those ones that will be making empty promises that they have market and can link you up, only to start yarning dust at the last minute.
Good job for dropping some knowledge.

@Jethro good job as usual.

stagger:
Now if I have plenty of money to start a cassava farm that would serve as my feedstock, I can also get land in those areas which from the gari density heat map, have a very small concentration of gari. Those states almost always get their gari from other states. If you can site your gari factory in those states, acquire or lease land, farm your cassava to serve as your feedstock, and push it into the markets, you will make some good money.

Now a VERY BIG gari export market exists in the form of the Dawanau market in Kano. Almost all the gari sold there is brought in from the southern part of this country and sold to buyers from as far as Burkina Faso. Some of the big time traders here who have warehouses in this market buy from the farmers in the SW at cheap prices, transport the gari to this market and sell at export price premium to the export buyers from Niger, Chad, Cameroun, Sierra Leone, Burkina Faso, etc.

3 Likes

Re: The Cassava Story. Profitability And Loss Theory by stagger: 10:41pm On Feb 19, 2015
As far as cassava is concerned, remember that for each state, there are:

a) rural markets--->
b) urban markets---->
c) assembly markets----->
d) destination markets

These exist for gari, cassava flour and HQCF. You can enter into any of these market areas. Once you identify the markets for your location, you have cracked the code. Better still, if you can use the heat map and break away from the already choked up states of Oyo, Ogun and Edo states, you have created space for yourself in the market.

So what is the way forward?

a) Get the heat map of produce density for the cassava derivative you are interested in. This will immediately tell you where there is less competition and which areas are underserved.

b) Start your own source farms. This will take at least one year to produce feedstock for you. A study has identified that having your own farm to supply you 80% to 90% of your own feedstock drops the cost per tonne of cassava to N4,000. Great savings for a processor.

c) You must within the one year you are developing your feedstock, start thinking of setting up your own processing plant. It is better to own 10% of something than 100% of nothing (Pat Utomi). 10 like-minded persons can pull funds together and make this happen. I think Legsupnigeria already has a post along this line.

d) Get improved seedlings from IITA and introduce them to farmers within a 30km radius around you. This will ensure that if you have to purchase from them to supplement your feedstock (no plant is really ever self-sufficient in this regard), you can be sure what the farmers are selling to you is quality improved varieties. Very important if you are producing cassava flour.

e) By this time, you should have identified the markets where you can offload your processed product. I find it staggering (forget the pun) that in a country of 170 million people where everyone eats swallow, people will actually say there is no money in cassava. Maybe cassava farming, but definitely not in selling the processed products.

If as a business person in agriculture, you are not ready to travel round the country to break new ground, then you are better off going to work in the ministry or post office carrying files. Dangote is now in 14 African countries. He is breaking ground, traveling, leaving his comfort zones.

Why then will a serious farmer who is having issues with sales because of competition or congestion not be prepared to travel to another part of the country to make a living? I know a Yoruba man who left his family in the SW and is presently in my state farming and processing. His kids are in good schools. He left the SW because he was not making money as a result of congestion. So he created space for himself and is now in a better place.

If you want different results, change the old way of doing things and do things differently.

22 Likes 2 Shares

Re: The Cassava Story. Profitability And Loss Theory by lanre2009: 3:47am On Feb 20, 2015
stagger:

If you want different results, change the old way of doing things and do things differently.

I raise my hat for you sir....blessed by this your epistle

5 Likes

Re: The Cassava Story. Profitability And Loss Theory by ADONRI(m): 3:22pm On Feb 20, 2015
@Lesgupnigeria.....I would say you quoted to give wrong information, because of your lack you sincere interest to give explicit lessons and experience of yours in terms of profit and loss to guide followers, just as @Jethro2 is doing, even if wrong or wright! what we need as your followers need is your THEORY in its explicit form,rather than your commercial interest!........Your contribution is indeed well received and appreciated
Re: The Cassava Story. Profitability And Loss Theory by Lesgupnigeria(m): 4:46pm On Feb 20, 2015
@ADONRI
I don't actually understand some of your content.
I would be glad if you can.put it in a simple straight sentences,so as to be able to respond well to your statements and how do.you mean by commercial interest?

I have so much in my cup at present and i will.not want to waste my time on theories that i know hold no waters.

If you are a farmer you should know that farming business is not THEORY but PRACTICAL so i.don't give THEORY in explicit form as you have mentioned.

Farming is not saying, or writing theories but practical that comes from real time field experience

I wouldnot comment much as stagger has shed some light on this.
Re: The Cassava Story. Profitability And Loss Theory by Lesgupnigeria(m): 5:23pm On Feb 20, 2015
sheyi86:
Do u remember dat undagraduate dat asked 4 advice on which crop 2 cultivate while on campus? Dat u qouted jethro abt cassava stuff.in ur proof there u make mention of a processor u partner wit which after supplying ur cassava 2 him his machine got fault and u waited 4 sm month b4 he could pay u. Sir, do u think it is profitable 4 farmer after waiting 4 a yr plus and then wait some months b4 he could get his reward 4 his labour? Pls lets be realistic all d buyer u mention wia re they? Are they in heaven? How many farmers can access dis pple, cassava production is nt d issue bt d market.we all knw dat cocoa farmers are smilling all d time because there is always market 4 dis produce regardless of d location.Wot nw happen 2 cassava farmers in nigeria, how many of dis farmer can even sponsor their children thru cassava? If good market 4 cassava really exist it shouldnt be hidden.so, dat is reason y i said wot u say abt cassava is nt true and wot u stated as a proof 4 jethro does nt convince me at all.thanks. Bt i wish 2 learn smthns abt WM frm u.
How many successful cassava farmers have you met?
See and meet successful farmers beyond your location.
Stagger has said it all and no need to comment much
If you are wise, i believe you should parley with people that have made money and gain more experience in this business.

It will be better if you open your mind to learn more instead of talking what you dont know.

Do you think that you will make profit when everybody have access to the same markets or buyer?

Thats what the local farmers use to do that make buyers take advantage of them.
I always want to create my own market and serve the market.


Agribusiness is different from agriculture. Agribusiness is doing your market research well,creating the market for your produce and supplying the market.

Stagger has open up one out of numerous strategies to make fortune in this business.
You Better grap it and start taking action on how to make work for you instead of saying what you dont know

1 Like

Re: The Cassava Story. Profitability And Loss Theory by PapaBrowne(m): 5:30pm On Feb 20, 2015
@stagger
Knowledge is power!!!
Love the way you broke down your points!!
In every market where glut reigns supreme, the best escape is value addition. The other option is osmosis- moving from an area of high concentration to other areas with less concentration!!

9 Likes

Re: The Cassava Story. Profitability And Loss Theory by sheyi86: 6:41pm On Feb 20, 2015
Lesgupnigeria:

How many successful cassava farmers have you met?
See and meet successful farmers beyond your location.
Stagger has said it all and no need to comment much
If you are wise, i believe you should parley with people that have made money and gain more experience in this business.

It will be better if you open your mind to learn more instead of talking what you dont know.

Do you think that you will make profit when everybody have access to the same markets or buyer?

Thats what the local farmers use to do that make buyers take advantage of them.
I always want to create my own market and serve the market.


Agribusiness is different from agriculture. Agribusiness is doing your market research well,creating the market for your produce and supplying the market.

Stagger has open up one out of numerous strategies to make fortune in this business.
You Better grap it and start taking action on how to make work for you instead of saying what you dont know


wit wot u and stagger av stated so far, i can say dat u re just office or sitting room farmer dat base on theoretical aspect of farming u re nt a practical farmer at all, mind u 70% of d theoretical aspect is nt applicable practically.Stop luring pple into wot is real.Go for real.

4 Likes

Re: The Cassava Story. Profitability And Loss Theory by Lesgupnigeria(m): 11:34am On Feb 21, 2015
sheyi86:
wit wot u and stagger av stated so far, i can say dat u re just office or sitting room farmer dat base on theoretical aspect of farming u re nt a practical farmer at all, mind u 70% of d theoretical aspect is nt applicable practically.Stop luring pple into wot is real.Go for real.
There is no.need of wasting my precious time arguing with you.
I have received so many nairalanders on my farm in the past few months, so stop exposing your own folly here so that nairalanders reading this will not be laughing at your folly.

1 Like

Re: The Cassava Story. Profitability And Loss Theory by jethro2: 2:10pm On Feb 21, 2015
Few years back when i was doing my masters at the University of Abuja. My lecturer gave us a note on thermodynamics to make our own copy.
Lo and behold on the right hand side was written 1978. The same note he got from his lecturer.
My point is most researchers never set foot out of the their office. They produce their write ups based on someone else result from years back.
Things have changed. We are in the jet age. 1978 theory can not be applied in 2015.
What I am saying is an intending farmer should work mostly with practical farmers and not research book. Get into the field to learn. Investigate thoroughly from 3 or more practising farmers.
Most practical farmers dont keep records. They hardly document things. The information exist in their brain. Majority can not even write. They dont have access to internet and they mostly stay in rural settlement.
We have 3 categories of people
1. Those that dont know but claim to know
2. Those that knows but choose to say the opposite
3. Those that actually knows.
Lets be wise

11 Likes

Re: The Cassava Story. Profitability And Loss Theory by jasper7(m): 2:28pm On Feb 21, 2015
This is getting interesting, I am grabbing knowledge from every angle. Personally, I have a big reservation for cassava farming. but I have heard of people who made money from it.

I never get chance to understudy any one of them because the interest doesn't exist. My conclusion on this matter is this

If you have interest in farming cassava, farm cassava. because if you have passion for something, you'll see it through.

If your interest is money, Don't farm cassava. Cassava needs passion to succeed, vegetables too. same with poultry. Most times that's the difference between successful poultry farmers and failures.

If you just want to farm for money, go into plantation. At least, come rain, come sun you'll sell. cheesy.

At least that's what I can deduce from what I have read so far.

Time for me to ask questions.

2 Likes

Re: The Cassava Story. Profitability And Loss Theory by jasper7(m): 2:51pm On Feb 21, 2015
My first question goes to oga stagger, please it's not compulsory you attend to my questions, but I feel it will be useful to those of us trying to learn. Just to clarify the air.

You spoke about the 4 available markets rural, urban, assembly, and destination. and I am believing that the products follows this delivery chain, once it leaves the farmgate.

You also made some interesting points on empowering farmers around you. so that they can give you identical high value products, incase you want to process yourself, or supply to a big firm that maybe had minimum supply quantity.

And it's therefore a no-brainer, that each step a farmer can cut in the supply chain will increase his/her own income.

But there's a big challenge I'll want you to treat.

TRANSPORT.

I think the major reasons farmers prefer to sell at farmgate is the many challenges and cost that come with transport. Cassava is currently quite expensive and scarce in Imo but I don't see trailers bringing cassava in. I dunno, I always felt it is because the value of one trailer of cassava might not be up to the cost incurred in transport. I dunno shaa just saying. please shed more light.

2. you spoke about the northern market in one of your post being the center for cassava product export. is there a reason why they don't plant cassava ao much in the north?

That's all for now sir.
Re: The Cassava Story. Profitability And Loss Theory by jethro2: 2:59pm On Feb 21, 2015
Mind you, I am not saying one can not make money through cassava but not from cassava planting and supplying to companies.
Even gari processing have its own niche that one must understand.
Lets assume you converts your cassava into gari
Depending on the starch content of the cassava
A 3 tonne cassava will gives you between 500 - 700 kg of gari.
50kg bag in my area is N3500
You can not transport a bag all the way to Abuja.
The distance from Saki area to Lagos is 4-5hours.
The distance from Abuja (Gwagwalada) is not less than 10-12hours
I will just summarise Lagos trip so one can imagine Abuja side.
A 30 tonne, 12 tyres trailer from Saki to Lagos is from N150,000 - N180,000.
Loading is between N15,000-N22,000
Local government fee, Police check points on the road, Eleru payments will also be factor in.

Now back in Abuja
Warehouse payments for goods
Abuja Municipal Council payment
Off loading etc

Except you will be sitting down in the shop to sell using an attendant which you place on salary, I am not seeing how the N6,000 sales can directly be yours.

I will assume that 30tonnes load of gari will be shared among the retailers. Automatically not at N6,000 per bag.

Unforseen circumstances like vehicle breaking down could also be factor in at some point.
Passion and determination are greatly needed to break through

5 Likes

Re: The Cassava Story. Profitability And Loss Theory by jasper7(m): 2:59pm On Feb 21, 2015
@jethro2. Ma, I think the major reason most of us open threads is to share experiences both good and bad. and the ultimate reason is for people to learn. Let's trash out this matters and see where it leads. We all might learn a thing or 2 at the end...

You said you have many hectares of cassava. and you have given very valid reasons why you can't sell it fresh. Can we look at processing? My questions are as follows?

How long can cassava survive inside ground when mature? Does staying long add or remove value from the cassava?


Are there angles you feel you have not covered in terms of marketing?

sorry o, my questions might sound silly and rookie, I have no idea on cassava farming.
What does it take to process this cassava into garri or something?
Re: The Cassava Story. Profitability And Loss Theory by stagger: 3:04pm On Feb 21, 2015
jasper7:
My first question goes to oga stagger, please it's not compulsory you attend to my questions, but I feel it will be useful to those of us trying to learn. Just to clarify the air.

You spoke about the 4 available markets rural, urban, assembly, and destination. and I am believing that the products follows this delivery chain, once it leaves the farmgate.

You also made some interesting points on empowering farmers around you. so that they can give you identical high value products, incase you want to process yourself, or supply to a big firm that maybe had minimum supply quantity.

And it's therefore a no-brainer, that each step a farmer can cut in the supply chain will increase his/her own income.

But there's a big challenge I'll want you to treat.

TRANSPORT.

I think the major reasons farmers prefer to sell at farmgate is the many challenges and cost that come with transport. Cassava is currently quite expensive and scarce in Imo but I don't see trailers bringing cassava in. I dunno, I always felt it is because the value of one trailer of cassava might not be up to the cost incurred in transport. I dunno shaa just saying. please shed more light.

2. you spoke about the northern market in one of your post being the center for cassava product export. is there a reason why they don't plant cassava ao much in the north?

That's all for now sir.

Gari is not a staple of the northern tribes in Nigeria, so the cultivation of sorghum, millet, rice, soyabeans, ridi (beniseed) is more popular than planting of cassava. However, migration patterns of southern people into the North as well as the export demand from neighbouring countries puts some demand on gari. So rather than cultivate it, a lot of it is brought from the south.

To answer the 1st question, the state of the roads in the SE is appalling. I am sure you are a living witness. Bad roads add to the cost of transporting any product to the market. This is why the cost benefit of procuring cassava for processing beyond 30km reduces dramatically. In contrast, the roads to the North and within the north are far better and require less maintenance because of the climate and soil.

Perhaps, if the rail network is fully complete, transport will not be so much of an issue as it is now.
Re: The Cassava Story. Profitability And Loss Theory by jethro2: 3:14pm On Feb 21, 2015
jasper7:
@jethro2. Ma, I think the major reason most of us open threads is to share experiences both good and bad. and the ultimate reason is for people to learn. Let's trash out this matters and see where it leads. We all might learn a thing or 2 at the end...
You said you have many hectares of cassava. and you have given very valid reasons why you can't sell it fresh. Can we look at processing? My questions are as follows?
How long can cassava survive inside ground when mature? Does staying long add or remove value from the cassava?
Are there angles you feel you have not covered in terms of marketing?
sorry o, my questions might sound silly and rookie, I have no idea on cassava farming.
What does it take to process this cassava into garri or something?
Thank you for the valid questions @Jasper7
1. The longevity are determine by the varieties.
The new hybrid has maximum of 2 years.
The older version that was been planted can last between 3-5years.
2. If the cassava is still getting nutrients in terms of rain, the value does not depreciate
But if it has no supplement nutrient then the root begins to feed on the previously stored starch to withstand the drought
3. Marketing: I think i have done a lot could be wrong though.
The major problem is that all Processing factory in Nigeria are private owned. There is no fixed rate or standard. Coupled with a lot of misleading information on the profitability of cassava which are quite the opposite

2 Likes 1 Share

Re: The Cassava Story. Profitability And Loss Theory by AreaFada2: 3:14pm On Feb 21, 2015
Finally deservedly on fp.
Re: The Cassava Story. Profitability And Loss Theory by jasper7(m): 3:17pm On Feb 21, 2015
@lesgupnigeria, oga, you are the only person on Nairaland that has openly admitted to making money from selling raw cassava.

I know you'll not want to share your secrets on a public forum and at least not for free. and I absolutely buy that idea but at least for those of us watching from outside just explain this shortly,

1. what are the factors that made your cassava to be sold at high rate, is it the quality? or the season you sold it? or the location of your buyers? is there anyrhing special about your own transaction that the likes of Jethro and the rest who are complaining here failed to do. because I don't understand why a buyer will buy at high price when he can get for cheaper except for quality or something of that nature.

Pls, I saw when you mentioned argument, when responding to someone. please don't see this things as arguments, see it as debates.

I remember when I was arguing with someone on my thread that drip alone cannot serve my cucumber. The person put facts and figures to me and I went home, tried it, came back with better results. I learnt something from that debate. Let's keep an open mind to all this talk. remember that nairaland is a faceless forum, the person you are talking with today might be your next door neighbor and you don't know. grin.

In as much as we are all pros in our fields. nobody can be completely right and nobody can be completely wrong. we can always learn, even from day old babies. peace guys

6 Likes

Re: The Cassava Story. Profitability And Loss Theory by stagger: 3:17pm On Feb 21, 2015
Now gari can be sold to several sources.

The Nigerian Prisons service has contractors who supply to all the prisons in Nigeria. These contractors are awarded on a prison to prison basis. They have to buy from somewhere. I have personally been to the NPS headquarters in Abuja on this account and have some info on how the process works.

Hotels have to buy on a daily basis. Boarding schools, police training colleges, NYSC all procure gari. Some states like Bayelsa are known only for hotel business. In the Niger Delta, gari, fufu and starch are the staple foods. In Odukpani LGA of Cross River state, there is a fufu production zone.

The national strategic food reserve also stock piles lots of gari. Many may not know it, but we are actively supplying close to half of the gari and other food eaten in Niger republic under this program. The government contracts this out and the contractors have to buy in large quantities.

Gari is not the only product that can be derived from cassava.

My point is, the individual has to put in some work to identify and carve a niche which will separate him or her from the rest of the population.

3 Likes

Re: The Cassava Story. Profitability And Loss Theory by Laycan(m): 3:20pm On Feb 21, 2015
stagger:
A very enlightening story, but not strange for those of us who have done some business with government. The truth is this: you can never put critical aspects of your business in the hands of government or those claiming to represent govt.

I have had people bring proposals to me worth hundreds of millions of naira. For that particular business, the YouWIN grant gave me massive capacity to the point where I now deal with foreign clients. So I have Nigerians bringing proposals, hoping to leverage on my capacity. They tell me things like "the Minister is interested in this.." or "I have a link to the Presidency..." to "this job is for the government of so so and so state. In fact, we just met the governor the other day..." and all the blah blah blah blah blah.

When they come with this big talk, I laugh. I have been doing business since I was a teenager in the 80s. I can tell you I have seen a lot of things. People come with all sorts of big talk, big promises, big dreams. I simply laugh and put a few questions to them and puncture everything they say. Some rethink the whole job, some get annoyed, leave and then run into an endless frustrating cycle.

Back to our agriculture. You see, anyone who clearly studied OBJ's agric program which was led by Boma Anga will see that there was a lot of loopholes in the whole stuff. Noble idea, but bad implementation. No legal framework to back anything up. When it comes to cassava, you can NEVER make any money hoping to sell to processors, unless maybe like Legsupnigeria, you just have the good luck of meeting processors who can respect a commodities futures contract the way it is done abroad.

The only way to go is to buy your own processing equipment, then identify a market for your product BEFORE planting. The high perishability rate of cassava puts farmers at the mercy of processors and the processors know it. The processor can hold out for as long as possible. The farmer can not and eventually, the farmer will have to give in.

Everything in life has a plan. If you are in cassava and you are not making any plans to build your own processing factory, no matter how small, you will be in for a very long and frustrating journey. That is just the way it is.

We should also look at a number of factors. There is a lot of talk of E-10, which is supposed to be the new fuel for cars in Nigeria with 90% petrol and 10% ethanol. Do you think that project will see the light of day as long as the fuel import cabal is in place, donating billions to the ruling party? I think not. Point here: try not to depend on a govt policy. In Nigeria, policies are only as old as the governments that formulate them. We can see how difficult it has been for the composite flour policy to take off.

My 2 cents is this. Farm other crops, save money, buy your cassava processing equipment, identify a ready market for your PROCESSED CASSAVA (not raw tubers), before you actually start planting. You can sell gari, starch and flour to end users with good marketing and make your money. You do not need to put yourself in the hands of the mobile processors, companies like GIZ and all. Not worth it.

Wait ooO I remba KOKO GARI lemme cal D banj
Re: The Cassava Story. Profitability And Loss Theory by stagger: 3:24pm On Feb 21, 2015
Let us even deviate from cassava.

Recently I felt like drinking gari with these large brown crayfish (or is it prawns) known as "oporo". I used to charter them from creek road in Borikiri area of PH. But I hardly get them in Abuja. So I decided to check some markets and found them in properly packaged cellophane bags, selling for N500. Very expensive for the quantity. So I engaged the woman selling them and she told me she gets them from Karmu market from a certain Igbo man who buys them from creek road in PH, transports them all the way to Abuja, repackages them and sells to market women who rush the product.

I understand the man has a near-complete monopoly. He simply carved out a niche market for himself and is making his money. Food for thought.

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