₦airaland Forum

CASSAVA OFFTAKE AGREEMENTS – 2026 MARKET OUTLOOK AND STRATEGIC PLANNING FOR 2027

I recently engaged with different cassava farmers who are actively seeking offtake agreements from industrial processors. These agreements are a key requirement for them to secure funding for their farming activities. Unfortunately, many processing companies are currently reluctant to enter into any offtake arrangements for the 2026 harvest season. The major concern revolves around market price uncertainty. It is widely believed that cassava tuber prices will remain depressed into 2026, giving buyers the upper hand. As a result, processors fear that committing to offtake contracts now may place them in a disadvantageous position if prices remain low.

In response to this challenge, we are shifting focus toward negotiating offtake agreements targeted at the 2027 harvest. While some stakeholders believe it is still too early to begin such discussions, I believe otherwise. The funding cycle for 2026 cultivation, which will result in the 2027 harvest, must begin now to ensure timely planning, planting and sustainable operations.

That said, if any party is to consider entering into an offtake agreement now for the 2026 harvest, whether as a farmer or a processor, a critical question that arise is that what projected price per ton should be used in their Economic of Production (EoP)?

Currently, cassava tuber prices in Oyo and Ogun States have dropped significantly, with supply prices as low as N60,000 per ton in several areas. Given the scale of cassava cultivation this year (though slightly lower than the 2024 planting) and the ongoing direct cultivation efforts by many processors, often backed by various funding supports, it is expected that cassava tubers will remain adequately available throughout the 2026 harvest year.

However, unless industrial demand is reactivated by opening local market for cassava derivatives; cassava starch and HQCF, and scaled up soon, the market risks deeper saturation. This will likely extend the current low price environment, leaving many farmers without viable income and compounding existing financial strain.

At this critical stage, it is essential that both farmers and offtaking processors develop a deeper understanding of each other's realities and commit to working collaboratively. Sustainable operations within the cassava value chain can only be achieved when there is mutual trust and alignment, especially as we look toward 2027, when processors will be more reliant on these same farmers to meet their raw material needs.

In all of this, cassava tuber market prices for both 2026 and 2027 must be properly projected and aligned. This is crucial not only for developing a realistic Economic of Production (EoP), but also for crafting workable Memoranda of Understanding (MoUs) that are fair to both parties. Only with clear and well-informed coordination can the sector navigate the current season of surplus and prepare effectively for the anticipated period of relative scarcity.

Kazeem Lamidi
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