Top 7 Agriculture Business Ideas in 2016
Going by some outlined policies by the current administration of President Muhammadu Buhari, It is no doubt that the year 2016 will witness a huge boom in the agricultural sector. With the planned nationwide introduction of primary school feeding programme, ban on the importation of some food products and the need to divest government revenue sources. The Agricultural sector will witness huge activities, not only in the actual production (farming) but other activities along the value chain. Here are our top 7 Agriculture businesses you can invest in 2016.
1. AGRO MARKETING
Ask an average farmer what their major challenge is? 95% of the answer you will get is MARKETING. There will be huge opportunities in 2016 for supply of various agricultural produces especially with the introduction of the nationwide introduction of the primary school feeding programme; government will be in need of individuals or companies that will ensure continuous supply of food produce for the successful implementation of the programme. They will encourage local sourcing of these food produce and don’t forget that industrial companies especially food related industries will also require supply of these farm produce.
What You Can Do: most of these farm produce are sourced from the rural areas. People in the rural areas concentrate mostly on their farming activities; they have less time to engage in the actual marketing particularly to end users. You can take advantage of the opportunity provided by this channel in purchasing the produce (prices are usually cheap) from different markets patronized by these farmer and supplying the government or industries.
Most industries also rely on suppliers to locate, buy and transport these agricultural materials to them and they buy from them (of course at a much higher price). You too can be part of this opportunity by locating a manufacturing company and start supplying them with raw materials based on their specification and quality.
2. AGRO PROCESSING BUSINESS
Agro processing is basically the conversion of primary agricultural products directly into other commodities for market. According to the Food and Agriculture Organization (FAO), up to a third of farm produce are never consumed by humans but instead gets spoilt or is eaten by insects, rats and other pests. This is mainly because the produce is not utilised before it begins to decay or get eaten by pests while in the process of storage.
In Nigeria, productions of agricultural produce are not really the issue, lack of market and processing facilities contributes largely to the losses in the sector. See the following statistics
- Tomatoes has domestic demand of 2.3 million tonnes annually, national production is estimated at 1.8 million tonnes, with wastage of over 750,300 tonnes. Yet the import bill for tomato paste is about of N16 billion to make up for the short fall in local production and processing.
- Horticultural crop especially citrus (oranges) has national production of 3.48 million tonnes, contributing about 29.71 per cent of the world’s production and 81.98 per cent of Africa’s total output, however, about 1.53 million tonnes of the product is lost annually as waste.
- Nigeria is the largest producer of pineapples in Africa, producing 903,000 metric tonnes, South Africa produces about 100,000, but we import pineapple juice from South Africa. Nigeria is the largest producer of mangoes, 620,000 metric tonnes, South Africa produces about 50,000, but we import the juice from there.
This figure can be reduced significantly if agro processing is prioritised. Moreover processing farm produce adds more value to the produce, increases its shelf life, enhances its qualities, increases its versatility and most importantly increases the selling price. Almost all farm produce can be processed into another product which leaves us with an enormous amount of choice plus the demand for processed product is far greater than that of the raw material used in making the product. The Bank of Industry (BOI) has a special fund that could be access by companies or co-operatives that wish to setup agro processing industry.
READ: How to Access BOI Fund for Agro Processor
