From substituting imported fish with locally produced alternatives to offering maintenance solutions for agricultural machinery, we spotlight eight promising opportunities in Nigeria’s agribusiness and food sector worth considering in 2024.
1. Leveraging agriculture in northern Nigeria for regional trade
Northern Nigeria’s strategic location positions it well to export crops and food products to neighbouring countries like Cameroon, Chad, and Niger, according to Surayyah Ahmad Sani, co-founder of venture capital firm Aduna Capital. “I think agriculture is definitely a low-hanging fruit by virtue of the fact that most of the food in Nigeria, and much of the food in neighbouring countries, comes from northern Nigeria,” she says.
2. Selling made-in-Nigeria products in America
Amid ongoing discussions about the future of the African Growth and Opportunity Act (AGOA) – which allows qualifying African countries to export certain products duty-free to the US – several food and agriculture companies with operations in Nigeria are already tapping into the massive American market. Affiong Williams, CEO of ReelFruit – a producer of dried fruit snacks based in Nigeria – views the substantial Nigerian diaspora in America as an opportunity for businesses like hers to gain a foothold in the US market. “There is no better market, or no lower hanging fruit, than your people in another country,” she says. “I see a growing opportunity for products such as mine and other food products that are becoming more global in their standards, to sell to the Nigerian market in the US.”
3. Baby food manufacturing
According to the International Trade Centre, the domestic production of infant food in Africa has a wealth of untapped potential. Each year, Africa brings in €570 million worth of infant food preparations, a number that is expected to climb beyond €1.1 billion by 2026. This signifies a major investment chance in Africa’s baby food value chain, where imports outpace exports by a factor of ten. Entrepreneur Adepeju Jaiyeoba, founder of Nigeria-based Colourful Giggles, is already capitalising on this prospect by using locally obtained ingredients to manufacture affordable and nutritional baby food.
4. Turning Africa’s agricultural waste into electricity
There is potential in Africa to convert agricultural waste into electricity, according to Ikenna Nzewi, CEO and co-founder of Nigeria-based Releaf, a company that develops equipment and software to make the oil palm value chain more efficient and profitable. The palm oil processing industry alone generates substantial organic waste which can be used for electricity generation. “I think there is huge potential in biomass electrification, and it is a key area in which Africa needs to take a more active role in the research and development,” Nzewi says.
5. Cold chain solutions in Nigeria
In sub-Saharan Africa, an estimated 40% of food perishes before reaching consumers, highlighting a significant demand for efficient cold storage facilities and transportation services. ColdHubs, a Nigerian enterprise, exemplifies a company capitalising on this need. It offers solar-powered walk-in cold storage units, specifically designed for farmers, retailers, and wholesalers. Located strategically at major food production and distribution points, including markets and farms, these cold rooms are available on a pay-as-you-store subscription basis. Farmers pay a flat daily fee for each crate of produce stored.
6. Maintenance and repair solutions for Nigeria’s agricultural machinery
Mira Mehta, CEO of Tomato Jos, a tomato paste producing company, points out an underexplored business niche in Nigeria’s agricultural sector: the efficient maintenance and repair of farm machinery, including tractors. Frequent parts shortages often result in extended periods of inactivity for these machines. Mehta suggests that new businesses looking to enter this market should engage directly with commercial farming operations to comprehend and address their specific maintenance challenges.
7. Fish production
The import substitution of fish holds substantial potential in Nigeria. One entrepreneur who has tapped into this opportunity is Dupe Killa-Kafidipe, founder of Platinum Fisheries, a Lagos-based aquaculture company. Focusing on the domestic market, the firm produces catfish, tilapia, mackerel, and snails. Killa-Kafidipe believes Platinum Fisheries has only just begun to tap into the significant local demand for fish products. “There are 200 million Nigerians that need to be fed [and] we currently import 85% of our seafood needs,” she says.
8. Harvesting opportunities in West Africa’s pineapple sector
The pineapple industry in West Africa presents significant business opportunities, as there is increasing demand for fresh pineapples and related products in both regional and international markets. Nigeria is the largest producer in the region, followed by Ghana, Benin, Côte d’Ivoire, and Togo. Regardless of the scale of processing, a key challenge is the lack of fresh product supply throughout the year. Other challenges include the lack of availability of varieties suitable for processing, high production costs and low productivity, a lack of well-organised cooperatives and access to loans, limited market information, and a lack of processing and packaging equipment as well as of refrigerated storage and transportation.