CBN interventions for agro-processing only on paper ― Processor

The Chairman Harvest Feeds Agro-Processing, Goke Adeyemi, has said that the Central Bank of Nigeria (CBN) has not done enough in supporting agro-processing as it has supported farmers over the years.

He said agro-processors, especially cassava processors, had a tough time in 2021 due to the crisis between farmers and herdsmen, which increased the price of cassava and made it unavailable.

In an interview with Tribune Online, Adeyemi said processors did not receive support from the CBN despite sending in applications.

“The Central Bank of Nigeria (CBN) plan to support industry came to nothing, I can tell you that we did not receive any support from CBN, there are a lot of packages from CBN, but I can tell you that they are mostly on paper, it has not reached its destination, they may be hanging in Abuja with some of their friends, but the real sector players didn’t get anything. I sent my application to CBN but I didn’t get anything.

“We are still struggling to improve on employment generation, initially I had about 250 staff during the heat of COVID-19 pandemic, it dropped to 120, and now I am operating within 100 to 110 staff, which is about 40 per cent of what I had before. That is what agriculture financing did to us last year,” he said.

The processor whose industry is located in Ogun State said due to lack of government support for starch processing, the cost of running the factory has increased, thereby making the cost of local starch higher than that of the imported ones.

He said local users of starch had ceased patronising the local starch processors because of the disparity of price of local and imported starch.

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“The cost of energy was almost more than 100 per cent in 2021, initially, a litre of diesel was going for about N180, but towards the end of 2021, the price increased to N350 per litre.

“In terms of power supply, there has not been any improvement, we are still running on diesel, and every day, I use 3000 litres of diesel to run one factory, with the current price of diesel, I spend over N1 million on diesel daily, so where will the profit come from?

“The overall is that as the price of our locally produced starch increased to almost N450,000 per ton, the demand from our customers reduced because the price of imported starch remained at about N280,000 to N320,000 per ton, our customers ran away. This affected our output, it affected our incomes, it affected our loans we took from the bank.

“As I speak to you right now, we operated at about 30 per cent to 40 per cent capacity last year. Agriculture financing in 2021 was also a disaster, the commercial bank interest rate is still very high at about 21 per cent to 25 per cent.

“The investment is not fully utilised, we have two factories, I run only one, we don’t run on full capacity, I have a machine that can produce 70 tons of high-quality cassava starch daily, but with the entire scenario I have explained, I was only able to produce 22 tons of starch daily,” he noted.

Adeyemi said he had secured 2000 hectares of farmland in Ogun State where he can employ about 500 cassava farmers to plant cassava for processing.

“We are doing additional backward integration, I have secured about 2000 hectares of farmland in Ogun state and we will be cultivating cassava on it, so the factory will generate additional 350 direct jobs between June and September, and there will be additional 500 cassava farmers that will supply cassava tubers to us for the new installation in our factory,” he added.