Cocoa Origin Focus: Nigeria – Part 1
- Diego Miranda
- Jul 2
- 5 min read
Nigeria At-a-Glance
Production: Average production of approximately 250–300 MMT annually over the past decade.
Global Ranking: Typically the world's fourth or fifth-largest cocoa producer and Africa's third-largest producer.
Cocoa Types: Predominantly Forastero and improved hybrid varieties developed by the Cocoa Research Institute of Nigeria (CRIN).
Harvest: Main crop from October to January; mid-crop from April to June.
Harvesting: Entirely manual.
Key Producing States: Ondo, Osun, Oyo, Ogun, Ekiti, Cross River, Edo, and Akwa Ibom.
Climate: Humid tropical conditions with annual rainfall generally ranging from 1,250 to 2,500 mm.
Farm Structure: Approximately 98% of production comes from smallholder farmers.
Average Farm Size: Mostly between 2 and 5 hectares.
Processing: Growing domestic grinding industry, though the majority of production is still exported as raw beans.
Why Nigeria Matters
Nigeria is the third-largest cocoa producer in West Africa, behind Côte d’Ivoire and Ghana. Despite being overshadowed by its massive neighbors, it remains one of the world's top five cocoa producers and a key contributor to global supply.
Unlike the other two, where producer prices are centrally administered, Nigerian cocoa prices respond more directly to international markets, making them a useful gauge of farmer incentives and production responses to price swings.
Nigeria also has significant untapped potential. Despite its strong production, average yields remain well below those of competing origins. If the country can close this gap and match the productivity of its neighbors, it could evolve from a mid-sized producer into one of the world's leading cocoa suppliers.
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In this two-part blog series, we will see Nigeria’s rise as a cocoa superpower, its subsequent downfall, and its recovery into the mid-sized producer it is today. We will also see what is stopping the country from reaching greater heights, and how recent events can guide the future of the Nigerian (or even the global) cocoa industry.
The Foundations of the Industry
Cocoa arrived in Nigeria during the late nineteenth century, with the first commercial plantings established around the region of Lagos in the 1880s. From there, cultivation started to spread inland throughout the forest zones of the southwest, particularly around Ibadan, Ife, Osun (old Oyo State), Ijebu (Ogun State), and Ondo.
The crop adapted exceptionally well to the country's humid tropical climate. Abundant rainfall, fertile soils, and extensive forest cover provided ideal growing conditions, making cocoa one of the most important cash crops in southern Nigeria.
As cultivation spread, production expanded rapidly from the 1920s onward, once farmers had gained knowledge of the new crop and seeds were distributed enough. By the 1950s, Nigeria ranked as the world's third-largest cocoa producer, with output exceeding 100 MMT and cocoa serving as a major source of foreign exchange and rural employment.
The Golden Age: 1960s and 1970s
The explosive expansion allowed Nigeria to enter the post-independence period (1960) as one of the world's leading cocoa producers.
Production expanded steadily throughout the 1960s and surpassed 300 MMT in the 1970/71 season. At the time, Nigeria was among the largest cocoa producers globally and was widely regarded as the second most important producer in Africa after Ghana. This scenario would eventually shift considerably, with Ghana’s decline and the rise of Côte d’Ivoire.
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Cocoa occupied a central role in the national economy. During certain years, agricultural exports accounted for most of Nigeria's foreign exchange earnings, and cocoa represented one of the most valuable components of that export basket. The crop was so important, in fact, that when the first skyscraper of West Africa was built by the Nigerian government, it was named Cocoa House.
All things considered, it seemed Nigeria was perfectly poised to continue its expansion as a cocoa powerhouse, maybe even aiming for first position among global producers. Yet the seeds of decline were already being planted.
The Oil Boom
The Nigerian cocoa decline was a direct consequence of the rise of another commodity: oil. Although the first discovery of oil fields happened in 1956, the oil sector only truly began to flourish in the 1970s, supported by the stability brought by the end of the civil war and the 1973 oil crisis, which caused prices to rise fourfold in a matter of days.
The petroleum boom, despite becoming a tremendous source of wealth, proved to be a curse for the country's cocoa sector. Beginning in the 1970s, oil revenues increasingly dominated government finances, leading crops to gradually lose political priority. Public investment shifted away from agricultural infrastructure, research, extension services, and rural development.
The Decline
Oil wasn’t the only constraint on cocoa production. Instead, it was the straw that broke the camel's back.
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The abandonment of public investment revealed the structural fragility of the cocoa sector. Very differently from what we see today (something we will explore in detail in part two of this blog), Nigeria adopted a state-controlled cocoa market system, a structured used by most of the former European colonies at the time. Cocoa was marketed through marketing boards that set producer prices and controlled exports. In this way, a substantial share of export revenues was captured by the state, reducing the amount of capital available for producers to reinvest in their farms.
In parallel, Ghana faced its own problems and experienced a sharp decline in cocoa production during the 1970s, eventually losing its position to Côte d’Ivoire as the region’s top producer. This tightening of global supply contributed to a strong rally in cocoa prices, which rose from around $0.5–0.7/kg in the early 1970s to more than $4/kg.
Nigerian farmers could have capitalized on high prices to expand production, had it not been for their own market system. Due to marketing board price controls, farmers did not receive the full benefit of rising world prices, while the government captured a significant portion of that windfall for itself.
The consequences were not immediate, but they became increasingly visible during the following decades. Cocoa farms received limited reinvestment, making farmers unable to plant new trees to replace the old ones from the golden age, which were too old at this point. At the same time, diseases spread rampantly, as farmers lacked money to fight them and had no access to new, more resistant seed varieties.
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The younger generations, meanwhile, migrated toward urban areas in search of employment opportunities and higher pay, since the marketing board limited profits and salaries, reducing labor availability in rural communities.
As a result, the sector entered a vicious cycle, where declining profitability discouraged investment, while insufficient investment further reduced productivity and competitiveness. Production fell from 300 MMT in 1972 to less than 150 MMT by the mid-1980s.
Conclusion
The story is of a thriving cocoa sector that could have completely changed the history of its nation, only to be halted and crushed by the weight of state controlled prices and regulatory bodies. Even the biggest producers on the planet, Côte d’Ivoire and Ghana, have suffered from this in the past, and continue to do so, albeit to a smaller extent.
Fortunately for Nigeria, this situation was not eternal. In the second part of this blog, we will see how the West African nation was able to change its ways and revitalize its cocoa sector. That said, we will also tap into the remaining problems that continue to limit Nigeria’s potential, as well as what we can expect from it in the future.
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